Category Archives: LED Manufacturing

February 10, 2012 — The manufacturing conference at Strategies in Light focused on methods for reducing cost through the manufacturing supply chain. Presenters discussed various methods of reducing manufacturing costs, from improved automation and standards implementation, automation to new packaging technologies. Light emitting diode (LED) manufacturers must be aggressive to achieve such cost targets as the $2 per kilolumen which is highlighted in the R&D roadmap by the US Department of Energy (DOE).

This article originally appeared on LEDs Magazine, www.ledsmagazine.com.

In his keynote talk, Iain Black, vice president of manufacturing engineering and innovation at Philips Lumileds, said that one way LED manufacturers can be more efficient is to develop more flexible, scalable and responsive manufacturing processes. He said that his company is moving the differentiation of its products to the latter portions of the product flow, which allows for faster cycle times, potentially higher yields and better management of LED inventories. “This will simplify the front end processes, while also reducing the number of different die types,” he said.

Black said that manufacturing complexity is one of the greatest challenges he faces with a very diverse array of LED applications and thousands of LEDs, which need to be matched together. Philips Lumileds is moving to more standardized products that become differentiated toward the end of the manufacturing process. “We still will have custom solutions in cases of very large customers or niche products, but the practice of customizing single-die emitters for lighting is no longer practical,” he added. He said that Philips Lumileds is going to begin to emphasize LED arrays more, another strategy that will allow for product differentiation later in the process.

Black’s presentation was followed by an overview of LED fab activity by president of SEMI America, Karen Savala. SEMI has estimated that there are 142 LED fabs in operation worldwide, though some new fab tooling has been stalled recently due to the market slow down. “We see some overcapacity, but we believe this will be a short term issue,” she said. Savala also provided an update of sapphire substrate prices, which had fallen to a new low of $10 per 2" substrate by the end of 2011.

Savala talked about the some of the cost benefits that the LED industry could gain from standardization. She noted that current there are over 30 different 6" sapphire wafers products on the market, due to lack of standardization. In 2010, SEMI organized the HB-LED standards committee and there are currently four task forces for LED manufacturing. They cover the geometric standards for 6" sapphire wafers, hardware and software interfaces for automation, defect metrology for sapphire wafers and ESH (environmental, safety and health) aspects of LED manufacturing.
 
Jacob Tarn, president of TSMC Solid State Lighting Ltd. also discussed cost reduction strategies that TSMC has borrowed from semiconductor manufacturing and plans to apply to LED manufacturing. Tarn noted, however, critical differences between LED and semiconductor manufacturing. Most importantly, LED manufacturing requires extensive knowledge of materials engineering, bandgap engineering, defect engineering and stress management, all of which can affect LED light quality, reliability and lifetime. He said, for instance, that the understanding of defect behavior within specific materials is still being developed, as is the understanding of interface behavior between heterojunctions.

Figure 1. LED manufacturing could benefit from an integrated development environment. Source: TSMC.

Tarn added that there is a need for an integrated development environment in LED manufacturing (Fig. 1) that includes device and process simulation such as that which exists in semiconductor manufacturing. “The GaN industry has not had enough databases to build the infrastructure so many developments have been empirical,” he stated.

TSMC has plans to utilize the advantages of 8" manufacturing throughputs in LED manufacturing. For instance, Tarn talked about growing epilayers on 4" or 6" substrates, then transferring the GaN epilayer to 8" wafers for further wafer processing including wafer-level packaging processes. Other mainstays of the semiconductor process control world, including run-to-run control, data mining and equipment tracking can be applied to LED manufacturing.

Tarn’s presentation was followed by a review of the DOE’s manufacturing roadmap by Jim Brodrick, the US DOE’s solid-state lighting program manager. “High first cost is the most frequently cited impediment to adoption of solid-state lighting,” said Brodrick. He added that the roadmap allows companies to identify common goals and best practices while addressing roadblocks. Two priorities in the roadmap include the development of flexible and cost-effective manufacturing methods for LED modules, light engines and luminaires as well as high-speed, non-destructive test equipment for key stages in the manufacturing process.

