Vol.7: What will 2025 bring for the Hi-Tech Industry in Europe?

Here are my top ten expectations of the industry for 2025! Join me for a look into my crystal ball!

#1: Figuring out CRA

As CRA covers the whole life cycle of products, and considering a typical time from concept to market introduction of 12-24 months, we will all need to figure out how to implement CRA in detail in 2025 to achieve full compliance in 2027. Still-to-be-released guidelines will be published by the EU, and just the discussion on how to define the “Service Period” properly may keep us busy all year long. In the end, I hope that CRA will meet the objective of protecting European end users but will also strengthen “Made in Europe”

#2: Hype is just… hype

We’re all excited about the possibilities that new, hot technologies hold. You read about it everywhere in the media. Yet, deployments are few and broad adoption is not on the horizon. Advantech marketing, for sure, will also talk about cool stuff like GenAI. But, let’s be clear: what will be adopted on broader basis are technologies that are over the “peak of the hype” like EdgeAI. Oh, yes, I do like Gartner’s hype-cycle concept.

#3: Demographic change will keep rollin’

Although big transformations, like in the automotive industry, may release a fair amount of talent to the labor market, it’s a short-term band-aid. Demographic change is a major force, driving us all to become more appreciative of human resources. Consequently, the thrive for automation and smarter solutions will prevail regardless. It also means that Hi-tech companies need to make efficient use of their key talents in order to stay competitive. Technology ecosystems and partnerships will (continue to) become increasingly important. ?

#4: Infrastructure will become smarter

EU’s paper on the competitiveness on European economy (authored by Mr. Draghi) showed clearly that huge investments are needed to maintain Europe’s position in the world. Climate neutrality and sustainability will force governments to release fundings for making infrastructure smarter. A great application area for architects like myself to bring new technologies into domains with a wealth of legacy constraints.

#5: Total Cost of Ownership (TCO) will be a major factor

A lot of people think that AI and other technologies are all about software. Software that is soft and can be massaged at any time. But once deployed, software maintenance becomes a non-trivial problem, no matter in terms of bug fixing, cybersecurity or feature enhancements. Combined with demographic change, pressure for innovation, deploying commercially supported OSes and middleware will gain popularity over “roll it all your own”. Running your software on consumer grade hardware may be great for a Proof-of-Concept, but industrial grade hardware will be mandatory for deployments to stay in contzrol of life cycle management costs.

#6: Market Consolidation

2024 was not an easy time in the Eurozone. 2025 will still hold lots of uncertainties due do geopolitical conflicts, the wars and continued issues in some of the world’s largest economies. Uncertainty will lead to delayed investments. The “trough of disillusion” (another term from the Gartner hype cycle) may hit companies, which have been suffering already, hard. That may include some smart startups as well es established players that failed to adopt new market trends, e.g. in the autonomous mobile robot industry.

#7: International Competition is intensifying

European manufacturers will have to face fierce competition from Asia, especially China. This trend will continue and push Europe to innovate faster, reduce costs without throwing performance and quality metrics over board.

#8: Do more in less space

Long gone are the days when enhancements in semiconductor processes could give you 30% performance improvements in the same power envelope. Instruction sets of the prevailing processor architectures have been optimized for decades. Not so much to gain there as well. But innovation will require more processing power. Especially when making existing products smarter, this will lead to squeezing more processing power into a given space.

#9: You can’t cheat physics – still

Thank God, Physics is not like news… it can’t be faked. Laws of physics apply, no matter if you build a legacy system or an innovative solution. As such, the desire to do more in less will inevitably create thermal challenges. Smarter system architectures, thermal design capabilities, along with sophisticated validation techniques will be more important than ever.

#10: Nothing’s more constant than change

Well, whatever the situation is now, it will change, probably in unforeseen ways, driven by forces way above our control. The good news is: It’s always been like this and we know how to deal with it. So, I’m curious to see which of my predictions hold true and which ones will get washed away by the surprises that 2025 holds for us. Stay flexible and open minded! Advantech will be here to assist you.

Merry Christmas and a Happy New Year to all!

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