How robotics as a service expands potential applications
As more organizations in different industries consider emerging applications for robotics technology, new business models for vendors are also envisioned. Robotics as a service (RaaS) is an elastic concept. It refers to robotics systems providers that in addition to selling products, will now rent or lease their product to customers as a full-service solution.
Though the total market continues to grow, competitive pressure on robotics vendors to maintain profit margins means that they'll have to broaden growth opportunities beyond selling robots as products. Following a recent worldwide market study, ABI Research highlights the potential of RaaS in unlocking the next phase of robotics adoption.
Robotics market development
Overall, ABI Research estimates that the installed base for RaaS will grow from 4,442 units in 2016 to 1.3 million in 2026. The yearly revenue from RaaS providers is expected to increase from $217 million in 2016 to nearly $34 billion in 2026.
"This will make the yearly revenue of RaaS providers -- including all payments for services -- greater than the shipment revenues for industrial robots, which currently accounts for the lion's share of the robotics industry in terms of revenue," said Rian Whitton, research analyst at ABI Research.
The RaaS installed base over 10 years between 2016 and 2026 is characterized by a of 66 percent CAGR. This is particularly prevalent in the markets with the largest RaaS installed base -- namely logistics, manufacturing, and hospitality, over the 10-year forecast period.
The biggest benefit of RaaS is that end users can now shift their capital expenditure (CAPEX) to an operational expenditure (OPEX), allowing them to deploy solutions without large upfront costs. RaaS providers, in turn, benefit from a steady stream of income from service offerings.
The benefits of RaaS are undeniable for end-users and robotic systems providers alike, and ABI Research forecasts that it will become much more popular in a relatively short space of time.
However, to achieve new growth, providers must start to educate the market on the benefits of migrating to an OPEX model, instead of a CAPEX-driven model. Companies such as Aethon, Locus Robotics, Savioke, and Sarcos Robotics are offering a RaaS model for their enterprise clients.
This model creates a lower barrier to adoption as well as provides an opportunity for robotics suppliers to establish a long-term service relationship with their end users, with more flexibility, scalability, and upgradeability in mind.
Outlook for robotic technology applications
Logistics is currently the biggest market sector, but there are plenty of potential across various verticals. According to the ABI assessment, RaaS is the next phase of market development, opening robotics up to new use cases. Therefore, manufacturing, logistics, and healthcare are not the only market sectors to benefit from RaaS offerings.
RaaS will bring robotics to new market sectors that have not previously had significant robotic systems adoption -- those vertical industry applications include agriculture, security & surveillance, retail, hospitality, oil & gas, and waste management.
- » COVID-19: Telcos increase the pay of engineers helping to keep people connected
- » EU asks Netflix to lower its quality as people isolate from coronavirus
- » Speedtest: Coronavirus is slowing internet speeds across the US and Europe
- » British internet providers commit to measures helping people isolate
- » Global smart city tech spending to reach $124 billion: Analysing the market outlook