Brodrick emphasized that cost reduction while maintaining high-quality manufacturing all comes down to one metric: binning yield. The roadmap outlines improvements in upstream process control, non-destructive testing, manufacturing automation, and advanced packaging schemes that can lead to such higher binning yields. Some of the DOE active projects are summarized in the table.

 

Applied Materials Inc. Advanced epi tools for gallium nitride (GaN) LED devices
GE Global Research Roll-to-roll solution-processable small-molecule OLEDs
GE Lumination Development of advanced manufacturing methods for warm-white LEDs for general lighting
KLA-Tencor Corporation Automated yield management and defect source analysis inspection tooling and software for LED manufacturing
Philips Lumileds Lighting Company Low-cost illumination-grade LEDs
Ultratech Inc A low-cost lithography tool for high-brightness LED manufacturing
Universal Display Corporation Creation of a US phosphorescent OLED lighting panel manufacturing facility
Veeco Instruments Implementation of process-simulation tools and temperature-control methods for high-yield MOCVD growth
Veeco Process Equipment Development of production PVD-AlN buffer layer system and processes to reduce epitaxy costs and increase LED efficiency
Moser Baer Technologies Process and product yield improvements for low-cost manufacturing of OLEDs
Table. Projects and the companies working on them.

Raja Parvez, CEO of Rubicon Technology talked about the advantages of progressing to larger-diameter sapphire substrates. “I believe the LED industry will follow the same path as the semiconductor industry in progressing to larger wafers to reduce costs,” said Parvez. Interestingly, however, semiconductor manufacturers had two drivers pushing them to larger and larger wafers — increasing semiconductor die size and the need to produce more die at a lower cost. LED manufacturers only share one of these drivers because the LED die size is not increasing incrementally.

Abdul Lateef, CEO of Plasma-Therm, a maker of PECVD tools, discussed the need for different equipment platforms based on the stage of LED manufacturing. For instance, Plasma-Therm offers both single wafer PECVD systems as well as batch tools. He provided an example of how in-situ metrology is helping to automate the process. “We have equipped the tools with optical emission interferometry which uses the light from the plasma to monitor film thickness,” he said. Lateef also commented that in many instances, LED manufacturers would purchase only a single tool for a single processing step in early stages of manufacturing, which makes tool monitoring and data tracking more difficult. As LED manufacturers have ramped capacity and purchased more tools, the implementation of intelligent data analysis, centralized recipe management, tool utilization tracking and maintenance scheduling become more manageable.
 
Laura Peters is a Senior Technical Editor with LEDs Magazine. Contact her at [email protected].

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February 9, 2012 – BUSINESS WIRE — Rubicon Technology, Inc. (RBCN), sapphire substrate and product supplier to LED, RFIC, semiconductor, and optical industries, entered into a new contract with its largest customer for large-diameter sapphire wafers. Shipments, covering June to December 2012, will total at minimum $20 million.

The 6" sapphire wafer customer is "valued," said Raja Parvez, president and CEO of Rubicon, though the "inflection point in demand for large-diameter sapphire wafers for LEDs is still some months in the future."

The previous contract expired at the end of December. Rubicon granted adjustments to Q4 2011 price and volume requirements under the expiring 6" wafer contract, as management had indicated was likely in remarks made November 8.

Rubicon also has written off $1.8 million of accounts receivable in Q4 as an accommodation to certain key customers of its small-diameter sapphire ingots (cores). Parvez noted excess inventory in the LED supply chain in Q4 2011, leading to a temporary decline in demand and lower sapphire prices.

While near-term LED market demand is limited, "orders for 2" and 4" cores have begun to recover in Q1 2012…Demand for large-diameter wafers for the Silicon on Sapphire (SoS) RFIC market is growing," Parvez said. Rubicon expects a significant uptick in the market for sapphire substrates later in 2012.

