VDC Research: Industrial Sensing, Networking & Control Market Blog

Data Acquisition and Networking Connectivity Synergistically Ensure Corporate Success

After reading a recent article in Control Design I felt this was a good opportunity to blog about how data acquisition and networking connectivity are synergistic and how these two critical components enable real-time visibility, operational agility and flexibility, which is the theme of VDC’s recently published industrial networking infrastructure products research as well as ongoing research we are conducting on data acquisition solutions.

Although VDC does not cover the PLC market the article’s relevancy lies in pointing out the strong need among corporations to capture data from their factory floor operations (i.e. sensors, controllers, HMI, etc.) and an efficient means by which to transfer that data to other parts of the organization for some actionable purpose, if not just simply for monitoring a process or the health of a piece of equipment, etc.  Networking, through the advent and adoption of industrial Ethernet and related protocols, has provided companies with the ability to leverage distributed intelligence throughout their automation operations.

The global recession of 2009 had a deep and, I believe, long lasting impact on the psyche of most organizations with a belief that competitive survival is predicated on squeezing every last bit of efficiency (or was it sweat equity?) out of every part of an organization. Getting access to data through the use of standards-based networks, faster hardware and cutting edge data acquisition solutions ensures greater interoperability and real-time visibility, operational agility and flexibility. The factory floor was perhaps one of the last few bastions which historically was allowed (or tolerated) to operate within its own world with its own unique processes and proprietary standards.

The demand for data acquisition solutions and the industrial networking infrastructure products used to transfer the data will continue to grow as companies realize that their ability to achieve real-time visibility, operational agility and flexibility will play the critical role in their ability to survive and thrive in an ever more challenging and competitive global marketplace.

If you check out two of my blogs posted on 4/19 and 4/25 you will get the picture that the combined markets for networking products (wireline and wireless) is large (>$2.5 billion) and is expected to experience some healthy demand in the coming years. Although the research in support of our data acquisition solutions research is ongoing and no final market estimates are available, early readouts indicate that the markets for external chassis and modules and plug-in analog I/O boards will likely total over $800 million worldwide. Now that is some real synergy.

VDC Research Partnering with Sensors Magazine for Data Acquisition Solutions Research

In 2008 VDC asked respondents using data acquisition products how they learned about their data acquisition products and suppliers. The 2nd most cited information source, behind using the Internet, was advertisements in trade periodicals (seems marketing does pay after all). When asked which trade periodical they read to learn about data acquisition solutuions, the #1 trade periodical cited by user respondents was Sensors magazine.

Well the early results from our 2011 Data Acquisition Solutions research tell us that some things do not change, and for the better in this case. The #2 most cited information source among respondents, behind searching the Internet, was ads in trade periodicals. Yet again Sensors was the # 1 cited periodical, and this was before we even agreed on a partnership.

Naturally I was pleased to learn that we would be partnering with Sensors to launch our web survey to their e-newsletter readership. So hopefully if you are a recipient of their weekly newsletter you, or one of your customers, will be receiving an invitation to participate in VDC's online web survey in the near future. We hope to hear from you, your customers and/or especially companies that you may want as customers.

We greatly value feedback from users of data acquisition solutions across many different industry segments and vertical markets. For their participation and a valid email address, respondents will receive an Executive Brief on the findings, and will be entered into a drawing on 1 of 5 $US 100 checks or $US 100 Amazon.com gift certificates to be awarded.

Or if you simply cannot wait you can click here and participate today or share this link with other users of data acquisition solutions who can share their perspectives.  

Process Safety - When Should Corporate Be Involved?

As we begin to see into some of the details of the events at the Fukushima Daiich nuclear power generating plant and the BP Gulf Horizon deep water drilling platform it is clear that corporate management needs to take a more pro-active role in process safety. The problem as I see it is that the corporate role is more geared to the way things look to the investment world and/or public at large as opposed to the actual science of what goes on in these types of facilities. To put it simply, you just don't have time to observe that pressure is building up at an alarming level in say a reactor vessel or oil well and ask corporate management about what you should do next. These decisions should have been made years earlier and put in place through a process safety system. Let me try to explain my thinking.

If B.P. had put a Process Safety System in place that would prevent more drilling if the blowout preventer was not working correctly they would:

• Likely add redundant control and sensing systems to the blowout preventer.
• Strictly adhere to the blowout preventer's preventative maintenance schedules.
• Be very careful not to damage the blowout preventer. The local personnel would not have been able to move the drilling gear (as allegedly happened) while the blowout preventer was closed. A simple integration between the safety system and the drilling gear would have prevented it from happening.

