LONDON--(BUSINESS WIRE)--Technavio’s latest report on the test and measurement (T&M) market in Malaysia provides an analysis on the most important trends expected to impact the market outlook from 2016-2020. Technavio defines an emerging trend as a factor that has the potential to significantly impact the market and contribute to its growth or decline.
Anju Ajaykumar, a lead analyst from Technavio, specializing in research on test and measurement sector, says, “Malaysia's positive investment climate, especially in the manufacturing sector, is expected to have a favorable impact on the market. The ease of doing business in the country is attracting large foreign investments in the manufacturing sector, led by countries such as Japan, China, Germany, and Singapore. In 2014, foreign investments accounted for approximately 60% of the total approved investment.”
Malaysia is rapidly gaining popularity as a regional machinery and equipment (M&E) manufacturing and distribution hub in Asia due to the continuous inflow of both foreign direct investment (FDI) and domestic investment in various sectors. Semiconductor, electrical and electronics (E&E), automotive, oil and gas, aerospace, medical, and food processing are the major sectors in the country. Exports of M&E have exceeded USD 8.97 billion in 2015 and are expected to grow at an average annual growth rate of 6.7% to reach USD 16.1 billion by 2020. Export destinations include Singapore, the US, and China. Imports have also increased from USD 10.6 billion in 2000 to USD 18.2 billion in 2013, indicating a dynamic and rapidly growing manufacturing sector in Malaysia.
The top three emerging trends driving the T&M market in Malaysia according to Technavio heavy industry research analysts are:
- Malaysia as a data outsourcing destination
- Emergence of 5G network
- Interoperability era for T&M equipment
Malaysia as a data outsourcing destination
T&M equipment are extensively used in data centers to ensure adequate capacity, performance, and reliability of data centers and their networking infrastructure. T&M equipment such as electrical energy loggers, infrared imaging systems, cable testing for both copper and fiber installations, return loss testers or more sophisticated optical time-domain reflectometers are extensively used in data centers. The high standards that data centers adhere to also require testing and measurement, thus calling for T&M equipment. Therefore, the T&M vendors in Malaysia are increasingly focusing on the data center market in the country and offering specialized T&M equipment due to the expanding potential of the market.
Several countries such as South Korea and Singapore are aspiring to capture the market by providing a conducive business environment and infrastructure. Malaysia is also a major player in the race to acquire a major market share in this high-potential market. The country's effort to establish itself as the preferred destination for regional investors is fueling its endeavor to become a regional hub for data center and cloud services. It is expected that data center space in the country will increase from 0.5 million sq. ft. in 2015 to 5 million sq. ft. by 2020, driven by broad trends of expansion, efficiency, and consolidation.
“One of the major initiatives is the EPP 3 under the NKEA of business services, which aims to make Malaysia the favored destination for data center investors and increase the internationally certified data center space in the country. This will be achieved by addressing the demand and supply of data center services, as well as raising awareness of the local data center industry,” according to Anju.
Emergence of 5G network
The need to support demand for broadband services over mobile networks as well as the emergence of IoT has triggered the development of 5G networks. These networks enable the use of unused frequency bands, such as the V band, to transport large amounts of data. The emergence of 5G network will drive the demand for wireless test equipment market.
The 5G networks have multi-point connectivity with distributed MIMO. These can deliver several MIMO streams while a single device is connected to multiple sites at the same time, thereby achieving a downlink throughput of as much as 100%. Network operators are collaborating with testing companies for 5G technology testing and development.
Interoperability era for T&M equipment
The extensive range of electronic and electrical products in use today has led to the need for higher interoperability of T&M equipment among end-users, which will eliminate the need for a particular manufacturer’s products for a lifetime.
“The need for interoperability applies to heterogeneous sets of products such as smoke alarms, video monitors, home gateways, and home networking or automation products, as well as homogeneous sets of products such as routers and switches,” asserts Anju.
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- Global Test and Measurement Market 2016-2020
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- Test and Measurement Equipment Market in APAC 2015-2019
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