Embedded Software Systems Trends and Developments You Need to Know

The global embedded software market is a rapidly expanding sector, reflecting its critical role in nearly every modern electronic device. According to recent market analyses, the market was valued at approximately $20.7 billion in 2024. It is projected to continue its strong growth trajectory, with forecasts estimating it will reach over $50 billion by 2034, expanding at a Compound Annual Growth Rate (CAGR) of around 9.6%, according to Global Market Insights. Nowadays, people want an easy, out of the box experience, which is possible given that more and more devices are built with embedded software. The interconnectivity of devices empowers companies to deliver more efficient, rewarding and personalized customer experiences, which is why organizations across sectors are exploring how embedded technologies can enhance their offers. Bluetooth LE and Ultra-wideband (UWB) audio are enabling the creation of new use cases for end users, which, combined with using Matter as a standard, mean companies can create products that are easy and fun to use. Given that there’s a lot happening in the embedded space, what are the crucial issues and trends to keep an eye on? Read on to find out. 

Will semiconductor supply chain issues continue? 

Semiconductors have, over the last number of years, become increasingly important in various sectors, especially in automotive and industrial applications – to say nothing of smartphones. Revenue in the semiconductors market is projected to reach $789 billion USD in 2025, reflecting the dynamic landscape. The market is anticipated to experience an annual growth rate (CAGR 2025-2030) of 10.24%, leading to a robust market volume of $1.29 trillion USD by 2030, as reported by Statista.

The semiconductor demand is only going to increase, as emerging technologies like augmented reality (AR), virtual reality (VR), 5G, edge computing and AI continue to develop and present opportunities for consumers and businesses alike. However, supply chain issues that emerged during the COVID-19 pandemic could persist.  Part of the reason stems from increased demand from telecommunications providers and entertainment companies, who seek to meet remote work and online entertainment needs. Another cause is the stockpiling of semiconductor chips. This results from market unease regarding a worsening economic outlook, increased difficulties in sourcing materials needed to produce semiconductors, along with rising geopolitical tensions. Paradoxically, fears of a looming recession could reduce the demand for semiconductors as companies put on hold new developments and expansions, which could mean that an unexpected shortage never materializes. 

Companies need to ensure compliance with new cyber regulations 

As a response to an increasing frequency of cyberattacks, both in terms of hardware and software products and services, the European Commission proposed comprehensive regulations on horizontal cybersecurity requirements for digital products and services. Specifically, the European Cyber Resilience Act (CRA) “aims to set the boundary conditions for the development of secure products with digital elements by ensuring that hardware and software products are placed on the market with fewer vulnerabilities and that manufactures take security seriously throughout a product’s life cycle. It also aims to create conditions allowing users to take cybersecurity into account when selecting and using products with digital elements.” 

This regulation will especially impact manufacturers, importers and distributors of connected hardware and software products that have digital elements, like smart sensors and cameras, as well as mobile and network devices. Since the CRA covers the entire lifecycle of a digital product, security protocols must be applied to all stages of a product’s life, including design, delivery, actual use, maintenance, decommissioning and disposal. Beyond carrying out risk assessments and providing users with security best practices, companies will have to report vulnerabilities and provide more frequent security updates. While the goals of the CRA – that is, making hardware and software security more robust and transparent – are admirable, they nonetheless mean companies need to invest in these measures and turn to qualified embedded software service teams. 

Embedded technology trends worth paying attention to  

There are many exciting developments in the world of embedded software, but a couple deserve special mention: 

Bluetooth Low Energy (LE) Audio – enables wireless audio over a Bluetooth link using low energy radio as opposed to traditional Bluetooth radio, which will deliver lower latency, complexity and memory footprint. This technology presents enormous opportunities for organizations across sectors and a huge amount of use cases, from public announcements at places like train stations and shopping malls, to translation capabilities at international conferences and events, or entertainment at your local gym. These opportunities help explain why the Bluetooth Special Interest Group (SIG) estimates that there will be 5.4 billion Bluetooth device shipments in 2023. SIG also forecasts this output will reach 7.6 billion devices by 2027, with a CAGR of 9%. 

Ultra-wideband (UWB) audio – sends vast amounts of data over short distances, while requiring a tenth of the power used by Bluetooth devices. The possibilities this technology offers for wireless audio are immense. This could be an ideal way to replace headphone cables and other shortrange elements, while still delivering high-quality audio. 

Matter – serves as “a universal connectivity standard to make the use of smart home devices and IoTs simpler. It is an open-source protocol, which allows users to connect different smart home devices and mobile apps with each other” according to Business Standard. More than 200 leading brands, including Google, Apple, Samsung and Ikea, support this standard, as indicated by the use of a unique logo that indicates a devices interoperability with certified Matter products from other manufacturers. Given that Matter delivers simplicity (it is easy to purchase and use), reliability (consistent and responsive local connectivity) and safe (robust security is streamlined for developers and users), it is likely that the number of companies that follow its standard will continue to rise. 

Embedded systems are becoming more and more a part of everyday life, from hearing aids to automobiles. While certain trends may not apply to every type of business, they have the potential to impact everyone’s life, and are thus important to follow. 

Companies need experienced embedded services teams 

The global embedded systems market is expected to reach 163.2 billion USD by 2031, according to Allied Market Research. This surge of interest, and investment, is leading to exciting new developments, while also shining a spotlight on challenges related to security, compliance and supply chain issues. To successfully navigate this dynamic landscape, managers need to look to a trusted source who has real-world experience with emerging tech and who can help identify opportunities. That’s why companies worldwide are turning to Software Mind for outsourcing their embedded software development and finding the best possible solutions. To gain a competitive edge in your industry and benefit from embedded software services, fill out this form to contact us.

FAQ 

Is embedded software in demand? 

Embedded software is in extremely high demand and is projected to grow robustly in the foreseeable future. This is because virtually every modern electronic product relies on embedded software, from consumer gadgets to critical industrial machinery. The key drivers are major technological shifts across several industries. The automotive sector’s transition to electric, connected, and autonomous vehicles has turned cars into complex software platforms. The explosive growth of the IoT has embedded software in billions of smart devices for homes, cities, and factories. Furthermore, continuous innovation in consumer electronics, medical devices, and aerospace creates a relentless need for skilled engineers who can write efficient, reliable and secure code that powers our increasingly connected world. As a result, embedded software development remains a critical and rapidly expanding field. 

Do embedded systems have a future? 

Embedded systems have an expansive future, becoming more critical than ever. Far from being an old technology, they are the fundamental building blocks of our increasingly connected and intelligent world. The future of major technological trends like the IoT, Edge AI, and autonomous vehicles depends entirely on advancing embedded systems. Every smart device, from a simple factory sensor to an electric car’s complex control units, is an embedded system. As we increasingly integrate digital intelligence into all aspects of the physical world, the demand for more powerful, efficient, and secure embedded systems will continue to grow. These systems are crucial for the future and the hardware foundation upon which they are being built.