If the properly functioning blowout preventer would be integrated with the process safety system automatically instead of manually after an OK from corporate then:

• BP would not do things such as diluting drilling mud allowing a pressure differential that could trigger the blowout preventer from occurring.

• They would not heat the cement which could cause the methane hydrate crystals from expanding into gas which would activate the blowout preventer.

• In fact, BPs management and the local staff would not be tempted to do anything more risky because in the worst case, the blowout preventer's pneumatic ram could sever the drilling gear.

In the case of Fukushima Daiichi, the TEPCO Corporate management would have been relieved of the stressful decision about whether to release slightly radioactive hydrogen gas that was creating pressure inside the reactor. The reluctance to make that decision in a timely manner ended up contributing to the containment building exploding and ultimately releasing a far greater amount of radiation. In addition to this, the debris and damage from the explosion complicated efforts to bring things under control. If this decision had been made calmly in the previous years with the understanding of the regulatory agencies that this was the lesser of two evils, the process safety system would have taken care of the gas build up automatically.

It is VDC's estimate that, with time, companies will take a more pro-active role with respect to process safety as opposed to being forced into it by regulators and/or their insurers. The benefits are that process safety decisions can be made on an informed basis and not in the stressful time surrounding an event. One of the learnings we see from these events is that process safety decisions are often required in a split second which clearly are out of the ability of a reactionary corporate type process and perfectly in the relm of a Process Safety System.

Ready or Not, Consumer Devices May be Coming to a Factory Floor Nearest You

A recent article in Control Design struck a cord with me as its focus was on usage of consumer-grade devices such as iPads and smart phones on the factory floor and future expectations of user adoption of such devices in industrial applications.  Research from VDC’s Track 1: User Requirements and Channel Analysis wireline and wireless industrial networking infrastructure products reports published in January 2011 indicates that the usage of consumer-grade devices is already here today.

VDC asked respondents if they currently use, or have plans to use, commercial/consumer devices (i.e. iPad, Blackberry, etc.) in their industrial applications and connected via their industrial network. I was surprised at the results based on feedback from the 260 respondents who answered this specific question among the over 600 surveyed.

 Even more surprising was there was not material difference in usage among respondents using wireless networking products versus those using wireline products (+ 3%). Given the many benefits provided by greater mobility via wireless connectivity I would have surmised that the share of respondents using consumer devices would have been higher as I can envision a plant manager walking the plant floor wirelessly monitoring operations from his mobile device, whether it be it a Blackberry, iPad or whatever.

However assuming that the 350 respondents who did not answer this specific question were indicating no current plans of using a consumer device than the usage share falls to 26%, which is a more believable level based on my experience.

There are compelling reasons why suppliers design industrial-grade devices for use in dirty, harsh, wet and even hazardous environments in which many industrial applications flourish. Companies such as Motorola, Panasonic, Intermec and others design rugged mobile computing devices including tablets, laptops, PDA and even smart phones.

These ruggedized mobile devices typically provide much of the same functionality of a consumer device although at a sizeable price premium to account for the enhanced product design and ruggedness which provides for the greater uptime, reliability and durability. However based on feedback from our respondents it seems that a growing share of users may be making the tradeoff in using a lower cost consumer device.

 

GPS Tracking - A Couple of Business Applications That Truly Save Money

The IAC team has noticed the recent outcry over the discovery that many new smartphones are actively recording and possibly transmitting the phone owners' position history back to the manufacturer and/or  service provider. No doubt, these parties are using a combination of the phone's GPS capabilities as well as it's ability to sniff out Wi-Fi hot spots. The idea of using merged position sensing methods allows for better accuracy. What these device manufacturers and service providers are intending to do with these collected data files remains to be seen but obviously they think they can turn this into revenue. There are a couple of GPS position sensor business applications that I wanted to highlight that GPS and the position sensing business do belong together in ways that can be very cost saving and not creepy at all from a privacy perspective.

We first look at United Parcel Service who are experts in logistics but also maximizing their fleet efficiency. Using GPS, they study the routes their trucks take and the time they spend. Using these types of methods, they try to eliminate left turns as in cases where there is a lot of oncoming traffic, and the trucks have to spend more time. They found that in these cases,you can take computer map models and logarithms and combine them with actual GPS position sensing data from the trucks, you get an optimized system that saves money particularly if you can take into account the anomalies from road construction.

