Enduring opportunities for mature technologies

While the avionics industry is almost compulsive about the pivotal role of leading-edge technologies, there remain market niches where traditional technologies are thriving — and returning substantial profits to the participants.

Apr 1st, 2003
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John Rhea
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"At a minimum, there is the uncomfortable feeling among users that they may be the guinea pigs for technologies that have not been fully validated and qualified."

WASHINGTON — While the avionics industry is almost compulsive about the pivotal role of leading-edge technologies, there remain market niches where traditional technologies are thriving — and returning substantial profits to the participants.

An extreme example is the bench and ramp test instrumentation segment that is only beginning to move away from 1960s-vintage technology — light-emitting diodes to liquid crystal displays and discrete transistors to microprocessors — even though the customers seem happy with what they have now.

As is common among mature industries, three firms dominate this segment: the IFR subsidiary of Aeroflex Corp. in Wichita, Kan.; Telinstrument Electronics Corp. in Carlstadt, N.J.; and the JC Air subsidiary of B.F. Goodrich in Olathe, Kan.

Bob Vogel, vice president for marketing at Aeroflex corporate headquarters in Plainview, N.Y., estimates the total annual business at $27 million, of which his firm has at least half in all the served markets: test equipment for Global Positioning System (GPS) flight equipment, weather radar, navigation and communications, traffic alert collision avoidance, and identification (performed by transponders).

This, in turn, is a subset of the overall avionics test and measurement market, which Jeff Gillum, director of wireless products at IFR, estimates at around $300 million a year.

Ron Carlson, director of business development at Telinstrument, responds that it depends on how you define the market. "These aren't numbers I would like to take to the bank," he says, but he is quick to point out that this is a mature market.

The aerospace industry itself has declined in importance in recent years, Carlson adds, dropping from 2.2 percent to 1.7 percent of the nation's gross domestic product. Now the big technological and market drivers are the telecommunications segments.

In attempting to insert some new technology into the test market, IFR officials in early February introduced a new line of testers known as the 4000 series at the Aerospace Testing Expo in Hamburg, Germany. Company engineers designed the new models to replace the company's own IFR 400 line, which has been available since 1974.

The new line, for which company officials are quoting eight-week delivery beginning this month, costs $11,500 per unit. That's $1,700 less than the current product. It's also less than half the weight (eight pounds vs. eighteen pounds) and has a longer battery life (eight hours vs. one and a half hours).

So why fix it if it ain't broke? Gillum concedes that "our biggest competitor" will be the company's own installed base. British Airways, for example, has 40 of the earlier-model test sets and will likely need some persuading to trade up. IFR, which began working on the new line shortly before it was acquired by Aeroflex last June, is still grappling with the issue of accepting the old models as trade-ins.

Aeroflex officials claim about 400 customers worldwide for their existing product line, including all the major airlines and airports, the U.S. military services and National Guard, the U.S. Coast Guard, and such foreign military forces as those of Australia and the United Kingdom.

But company leaders have bigger markets in mind, even as they phase out their relatively old systems, by using the new technology in the new line, Gillum says. He cites opportunities as front-line testers for military ground vehicles and other non-aerospace applications.

The advantages of lighter, more rugged testers are evident in such demanding environments as aircraft carrier decks, and in the comparably challenging conditions that prevail in ground warfare.

What makes this new line of testers significant is their ability to do digitally what had been traditional analog functions: instrument landing system (ILS), VHF omnidirectional range (VOR) and marker beacon receivers, and VHF AM/FM and UHF transceivers. VOR and ILS requirements have not changed since the 1950s, Vogel says.

However, this market is not entirely static and immune to further introductions of new technology. Carlson at Telinstrument cites the need on the part of airlines to pack more flight information within the existing assigned frequencies as air traffic congestion increases.

Leaders of the Federal Aviation Administration in the U.S. are grappling with ways to apply the technology of time division multiple access (TDMA) to the problem of air traffic congestion. TDMA, Vogel says, would yield the bandwidth of four channels on only one frequency. In Europe, where the congestion problem is even more severe than it is in the U.S., airlines are experimenting with interim solutions. Whatever the final outcome of these efforts, new test equipment will be necessary.

Another factor in the avionics test market — perhaps a negative one — is a trend toward ever-larger jumbo jets such as the Airbus 380. This aircraft, currently in development, is to carry more than 600 passengers and challenge Boeing's traditional domination of this market. Fewer aircraft would mean fewer testers, Carlson notes.

The trends in the avionics test market, while not necessarily representative of the entire avionics industry, nonetheless bear watching for possible applications elsewhere. There may be better solutions to emerging problems than a compulsive quest for ever-more leading-edge technologies.

At a minimum, there is the uncomfortable feeling among users that they may be the guinea pigs for technologies that have not been fully validated and qualified.

In a larger context, it's useful to remember the unofficial motto of the Russian space program, which was derived from an old French saying: the better is the enemy of the good.

There's a story that once made the rounds of the U.S. space industry about how NASA was spending millions of dollars to develop ball point pens that would work in the microgravity environment of space. Somebody asked one of the Russian scientists how they handled the problem. "We use pencils," he shrugged.

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