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COTS: A “reactive” good idea (continued)

To answer the question, we need to look at the..

COTS: A “reactive” good idea (continued)

COTS: A “reactive” good idea (continued)

To answer the question, we need to look at the issues of innovation from a different angle; namely economics and markets.

Free markets are a wonderful concept as long as the motivation and incentives are aligned in the right way for all the players in order to achieve the set objective. So let us look at this issue from the perspectives of all the existing ecosystem players.

In case of the embedded industry, the existing players are

  1. Application users and developers,
  2. Capital equipment manufacturers,
  3. Embedded computing and component manufacturers (OEMs), and
  4. Supply chain players including distributors.

COTS components are used by a wide variety of application developers. The embedded systems and components OEMs have to cater to the overall market demand and cannot satisfy the needs of every customer. Hence the life cycles and the new product road maps for the embedded systems and components are largely driven by advancements and upgrades in a wide range of applications.  The result is that the defense or medical industries have a a limited market share of the overall pie, in terms of the consumption of components. So if there is a substantial demand for newer technology and competitive pressures, the older (smaller) piece of the pie has to be EOL’ed — since long term support takes away valuable resources that can be focused on the latest innovative  products from the OEMs.

What if there is new player in this ecosystem whose business model is geared towards long term support and availability of embedded systems and components far beyond the OEMs can provide? In other words, who takes the “baton” from the OEM, and has the capability and motivation to continue to supply and repair the older products? A player whose incentive is to fill that gap for selected customers — who are not yet ready to upgrade their applications and find it both cost prohibitive and risky to do a last time buy of components, given that demand is typically uncertain?

Customers (application developers) can now avoid forced upgrades and can work with OEMs on new designs while this new player to sustain their legacy systems. OEMs would now have happy customers who are likely going to be more loyal than otherwise.

This allows OEMs to follow their strengths, developing new, innovative solutions for all of their customers – while the customers with the “legacy” market share of the overall pie can reduce the risk of redesign and the increasing challenges of obsolescence.

The GDCA Team


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