Speaking of road construction, this brings up the second use of GPS and position sensing I have been hearing about. I recently read a blog from Houston Neal at Software Advice where he was describing a method used at road and other construction sites that eliminates a lot of costs by using GPS Machine control. This is technology that is literally outside of our normal "indoor" Industrial Automation and Control coverage but very notable that the principals are very close if not a much larger scale. The construction machines are located using GPS but, to gain the needed accuracy, they us a system of a stationary "base" stations and sometimes lasers or other radio devices to gain mm accuracy when digging, grading and moving dirt. This eliminates much of the need for surveying and staking and improves efficiency.

Wireless Networking Products Markets Experiencing Robust Growth

Based on soon to be published comprehensive market intelligence, VDC estimates the worldwide wireless networking products market opportunity in 2010 was $370 million and is growing at a robust pace of over 28% CAGR through 2015.

VDC based its rather explosive forecasts on feedback obtained from 230 respondents using wireless networking products as well as over 200 channel respondents selling wireless networking products.

 

Although VDC does not anticipate the real emergence of wireless infrastructure networks being used up the entire control hierarchy in most applications, particularly those deemed most critical, it does believe that material changes in market will take shape within next five years particularly as more users seek to connect their I/O and device level components into the network via wireless communications.

There are several primary drivers behind this rather explosive growth outlook:

1. Strong growth in the adoption of wireless infrastructure networking in industrial facilities is driven by a variety of factors. Improved efficiency, cost reductions, ability for install where wired solutions impractical or impossible and increased productivity.
2. Wireless networking reduces the majority of the cabling required, thus the associated costs, which is can be more expensive to install in certain locations.
3. Wireless networking allows easier add-ons, changes and removal of functions and is perceived by many users as being more scalable. This is most valuable where changes or expansions are frequent and expensive.
4. Increasing adoption of mesh networking and the self-healing capabilities provided therein
5. Increasing trust in wireless networking and technological enhancements made to overcome previous concerns over reliability, latency and security
6. Perceived ease of implementation and lower implementation costs as well as perceived lower maintenance and installation costs
7. To obtain greater mobility in industrial facilities which provide benefits of real-time response to machine problems, real-time optimization of machine performance, reduce personnel required and increase productivity, and reducing downtime of both equipment and time to repair

Key Differences for Industrial Machine Safeguarding in Academic Setting

When the recent event at Yale first happened, I was very touched by this tragedy but I resisted writing a blog underscoring the obvious link to Machine Safeguarding. My heart went out to Michelle Dufault's family and her fellow students and friends. A couple of days ago, I saw the April 19 Boston Globe had an article that indicated a ramp up in training at Yale for the types of facilities where these kind of dangers are present. This whole event has been troubling to me and something about it still seemed missing. Let me give you some background. 

I have been working on a Functional Safety project where one volume is aimed at Machine Automatic Safeguarding products. The recent event at Yale underscores the importance of training and safety procedures in any place industrial type or high powered moving machinery is present. It also underscores that even though you have these processes and procedures in place and have regular "refreshers", there can be events where the workers/operators forget or become lax in their attentiveness to the details. The article I saw in the Boston Globe was showing the obvious and needed response from Yale. Then, as I was driving to work, I figured out what was missing. In my opinion, the academic setting makes safety training and operational processes much more difficult to maintain as compared to an average industrial facility. Let's look at a few reasons.

Worker Turnover: In an academic situation your machine "workers/operators" are students that turn over on a year to year or semester to semester basis. A typical industrial facility as you might expect has a far lower employee turnover rate.

Focus: A student has many things to do and think about as opposed to a professional machine operator and is probably more sleep deprived on average.

Type of Production: I would also estimate that in most cases, any academic use of machinery would be fabricating one-off prototypes or single units for a project. In an industrial facility, full production runs of anything are usually more automated using Computer Numeric Control (CNC) and therefore needing less operator involvement after set-up. I came from a technical high school program and have a technology undergraduate degree so I feel somewhat qualified to make this estimate.

In closing, I think that machine safeguarding often rides a fine line between safety and productivity but there is a plethora of products that generally allow a solution for any situation. In some cases, you can use hard shields that have interlocks that shut off the machine if opened or even prevent them from being opened if the machine is running. In other cases light curtains or scanners can protect areas where shields are not practical. I think that in an academic setting, increased safeguarding should be enforced because even slight inconveniences and loss of productivity should not be problematic and, if they are, this type of work should be done by the places and people that specialize in it. As I mentioned in a previous blog there are multiple political and economic drivers for the machine safety market and this recent event is likely to cause even more attention in the Academic segment.