Rubicon Technology, Inc. is an advanced electronic materials provider that is engaged in developing, manufacturing and selling monocrystalline sapphire and other crystalline products for light-emitting diodes (LEDs), radio frequency integrated circuits (RFICs), blue laser diodes, optoelectronics and other optical applications. Further information is available at www.rubicon-es2.com.

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February 9, 2012 — Minsheng Financial Leasing Co. Ltd. (MSFL), China’s main non-banking financial institution, formed a strategic alliance with semiconductor fab deposition tool supplier AIXTRON SE (FSE:AIXA; NASDAQ:AIXG), making leasing options available to AIXTRON’s customers in China.

MSFL’s financial services will help customers in China, primarily light emitting diode (LED) manufacturers, obtain metal-organic chemical vapor deposition (MOCVD) tools from AIXTRON. Tools include the CRIUS II-XL (Close Coupled Showerhead) and the AIX G5 HT (Planetary Reactor) systems among other options.

Photo. Feng Wang, (CPO, president of Finance Leases SBU MSFL) and Wolfgang Breme (CFO AIXTRON) signed the Memorandum of Understanding at a ceremony held at MSFL’s headquarters in Beijing.

The agreement helps LED makers acquire MOCVD equipment despite "temporary restrictions in China in the availability of financing," noted Rong Wang, CFO of MSFL. Breme added that leasing MOCVD tools is "a relatively new concept" in China. LED technology has been defined as one of the key industries (energy conservation/environmental protection, new materials) in China’s 12th 5-year plan aiming to ensure long-term prosperity. In 2011, China was the biggest single regional buyer of MOCVD equipment, accounting for 58% of all global shipments within that period.

China’s LED market showed 45% annual growth in 2011 and is expected to grow in output value from CNY 120 billion in 2010 to CNY 500 billion during the course of the 12th 5-year plan.

Minsheng Financial Leasing was established in April 2008 and is one of the first five leasing companies approved by the China Banking Regulatory Commission (CBRC) in China. MSFL is co-sponsored by China Minsheng Banking Corporation Ltd. (81.25%) and Tianjin Port Free Trade Zone Investment Co., Ltd. (18.75%) with total registered capital of CNY 3.2 billion. In 2009, MSFL’s total financial leasing business amounted to CNY 18.5 billion and comprised assets amounting to CNY 23.6 billion. The company provides professional and quality financial leasing products and services to domestic and foreign large and SME enterprises.

AIXTRON makes production equipment for compound, silicon or organic semiconductors and carbon nanostructures including graphene. For further information on AIXTRON (FSE: AIXA, ISIN DE000A0WMPJ6; NASDAQ: AIXG, ISIN US0096061041) visit www.aixtron.com.

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February 9, 2012 — Day 2 of the 2012 Strategies in Light conference, and the first day of technical sessions, began with an adrenaline rush. The challenge posed to the audience was to identify the first ever Super Bowl TV commercial to feature a light emitting diode (LED) light. The first respondent would win $100, and it took only a few mental CPU cycles for someone to correctly shout out “Audi.” The conference has over 4,000 advance registrations, with a total of 5,000 attendees expected for conferences and to view the record 170 exhibitors.

Read Fury’s report from Day 1: Strategies in Light: Day 1, LED Lighting Report, New Start-ups

and from Day 3: Lithography, direct-attach LED architectures, packaging trends

The session was opened by Ella Shum, LED practice director at Strategies Unlimited. One prognosis is that China will soon be taking over the global sign market; it commanded 87% of the W/W market in 2011. Many smart phones are going to OLED displays. It was suggested that the iPhone will not go OLED until someone other than Samsung commands the majority of OLED manufacturing capacity. Even though the LED lighting market is growing at a 20% CAGR to 2016, the LED chip market is flat (CAGR -0.2%) because of price pressure even as unit growth is strongly positive.

Ling Wu, Secretary General of the Chinese Solid State Lighting Alliance, provided an overview of their strategy as captured in the next Five Year Plan. Energy savings is the dominant driver, with a target of 100B kWh saved. The 20M rural families still without electricity are driving a market for off-grid LED lighting.

