Abstract
Market Overview
Increased Proliferation of Micro-processor based Equipment Helps Boost Sales
Most of the new equipment being manufactured have in-built microprocessor
chips. As these chips become more complex with the addition of electronic
components, their vulnerability to surges or spikes also increases. The degree
of damage caused by surges depends on the magnitude of the transient voltage
and the type of equipment they come in contact with. In order to protect such
equipment, surge suppressors are used. Computer-controlled systems, for
example, are much more sensitive to surges as the increased integration of
electronic circuits into smaller packages has increased their sensitivity to
transients.
Also the shrinking sizes of semiconductors have impacted the sizes of the
devices they are incorporated into. The newer microprocessors offer greater
and faster processing capabilities in smaller packages, but existing
microprocessor-based devices cannot handle surges and transients well due to
their smaller size. Equipment must be protected to prevent surges from
damaging these sensitive devices. The miniaturization of microprocessors,
therefore, increases the demand for TVSS to handle surges.
In addition to these, the increase in new constructions is likely to further
aid the growing demand for surge suppressors. "An entire building requires a
complete TVSS solution, which protects it against surge, spikes, sags and
other problems, the construction industry is according greater priority to
ensuring that new construction designs have a suitable TVSS device in place,"
notes the analyst of this research service. "Hence, the increase in the number
of colleges, hospitals, schools, and business establishments, among others in
turn raises the necessity of having in-built surge protectors and the impact
of this driver is likely to remain medium-high throughout the forecast period."
Dominance of Electrical Distribution Manufacturers Creates Challenges
The entrance of electrical distribution manufacturers in the construction and
retrofit markets creates a major challenge for companies that manufacture
TVSS. Electrical distribution equipment manufacturers not only distribute
power to end users but also provide products aimed at solving power
quality-related problems. As a result, another tier is added to the
competition within the TVSS market. The advantages of entering the market as
an electrical distribution equipment manufacturer include offering integrated
solutions for power quality problems, utilizing cost-effective strategies, and
providing a larger variety of products and electrical distribution components
from one source. This becomes a challenge to power quality protection
equipment and traditional TVSS manufacturers that compete with these larger
companies for the same share of the market. Manufacturers must strategize to
distinguish themselves by providing quality solutions with better features for
surge suppression problems, enabling them to compete more effectively with
electrical distribution manufacturers.
Summing up, as the demand for microprocessor-based applications continues to
increase, so will the demand for TVSS. While greater end-user awareness of
power quality problems and higher acceptance of TVSS as standard equipment,
are likely to play key roles in revenue and unit shipment growth, customers
also need to be better educated about power quality problems, their potential
consequences, and ways of protecting their equipment from such problems. "In
2005, whereas North America contributed 67.8 percent of the total TVSS
revenues followed by Europe at 21.3 percent, it is the Asia Pacific and Latin
American markets that are poised for relatively higher growth," says the
analyst. "With regard to the product types, the hard-wired TVSS market,
revenues are growing relatively fast in comparison to the growth in the
point-of-use TVSS markets, which is expected to be moderate."
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