Trade Show Trends Bode Well For Overall Industrial Market

If you are thinking about exhibiting your industrial products at a trade show where you might have previously cut back your participation, we see some clear signs that attendance is coming back. Why do we say this? In January of 2010, we conducted a survey for position sensing. In that survey, ~37% of respondents indicated the likelihood of attending one. Later that year, another study conducted for power protection found that metric down to ~13%. In our most recent survey that is still open, the initial tabulation shows the percentage of likely trade show attendees is now at 46% which we feel has positive connotations for the market for industrial products and services of all types.

We also have correlating qualitative information from one of our IAC team members that just got back from the Hannover Messe trade show. Bob Perugini reported that the attendance level ‘was overflowing and everyone he spoke with agreed about the improvement over the last couple of years and that it even seemed to have met or even exceeded the previous peak attendance seen in 2008.' Bob was busy talking to many of the suppliers we interact with and sell to so he was unable to get an exact count but the end of show report supports his and our conclusions.

Healthy Outlook for Industrial Wireline Networking Products Markets

Based on soon to be published comprehensive market intelligence, VDC Research estimates the worldwide industrial wireline networking products market opportunity in 2010 was over $2.132 billion and is growing at a healthy pace of over 20% CAGR through 2015.

VDC based its robust forecasts largely on feedback obtained from 160 respondents using wireline networking products as well as over 145 channel respondents selling wireline networking products.

 
There are several primary drivers behind this vigorous growth outlook:

1. Networking enables companies to realize real-time visibility into operational issues for better decision making, control and management. By having access to real-time data, managers are better prepared to make decisions that will improve performance, and improve quality and production.
2. Networking provides the ability to monitor and control operations and machinery remotely. It provides the ability to incorporate device diagnostics and alarm reporting for operations, equipment, and devices. By using networking, troubleshooting and corrective actions can be accomplished remotely.
3. Networking reduces the majority of the point-to-point hard wiring, which is both expensive to install, difficult to troubleshoot, and hard to modify. Networking allows easier add-ons, changes and removal of functions.
4. Many users who seek plant floor automation often find wireline networking infrastructure products to be more reliable than wireless. Most industrial automation applications require monitoring and/or control equipment to work 100% of the time and users more commonly feel wireline products best guarantee this.
5. The growing acceptance of application layer network protocols used with Ethernet networks as the de-facto standard for wireline industrial networking infrastructure is helping driving this strong growth.  Improvements in industrial Ethernet-based network protocols around reliability, latency and improved real-time deterministic performance are all factors contributing to the growing adoption of Ethernet-based network protocols even in real control applications.

California Green Initiatives Will Likely Impact Industrial Market

The VDC IAC team notes that the recently signed state law in California that requires 1/3 of all energy come from renewable sources in 2020. One significant and controversial detail is that hydroelectric is not considered as being renewable energy. On the surface, this is a commendable commitment that will reduce the need for oil and its associated environmental, political, and economic issues. Depending on how the solar panels and wind turbines are deployed there can be some debate about the environmental trade off but we will leave that aside for this blog.

The impact on industry is something that we want to discuss. If California was an independent country, it would have the worlds 8th largest economy. As one would imagine, it is a location for a huge amount of industrial companies including many that have significant electrical power demand. California already places a burden on these companies as they pay a premium price for energy to subsidize California's social and environmental programs. Experts say that this law will likely increase their costs significantly. Today's Financial Times notes that this will be a 25%  increase over the already double energy cost these California industrial companies pay as compared to competitors in neighboring states. Some industries such as cement producers have to be located near the supply of material and demand for product and they will need to charge significantly more. Steel producers and fabricators also have high electrical energy costs. Together these will increase the cost of building new factories and infrastructure. Other industries are far more portable and the higher energy costs will encourage them to more or, at least relocate their new facilities out of state, to Mexico, or even off-shore.

Let's take a quick look at what the theoretical demand for renewable power generating products. California, ranks lowest of all states for per capita electricity consumption but still uses 257 Billion kWH. If we conservatively consider that 60% of the energy reduction will come from electrical as opposed to solar/thermal, we get a demand for (257 * .33 * .60) of ~50B kWH of solar and wind electicity generator products. This will certainly drive a lot of investments to manufacture these goods but it will take a lot of incentive to actually make them in California.