Eric Kim of Soraa, Inc. took a holistic approach to LED lighting for space illumination. Readers are referred to an article in today’s (Feb 08, 2012) Wall Street Journal on the company. Unlike most LEDs that use blue emission to pump phosphors for their range of colors, the Soraa products use violet light to pump a different set of phosphors, giving characteristics distinct from others in the market.

Editor of LEDs Magazine Tim Whitaker provided his observations on the European LED lighting industry. General lighting LED market share is just shy of 10% in 2011, in spite of being two years into a mandated conversion roadmap away from incandescents. This transition is expected to inject €20B into the European economy.

Ned Tozun of d.light Design is turning to LED solutions for off-grid household lighting in third world rural areas. There is still a surprisingly large population that has no access to electricity, or unreliable limited access. The primary means for night lighting are kerosene lanterns and electric bulbs powered by lead acid batteries that must be carried to a local diesel generator  for daily recharging. In India, the government subsidy to keep kerosene prices affordable is ~$6B, approximately the same as the national budget for education. The sociological benefits from relatively low-tech implementations of solar chargers and LED lighting at night extend to increased study time and improved health for children due to the elimination of kerosene (which is typically several grades below what is available in the US in terms of adulterated effluents).

Figure 1. Population without electricity.

Overheard mid-morning: “I’m surrounded by a bunch of technical propeller-heads talking about LED chip manufacturing and I’m not sure I can keep up.” Funny, I felt like I was surrounded by marketeers who were excited about upside market potential but had no idea what the inside of a fab looks like, at least through the morning plenary session. Fortunately, I was able to take refuge all afternoon in the LED Manufacturing track, where my propeller spun freely.

Seth Coe-Sullivan of QD Vision opened the session on phosphors with his overview of the only company focused on quantum dots exclusively for the lighting industry. Their quantum dots can operate in both photoluminescent and electroluminescent (for QLEDs) modes. The underlying physics is said to provide greater efficiency and spectral purity than phosphor technology.

Iain Black of Philips Lumileds Lighting talked about the challenges of LED manufacturing from the perspective of rapidly delivering products to market that are responsive to rather fast changes in consumer mood. One important element is to move the product customization point as late in the production process as possible, allowing many products to draw from a common substock. Lumileds manufactures on 150mm wafers; most LED fabs still run smaller wafers.

Karen Savala, President of SEMI Americas gave the supplier-side perspective on consolidation, expansion and long-term planning for LED manufacturing. Global manufacturing is normalized to 4” wafer equivalents; capacity is expected to reach 2M wafers/month this year. Sapphire LED substrates are expected to reach 50% 6” wafers in 2014, and this wafer size is where the SEMI Standards activity is focused for LED.

Figure 2. LED dedicated fabs, 10-year span. SOURCE: SEMI Opto/LED Fab Forecast, November 2011.

Jacob Tam, President of TSMC Solid State Lighting Ltd., explored the question of whether a large semiconductor manufacturer can accelerate LED cost reduction. He started with a very nice spider chart comparing the state of manufacturing in the two technologies. Various manufacturing and design tools were compared between the two, but in the end he remained quite silent on the details of what TSMC had in mind for its own LED manufacturing future. One expectation is that binning control will be much tighter when leveraging TSMC’s process control experience.

Figure 3. The fundamental differences between semiconductors and LEDs.

James Broderick of US DOE talked about the government-industry roadmap for improving solid-state lighting manufacturing in the US. The underlying motivator is the creation of sustainable US manufacturing jobs. The metrics call for OEM lamps priced at $5 by 2020, compared to $23 today. There are ~$45M in projects funded today, with a planned pathway to $114M. A funded KLA inspection tool tested at Philips Lumileds reduced production costs by 10%.

Figure 4. DOE funding by program pathway.

