How Leading PLC Providers Are Faring in SDA Environments

Software-Defined Automation (SDA) adoption is accelerating due to labor force contractions, increasing Programmable Logic Controller (PLC) hardware costs, and the availability of new, commercially viable solutions. In the last few years, major vendors, including Siemens, Honeywell, and ABB, have launched soft or virtual controllers. Mitsubishi Electric and Rockwell Automation have been more timid in their progression toward soft or virtual control, potentially missing out on a market that will grow to US$4.7 billion by 2036 (22% Compound Annual Growth Rate (CAGR)) (see ABI Research’s Industrial Automation: Software-Defined Automation (SDA) market data (MD-SDA-101) for more). As the SDA market develops, smaller traditional PLC players such as Schneider Electric, SUPCON, and Beckhoff have captured strong SDA market share by emphasizing the key principles that the market is responding to.

SDA customers are most receptive to three factors: the emergence of Information Technology (IT)-DevOps principles, flexibility and interoperability of systems, and ease of alignment with Artificial Intelligence (AI), which maps well to the pressures driving adoption.

Operational Technology (OT) workflows are increasingly aligning with the IT-DevOps design philosophy, addressing labor force contractions plaguing manufacturing by democratizing access to engineering for young electrical engineers. Flexibility and interoperability of systems address challenges posed by supply chain volatility, enabling manufacturers to adopt more available and local hardware solutions. Interoperability also drives the development of either best-in-breed automation solutions or significantly lower-cost solutions using hardware targeted at smaller markets. AI is one of the most important levers for driving SDA adoption (see ABI Research’s AI in Software-Defined Automation (SDA) report (AN-6583) for key use cases), and the growth of industrial AI is challenging how manufacturers think about their automation and, in the long run, will drive the market toward broader autonomy. These trends are placing strain on relief valves in manufacturing environments.

The top five PLC suppliers by market share are Siemens, Mitsubishi Electric, Rockwell Automation, Honeywell Technologies, and ABB (see ABI Research’s Industrial Automation Hardware market data (MD-IAH-25)). Of these, Siemens has been the most aggressive in pushing SDA forward, while Mitsubishi Electric is the clear laggard. In between these two, Honeywell Technologies has been clear in its ongoing alignment with SDA principles, ABB is playing catch-up this year, and Rockwell Automation is a mixed bag, excelling in principles such as AI and IT DevOps, while lacking a current flagship software-defined control solution (a soft PC-based controller is coming later this year).

In the future, Siemens will primarily focus on fortifying its market presence and fending off threats from Schneider Electric as the two lead the SDA market. Honeywell Technologies will look to shape its newfound identity in light of a stronger AI presence and to continue aligning to bring oil & gas production closer to software definition. ABB will have to turn its catch-up into an overtake going forward, with its virtual control engine emphasizing flexibility, continuing to add to the confusion around the term “openness” in a market where every vendor has a different definition. Rockwell Automation generally bets against flexibility, which will impact its long-term competitiveness beyond manufacturing markets into data centers, where hardware turnover is fast, and the IT companies building them are willing to experiment. Mitsubishi Electric needs to get involved in the race; its AI work is unique, but its digital transformation solutions are packaged within e-F@ctory, a network of companies focused on Industrial Internet of Things (IIoT), which has receded from the cutting-edge of innovation.