Semiconductors seem to have taken the world by storm. Be it smartphones, tablets, flat-screen monitors and television sets, sophisticated cars, new aircraft, and many medical devices?semiconductor-enabled products today play integral roles in virtually every aspect of modern life and their use is expanding constantly. From a market standpoint, the worldwide semiconductor sales for 2013 reached $305.6 billion, the industry?s highest-ever annual total and an increase of 4.8% from the 2012 total of $291.6 billion, estimates The Semiconductor Association, an industry trade body. Semiconductor market in India is growing rapidly too, thanks to our growing electronics consumption.
However, the semiconductor market is volatile and unpredictable, and has had its share of worries during the financial crisis of 2008-09. The industry historically has been cyclical due to sudden changes in customers? manufacturing capacity requirements and spending, which depend in part on capacity utilisation, demand for customers? integrated circuit products, inventory levels relative to demand, and access to affordable capital. Therefore, some of the questions that come to the forefront?How will the market for chips develop in the next few years? Where are the current opportunities?
Francois Guibert, executive vice-president & president, Greater China & South Asia Region at STMicroelectronics (ST), a leading semiconductor major, says, ?While the semiconductor industry is cautiously optimistic overall, we see a few more exciting areas that should drive growth for many years into the future. In addition to smartphones and tablets continuing to shine, the automotive sector is benefiting both from Asia?s unabated growth in car ownership, as well as the expanding pervasion into the vehicle of semiconductor technology for safety, efficiency, and convenience. We are also enthusiastic about the adaptation of existing technologies to connect everything to the Internet?the Internet of Things (IoT).?
Guibert, who has led ST?s operations in Asia Pacific since 2006, says that the mobile sector remains a primary growth driver for semiconductors in Asia as the region continues to pace manufacturing for the world?s smartphones and tablets. ?No one should be surprised by the emergence of Chinese brands in the top-5 list of smartphone makers. From our perch as the market leader for micro-electro-mechanical systems (MEMS) sensors in this segment, STMicroelectronics sees smartphones and tablets incorporating environmental and audio sensors in addition to the motion sensors,? he predicts. ?This range of sensors will deliver smarter services and features tailored to where you are and what you are doing, whether helping you shop for lunch, finding your seats at a concert, or making sure you are dressed for the weather. Already we see sensors in TVs, game consoles, fitness devices, and many other products, and they will undoubtedly find their way into even more areas.?
Another example? Check out wearables. This category of products includes medical devices worn on the body. Take for example the Body Guardian, developed by Preventice in partnership with ST; this device monitors individuals? cardiac arrhythmias. Or fitness devices like the Nike+Fuelband that measures activity level during exercise. These devices incorporate multiple sensors and minimise power consumption to extend mobility and miniaturisation. The development of wearables has benefited greatly from the availability of ultra-low power microcontrollers, low-power RF-communication technologies, very low-power sensors and exceptional power-management control, says the ST South Asia region head.
The automobile revolution has also given a lift to semiconductor sales. Favourable factors for the increase in semiconductor content in cars include the increased use of electronic systems in conventional cars, such as improved safety systems and consumer electronics, particularly in the high-end segments. The 5-year CAAGR (compounded average annual growth rate) for automotive over the 2012-2017 period is forecast at a blistering 15.6% for China and 14.3% for India, while Thailand, which has the largest car industry in the ASEAN block, is 9.8%.
As the world?s largest car market, China will be the main driver of automotive growth in Asia. As the Chinese market matures, demand for advanced safety features in airbags, brakes, and various active safety systems, adapted to local needs, will also increase.
Consumers will also require greater comfort and a more enjoyable experience as China?s automotive market
becomes more sophisticated, driving customisation in infotainment and body electronics.
According to Guibert, while the number of cars purchased will increase, the strong shift towards greener, safer, and more comfortable cars will push even more advanced semiconductors into each new car sold. As the market leader in the both the China and India automotive markets, STMicroelectronics is further enhancing its capabilities in meeting the unique demands of this exciting region, he insists.
Also, the Internet of Things (IoT) will drastically change how we interact with objects, devices and the world around us. Cisco has anticipated 50 billion Internet-connected things by 2020 and Forrester Research forecasts that the production value of these connected things will be 30 times greater than the current total production value of the Internet-related industry.
?Leveraging existing sensor and connectivity technologies, the IoT heralds an era using integrated smart sensor systems to extract raw data from multiple sensors in the world around us, process and analyse that data, and make decisions to determine, deliver and control parts of our active, healthy, and efficient lifestyle,? says Guibert. STMicroelectronics sees the IoT as the next step in the natural progression of smart features in electronic devices. ?We are ready for the IoT wave with an ideal portfolio of products and technologies that includes integrated smart systems incorporating multiple sensors, processing and communication technologies.?
In short, growth prospects for the semiconductor sector are positive.