Raja Parvez, CEO of Rubicon Technology spoke about the move to larger diameter sapphire wafers. Solid state lighting is the largest consumer of their products, followed by silicon on sapphire and optical windows (aerospace). Rubicon expects 6” wafer share to be 70% by 2020, with a subsequent trend to 8”, following the semiconductor trend.

Figure 5. Sapphire wafer diameter trends. SOURCE: Yole Developpement.
LED chip manufacturers transitioning to larger-diameter substrates to reduce cost
 –Several chip manufacturers announced plans to move into volume production on 6" substrates in 2011
 –We have been supplying R&D volumes of 8" epi-polished wafers and are ready for high-volume production.

Abdul Lateef of Plasma-Therm talked about the advancements of front end PECVD deposition in adapting to LED manufacturing. Real time process control using optical emission interferometry is one of the innovations contributing to higher production repeatability and yield, with a control resolution of 50nm.

Michael A. Fury, Ph.D., is director & senior technology analyst, Techcet Group in North Plains, OR.

Visit the new LEDs Manufacturing Channel on ElectroIQ.com!

UPDATE February 8, 2012 — Chung Hoon Lee, CEO of LED manufacturer Seoul Semiconductor Co. Ltd. keynoted at the Strategies in Light Conference and Exhibition in Santa Clara, CA, today. Lee’s keynote, "A View from Seoul," marks the first time a Korean LED maker has spoken at the conference.

As the CEO of Seoul Semiconductor, Lee has guided the company from $1 million in revenue since the company’s inception, to over $700 million today. Lee holds the first patent technology for white LEDs in Korea and drove the innovation of Acrich, a mass-produced AC LED, for which he was awarded the Silver Tower Order of Industrial Service Merit in South Korea.

Mr. Lee described the "unique technology" of Seoul Semiconductor — UV LEDs, non-polar LEDs, and AC LEDs named Acrich that do not need a converter. "We spend 10-20% of our revenue for R&D. Based on this R&D we now have more than 10,000 IPs," he said.

Also read: Seoul Semiconductor LED patents top 10K mark

"People say Acrich is an Asia technology, but that’s wrong," Lee said. Acrich is the world’s first semiconductor light source that operates directly from AC power without a converter. This makes it suitable for many residential and commercial lighting applications where the main source of available power is AC. A design with Acrich LEDs minimizes component count and board space.

Speaking on the future of lighting systems, Lee showed a chart that compared Acrich to the converter-based technology of other companies (Company A through Company E). Holding up the components of an AC/DC converter system, Lee asked “What is this?” His answer, “This is junk,” was met with applause. Lee explained that the less-than-10K-hours lifetime of convertors sabotages the 50,000 hour lifetime of LEDs. Acrich, by comparison, uses a “tiny IC chip.” He said Acrich provides better power factors, better power efficiency and better THD. “We can reduce the heatsink, protect the environment and provide more design freedom,” Lee said.

Led also described an evolution in white LED chips, saying he believed the 3rd generation will be phosphor-free. How? He showed two approaches: a 3-chip (RGB) solution, and one based on quantum dots (QD). “Which will be successful? We cannot say yet,” he concluded.

Strategies in Light Conference and Exhibition focuses on developments in high brightness light-emitting diode (HB-LED) applications, technology and manufacturing. Stay tuned for daily news and product announcements from the show, such as:

Seoul Semiconductor is an LED supplier and holds more than 10,000 patents. Seoul Semiconductor owns a wide range of LED technology and production capacity in the following areas: high brightness LEDs and mid-power top view LEDs as well as Acrich. The company is pioneering in the productization of deep UV LEDs and non-polar LEDs.

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February 8, 2012 — Raja Parvez, president and CEO of Rubicon Technology Inc. (RBCN), sapphire substrates and products supplier, will speak about the "Move to Larger Diameter Sapphire Substrates" at the Strategies in Light 2012 in Santa Clara, CA, today at 4PM during the LED Manufacturing track.

