A sunrise industry is frequently distinguished by a high level of innovation, and its quick growth may threaten to push a rival industry sector that is already in decline into obsolescence. The rival industry sector is known as a sunset industry due to its bleak long-term prospects.
The phrase was created in 1983 to represent the then-emerging, prosperous manufacturing sectors that were thought to provide the foundation of the coming economic rise. This is also used as the opposite of the term "sunset industry". The change from the sunrise to sunset stages is expected to happen faster in industries with high levels of competition, like telecommunications.
Did You Know? Most startup companies fall within the categories of sunrise industry since they don’t have a mature market when they started.
Life Cycle of Sunrise Industry
Sunrise Industry is more in the introduction stage of an industry where there is a limited number of frequent buyers and a significant growth rate. The products in the sunrise industry create buzz but have very limited practical usage, especially large-scale commercial usage. Later, when the industry enters a maturity stage where the market growth rate cools down but the products have wide acceptance and have a significant number of frequent buyers. At the later stage, the Industry gets characterized by a sharp downward drift of slow growth and little to no innovation, called the sunset Industry.
Evolution of Sunrise Industry
The industry will move from the introduction or sunrise stage to maturity and then, eventually, the sunset stage as it develops and ages over years or decades. The compact disk industry is a typical illustration of this transformation.The evolution of a sunrise industry can be influenced by various factors, such as technological advancements, changes in consumer preferences, government policies, and economic conditions. To succeed in a sunrise industry, companies must be able to adapt to these changing conditions and stay ahead of the competition.
However, the 21st century's growing digital, non-physical media may mean that the compact-disk industry's days are over. Despite the initial interest they receive, the sunrise industries still need to demonstrate that they are viable, competitive marketplaces. The initial excitement they generate could be mostly focused on market prospects and business sentiments.
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Examples of Sunrise Industries
The sunrise Industry is characterised by rapid product innovations and a buzz around its development like Hydrogen fuel these days. These excitements push strong business sentiment into the industry which drives huge sums of investments to the Industry. The investment in turn brings more innovation and faster industry development into the matured state. Following are a few examples of Sunrise Industries :
Hydrogen Fuel
Fuel made of hydrogen and oxygen is referred to as hydrogen fuel. As long as it is produced using a carbon free procedure, it can be utilised in internal combustion engines or fuel cells. In terms of hydrogen-powered vehicles, gas has started to be employed in commercial fuel cell vehicles like passenger cars and has long been used in fuel cell buses. Additionally, it serves as a propulsion fuel for spacecraft, and hydrogen-powered aeroplanes.
The commercial use of hydrogen fuel is not yet feasible owing to the lack of commercial production in relatively economical ways. Yet, the industry is buzzed around due to the growing sentiment around carbon emissions.
Space Tourism
Human space travel for recreational purposes is known as space tourism. Space tourism comes in a variety of forms, including orbital, suborbital, and lunar space tourism. It is not yet common to travel into space just like you travel to the rest of the world for fun. Many companies like Virgin Galactic, SpaceX, Blue Origin, and others are working toward the development of feasible ways to travel in space.
Cyber System Security
The companies that provide cybersecurity for cyber physical systems, or systems with both software and hardware components, such as smart grids, self-driving cars, and drone fleets, make up the cyber-physical systems security sector. The primary force behind the expansion of this industry is the startup culture. The following are a few examples of the goods and services offered by the sector -
- Establishing and utilising security measures including firewalls, sandboxes, and intrusion prevention systems.
- Keeping an eye on and maintaining the networks and system security.
- Improving the foundational frameworks for cyber-risk awareness and the rules for compliance, governance, and risk management
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Digital Infrastructure and Connectivity
Digital infrastructures have fueled the ever-growing IT sector in India. Like electricity, smooth internet connectivity is an important infrastructure to run a business in a modern IT environment. Fiber optic networks, satellite services, data centers, etc are an example of digital infrastructure.
Let’s take for an example, the mobile sector grew gradually as the medium matured and became more reliable. The development of mobile apps was made possible when the underlying wireless communications networks made it possible for large amounts of data to be delivered quickly and securely. While various individual applications or app categories gain and lose popularity with the general public, the wireless data medium accessible through mobile devices is expanding.
Characteristics of Sunrise Industry
Sunrise industries still need to demonstrate that its markets are enduring and viable notwithstanding the initial attention they receive. The first buzz they create may be more based on conjecture about the potential the sector holds than on actual commercial action. Overall they have wide impacts on the industrial sector. Let us cover some of its vital characteristics:
Rapid Innovation
Innovations such as new technology and novel approaches to problem-solving and problem-looking help the sunrise industry. While people of all ages may participate, many organisations tend to have a high proportion of young people who have fresh ideas and business strategies. As businesses fight for a footing, carve out niches in the market, and new developments frequently see significant turnover, funding is erratic. In a young industry, trends come and go quickly, but ultimately a number of businesses and concepts surface and gain importance.
Speculation
Sunrise industries have a lot of chances, grow quickly, and experience swiftly shifting fortunes. Investors can't always foresee how these sectors will develop, but those who do stand to gain from their astute predictions. For instance, those who made investments in large technological businesses when they were still relatively tiny saw their stock portfolios expand significantly.
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Decline of Sunset Industry
An industry that is only getting started will eventually mature. The number of businesses in an industry often declines with time, and many of them depend on a small number of flagship items to uphold their reputations and bring in consistent revenue. The industry declines and becomes a sunset industry when new innovations and ideas start to replace it.
Conclusion
Sunrise Industry is characterised as an Industry with rapid innovation and product development for which the market is not yet saturated with only a handful of frequent buyers. These industries have high growth potential and that is the reason why they create buzz. To survive in a sunset industry, companies may need to adapt and innovate to meet changing market conditions. This may involve diversifying their product or service offerings, adopting new technologies, or entering new markets. Companies may also need to restructure and streamline their operations in order to reduce costs and increase efficiency.
Hence the evolution of the sunrise industry is going to be visible in the coming days.
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