Analysis on World AC-DC Switching Power Supplies Market

Increased Healthcare and Military Spending Sustains Demand in World AC-DC Switching Power Supplies Market

The consumption of AC-DC switching power supplies is driven by the demand for electrical and electronic equipment used in various applications such as IT, Telecom, Industrial and Consumer Electronics. The market for AC-DC switching power supplies is mature and hence influenced by economic trends. The economic slowdown has reined the progress in the IT/Telecom, consumer electronics and industrial segments, which account for a sizeable portion of the switching power supplies market revenues. However, prospects are likely to improve once the economy recovers. "Though some end-user segments such as light emitting diode (LED) lighting and set-top boxes have displayed positive demand, revenues from other applications including industrial process control, automated test equipment, telecom and networking equipment, and television were weak during the last quarter of 2008 and the first quarter of 2009," notes the analyst of this research.

However, continuing demand from medical applications and the military is likely to sustain the AC-DC switching power supplies market through the prolonged economic downturn. Ageing population and the continuous need for quality healthcare drives steady uptake of power supplies used in diagnostic, imaging and other critical medical equipment. These products are more quality-centered rather than price focused due to the critical nature of the applications. Further, governments across the world have increased military spending to counter terrorist activities, and hence demand from the military segment for sophisticated equipment with complex instrumentation is expected to increase.. This bodes well for the AC-DC switching power supplies market.

Slow Adoption of Digital Power Techniques and Increased Outsourcing to the Asia Pacific Region Impacts Market Dynamics

Power supplies that incorporate digital control offer improved efficiency, reduced parts count, and reduced size. Hence, expectations were high for digital power management and digital control to boost market potential for AC-DC power supplies market a few years ago. However, original equipment manufacturers are hesitant to pay for the extra costs incurred for these additional benefits, restraining the uptake of digital power management and digital control in various applications. Moreover, the digital power supplies are not price competitive when compared to their analog counterparts. Market participants have to intensify efforts to make these products more cost effective to improve the overall market opportunity in digitally controlled switching power supplies.

Another issue that has challenged the market is the increasing price pressure from Asian manufacturers. The overall cost of manufacturing in the Asia Pacific has increased significantly since 2008, but the region remains an attractive location for most manufacturers, especially in the electronic equipment segment. "While design, research, and engineering are still retained by the parent company, manufacturing continues to be outsourced into low-cost Asian regions," observes the analyst. While Asian power supply manufacturers will benefit from this development, it will diminish the potential of the overall AC-DC switching power supplies market. Considering the scenario, it is important for vendors to focus on emerging application segments such as LED lighting and digital control. Also, they must start differentiating their products and make them more reliable. Developing high reliable products for emerging application segments will help generate higher revenues once the economy regains positive momentum.

Market Sectors

Expert Frost & Sullivan analysts thoroughly examine the following market sectors in this research:

By Power Range:

• Low power (1 to 300 watts)
• Medium power (301 to 750 watts)
• High power (751 to 1,500 watts)
• Very high power (1,500 to 2,000 watts)
• Extremely high power (2,001 watts and above

By Geographic Region:

• North America, including the United States, Canada, and Mexico
• Europe, including western, central, and eastern Europe
• Asia Pacific consists of countries on the western border of the Pacific Ocean, including those on the Indo-Chinese peninsula, the Pacific Islands, and Central Asia
• Rest-of-World, including Latin America, Middle East, and Africa

By End-use Application:

• IT/Telecom
• Industrial
• Aerospace and Defense
• Medical
• Others