Following is a preview of his presentation:
To support mass adoption of solid state lighting, a shift to larger diameter sapphire wafers must occur. Manufacturing efficiencies and cost reductions inherent in the large diameter platform set the stage for scaling up of the entire LED supply chain to meet the growing demand for LED chips. Parvez will review why a large diameter wafer is essential to driving down costs and increasing yields to support aggressive cost targets of SSL, and will address trends that are on the horizon.

Rubicon has shipped more than 230,000 large diameter wafers, produced from the raw material, through cutting and finishing polished wafers.

Bringing down the overall price of LEDs is a key element in supporting the worldwide commercial adoption of solid state lighting based on LEDs as a light source. According to market research firm DisplaySearch, the total average LED penetration in lighting was 1.4% in 2010 and is forecast to reach 9.3% in 2014. Government entities around the world including China, European Union, Australia, Canada and the United States have introduced legislation to require energy efficient lighting.

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Rubicon Technology (RBCN) is an advanced electronic materials provider that is engaged in developing, manufacturing and selling monocrystalline sapphire and other crystalline products for light-emitting diodes (LEDs), radio frequency integrated circuits (RFICs), blue laser diodes, optoelectronics and other optical applications. Further information is available at www.rubicon-es2.com.

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February 8, 2012 — Cree Inc. (Nasdaq:CREE) reports doubling the lumens/dollar of light emitting diodes (LEDs) with its new silicon carbide (SiC) LED substrate technology.

The Cree XLamp XT-E White LED (pictured above) reportedly delivers twice the lumens-per-dollar of other LEDs, with high performance and efficacy. This product, and Cree’s XB-D LED are based on the new SiC platform. Cree expects the cost reducing materials platform to enable widespread adoption of LED lighting.

The XT-E LED offers up to 148 lumens per watt (LPW) at 85°C (or up to 162LPW at 25°C) at 350mA, in a 3.45 x 3.45mm XP footprint (same as its XP predecessor’s footprint). Its application for ENERGY STAR qualification requires only 3000 hours of XT–E LED LM-80 data, instead of the normal 6000 hours.

Samples are available immediately and production volumes are available with standard lead times.

Cree manufactures energy-efficient, mercury-free LED lighting products, as well as semiconductor products for power and radio frequency (RF) applications. For additional product and company information, please refer to www.cree.com.

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February 8, 2012 — The global high-brightness light-emitting diode (HB-LED) market grew from $11.3 billion in 2010 to $12.5 billion in 2011, surging 9.8%, according to Strategies Unlimited. 10 companies accounted for more than 68% of the global LED supply.

Demand for LED components in the lighting market grew 44% from 2010 to 2011, from $1.2 billion to $1.8 billion.

Table. Top 10 LED suppliers for 2011, by revenue of packaged LED components.*
1 Nichia
2 Samsung LED
3 Osram Opto Semiconductors
4 LG Innotek
5 Seoul Semiconductor
6** Cree
6** Philips Lumileds
7 Sharp
8 TG
9 Everlight
*Strategies Unlimited arrived at these figures after analyzing market demand as well as the supply-side activity of more than 54 LED component suppliers.
**Companies have the same ranking when the difference in revenue is within the margin of error. Revenue includes packaged LED sales only.

Taiwanese and Chinese suppliers gained market share at the expense of the other regions in 2011. China leapt from 2% to 6% market share on the strength of its domestic market, as well as improvements in LED quality. Korean companies lost share, despite aggressively increasing capacity during the ramp-up in 2010. Japan trended down or flat, although Nichia and TG are tapping into tablet growth.

Philips Lumileds, Cree, and Osram Optoelectronics’ expansion into 6" wafers slowed, with excess capacity available on their 4" wafer lines. Osram Optoelectronics gained a major design win, which propelled its visible LED component business to more than $1 billion.

Figure. 2011 worldwide distribution of LED supply. SOURCE: Strategies Unlimited.

The revenues for the LED packaging industry are expected to be flat in the next five years. With excess capacity in the industry there is a threat of unsustainable prices.  Consolidation, vertical, and horizontal can help improve margins. To further improve profit margin, product strategies such as LED packages tested for high temperature, narrow binning, high CRI, directional /multidirectional LEDs, and embedded controls are being tried by the market.

