SMT Equipment Providers in Southeast Asia Embrace Software as Bedrock for Product Differentiation
-- Vendor inclination to offer line solutions is likely to trigger market consolidation, finds Frost & Sullivan
KUALA LUMPUR, Malaysia, May 20, 2015 /PRNewswire/ -- The business model adopted by most surface-mount technology (SMT) equipment manufacturers in Southeast Asia has been traditionally hardware-centric, evident from the fact that the software component accounts for less than 10 percent of the overall product cost. However, the need for product differentiation is compelling SMT equipment manufacturers to increase software functionality. Demand for flexibility, self-troubleshooting, shorter programming time and improved process control will further widen the use of software in SMT equipment.
New analysis from Frost & Sullivan, Analysis of SE Asian SMT Equipment Software Market (https://www.frost.com/p7dd), finds that the market earned revenues of US$35.4 million in 2014 and estimates this to reach US$61.5 million in 2019. Thailand and Vietnam offer vast potential for market growth.
For complimentary access to more information on this research, please visit: http://corpcom.frost.com/forms/SEA_PR_DJeremiah_P7DD-28_19Mar15.
"Currently, software is primarily offered as a package bundled with hardware," said Frost & Sullivan Measurement and Instrumentation Research Analyst Vivek K Reghu. "Hence, the increased capital investment by electronics manufacturers migrating to Southeast Asia from China will accelerate the development of the SMT software market in the region."
Although software adoption is on the rise, profits from software sales may not reflect this surge. Price-sensitive customers are either unwilling to purchase software separately or coax SMT equipment manufacturers to provide the software for free, forcing several SMT equipment software providers to significantly reduce prices.
SMT equipment software providers must differentiate their products based on value-added service rather than competing on cost. Ensuring integration between SMT equipment, enabling process optimization, and meeting manufacturing requirements through software will bestow vendors with higher bargaining powers while selling software.
"To further bolster their standing, SMT equipment software suppliers are likely to scout for merger and acquisition opportunities, especially if the trend towards line solutions picks up," noted Reghu. "With customers increasingly demanding customization, SMT equipment software providers must also interact directly with end users in order to understand their needs and strengthen customer loyalty in the Southeast Asian SMT software market."
Analysis of SE Asian SMT Equipment Software Market is part of the Surface Mount Technologies (http://www.smt.frost.com) Growth Partnership Service program. Frost & Sullivan's related studies include: Global Radio-frequency Identification (RFID) Market in Retail and Global SMT Screen Printers and Glue Dispensers Market. All studies included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.
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Analysis of SE Asian SMT Equipment Software Market
P7DD-28
Contact:
Donna Jeremiah
Corporate Communications – Asia Pacific
P: +61 (02) 8247 8927
F: +61 (02) 9252 8066
E: djeremiah@frost.com
Carrie Low
Corporate Communications – Asia Pacific
P: +603 6204 5910
F: +603 6201 7402
E: carrie.low@frost.com
Melissa Tan
Corporate Communications – Asia Pacific
P: +65 6890 0926
F: +65 6890 0999
E: melissa.tan@frost.com
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