Mobile. This segment stayed flat, at $3.4 billion. The overall decrease in the mobile phones market was offset by a sharp rise in tablet display and flash applications. A major development in this segment is the move to organic LED (OLED) displays. Approximately 50% of smartphone displays are expected to be OLEDs by 2016.

TV/monitor backlight. The LED revenue for TV and monitor backlights was $3 billion in 2011, but it is projected to drop substantially by 2016. The key disruptive factor in this segment is the introduction of low-cost direct backlit technology, targeted at sub-42-inch LCD TVs. This new technology can result in significant savings in the BOM, reducing the gap between LED and CCFL backlit TVs. These TVs are known as “Chubby TVs” since they are thicker than the slim edge-lit design the industry has been touting for the past few years.

Lighting. The same supply conditions that reduced the price of LEDs increased the demand for packaged LED in lighting applications from $1.2 billion in 2010 to $1.8 billion in 2011. System efficacy, rather than LED efficacy, was the gating factor in 2011. The LED luminaire and replacment lmap market was $9.3 billion in 2011, an increase of 45% over 2010. The market for LEDs in lighting is expected to demonstate substantial unit growth over the next five years, but revenue growth will be much lower due to pricing pressure.

Automotive. Revenue reached $1 billion in 2011 We expect a 5-year CAGR of 34% for LED headlamps. In addition to the styling issues, this is part of the trend to convert all front lighting to LEDs, as it will provide more front-end room for the car designer and reduce the overall system cost. Revenue for interior automotive lighting will show a modest decline over the next five years as instrument panel adoption reaches saturation and the market declines with prices.

Strategies in Light Conference & Exhibition 2012 is taking place this week in Santa Clara, CA. For more information, contact Strategies Unlimited at +1 650 941-3438 (voice) or e-mail at info@strategies u.com, or visit www.strategies-u.com.

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UPDATED February 8, 2012 — The Semiconductor Industry Association (SIA), representing US semiconductor manufacturing and design, shows 2011 worldwide semiconductor sales hit $299.5 billion, a 0.4% year-on-year (YOY) increase and new record. This comes despite natural disasters in major semiconductor hubs of Japan and Thailand, and an overall weak global economy, noted Brian Toohey, president, SIA.

Semico Research’s forecast for 2012 shows a 10.11% growth in semiconductors revenues over 2011. Semico believes that the bottom of the cycle is occurring now, in Q1 2012, with pent-up PC demand and other factors carrying 2012 growth starting in Q2.

Figure. Worldwide semiconductor industry revenues. SOURCE: SIA, WSTS.

Worldwide semiconductor sales in December amounted to $23.8 billion, a decrease of 5.5% from November and down 4.5% YOY, with units steadily lower coupled with a slight increase in ASP, says SIA. Excluding memory, however, semi revenues were down just 1% YOY, Barclays Capital noted.

Q4 sales of $71.5 billion represent a 7.7% decline from Q3, and a 5.3% decrease over the same period in 2010. All monthly sales numbers represent a 3-month moving average.

The Semico IPI report indicates that semiconductor sales will jump 6.3% in Q1 2012. "We continue to look for 1Q12 to mark the inflection (average guide from semi makers is -3% at midpoint), and supported by 5-8% average Q/Q CAGR for revenues in 2Q-4Q12 (6-10% ex-Memory), we model semi revenues at Flat to +4% in CY12," commented Barclays Capital. "SIA data, coupled with 1Q outlook from chipmakers, suggest…the inventory correction [is] largely resolved." Semiconductors are expected to outpace end markets in 2Q12.

"The health of the industry is a direct reflection of the pervasiveness of semiconductor innovations and their applications in almost every aspect of modern society," Toohey said. The semiconductor industry saw strong demand for optoelectronics, sensors and actuators, as well as microprocessors in 2011. The memory segment underperformed, Barclays Capital pointed out.

What to expect in 2012? Semico points to new memory technologies, MEMS oscillator emergence, and new growth in system on chips (SoC). In 2012, the semiconductor industry will "invest billions in capital expenditures and in R&D," SIA’s Toohey added. This will pay off early, and in the long term.

Also read: Semiconductor industry revenue targets $323.2B in 2012

Lamps and image sensors drove 2011 growth in the optoelectronic market to $23.1B, a 6.4% increase over 2010. Despite generally positive results and continuing development activities in the optoelectronics industry, the LED segment appeared to slow toward the end of 2011, according to Strategy Analytics GaAs and Compound Semiconductor Technologies Service (GaAs), http://www.strategyanalytics.com/. "Mid- to long-term prospects for the LED market remain positive, but continuing economic turmoil and rapidly dropping prices have manufacturers in the LED supply chain on edge," said Eric Higham, Director of the Strategy Analytics GaAs and Compound Semiconductor Technologies Service.

"The optoelectronics market appears poised for growth. Optical device and network manufacturers are targeting 40 and 100Gbps systems, a number of new LED products have been introduced and the US Department of Energy continues to make large investments in solar energy," Asif Anwar, Director, Strategy Analytics Strategic Technologies Practice added. Optoelectronic applications bring energy efficiency and low cost in a wide range of products including mobile devices and cameras.

Sensors and actuators, currently the smallest semiconductor market segment, showed the highest YOY growth at 15.5% to $8.0B in 2011, as the technologies are adopted for consumer electronics, medical devices and automotive systems. Sensors include the growing micro electro mechanical systems (MEMS) devices, increasingly used in smartphones, tablets, digital cameras, and other consumer electronic products.

MOS Microprocessors, part of the integrated circuit category, which are predominantly used in PCs and other devices that need processing capabilities, experienced 7.5% in revenue to $65.2B YOY, making it the second largest semiconductor market segment for 2011, behind logic. Strong demand in the enterprise computing segment drove microprocessor sales.

In 2012, the industry is expected to experience further recovery due to increased demand across a broad range of end market segments combined with the delayed sales impact from the supply chain disruptions in H2 2011. Additionally, several large semiconductor companies announced plans for new facilities and new R&D projects that will serve to fuel the industry’s long-term growth expectations (see Samsung, Intel reports).

The Semiconductor Industry Association represents US leadership in semiconductor manufacturing and design. Learn more at http://www.sia-online.org/.

Semico released its expanded version of the IPI report, which now contains end market forecasts from Semico’s MAP Model database, along with semiconductor bill of materials, semiconductor total available market in dollars and units, and wafer demand reports. The IPI Report will continue to publish Semico’s semiconductor forecast every quarter while the other two months in each quarter will be bolstered with articles from Semico’s analysts providing additional topical research enhancing the information provided in the IPI report. Semico is a semiconductor marketing & consulting research company, and can be reached at www.semico.com.

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February 8, 2012 — JP Sercel Associates, Inc. (JPSA), advanced laser micro machining provider, expanded its Ultrafast processing capabilities, using Pico-second lasers with innovative laser beam delivery techniques. The technology is used for high-volume production of light-emitting diodes (LED), semiconductors, solar products, and bio-medical devices.

The Pico-second laser systems operate at wavelengths ranging from UV to IR (355-1064nm) for precision machining, cutting, and hole drilling, with minimized thermal effects. JPSA Pico-second laser systems provide high peak energy intensity, resulting from the short pulse duration. JPSA’s proprietary beam delivery technologies speed the Pico-second laser machining throughputs up to 10X.

JPSA shipped its first IX-6168 Micromachining System configured with a Pico-second laser and Galvanometer to a manufacturer. The tool can cut, drill holes and vias, apply texture, ablate or pattern thin films, and machine 3D features.

JPSA supplies industrial grade UV excimer, DPSS, and Pico-second laser micromachining systems and materials processing services. Learn more at http://www.jpsalaser.com/.

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