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A new econometric semiconductor industry forecast predicts semiconductor wafer area production to grow slightly less than 6% in 2013, according to Linx Consulting.

Using a macroeconomic forecasting tool that incorporates measures of economic uncertainty, global economic shocks, and regional volatility, the forecasting service, called The Econometric Semiconductor Forecast, predicts a slow first quarter in 2013 will be followed by a strong second quarter with moderate growth in the second half of the year. This modest growth forecast is believed to be demand-driven, since inventory levels have not shown a significant increase in 2012.

The Econometric Semiconductor Forecast is the first to use global GDP macroeconomic models to provide semiconductor industry forecasts at a quarterly frequency with monthly updates, allowing forecast recipients to plan for short-term fluctuations in the volatile semiconductor industry.

“An unstable global economy leads to wide variations in economic forecasts, making it difficult to develop meaningful demand-side forecasts,” said Mark Thirsk, managing partner of Linx Consulting. “Our econometric forecast model allows us to develop more accurate forecasts on a monthly and quarterly basis, which are vital for operations planning and business forecasting in the semiconductor supply chain.”

Based on a demand-driven equation that captures >98% of the long run variation in semiconductors, the economic forecast model used by Linx Consulting includes global real GDP growth from consensus forecasts, US consumer and business spending on technology goods, inventory-shipments ratio, computer and electronics, and financial crisis shock indicator to capture panic behavior in the latest cycle.

Headwinds in the Global Economy

Uncertainty surrounding government policies and ongoing fallout from the financial crisis combine to restrain growth in 2013. Protracted periods of uncertainty followed financial crises in the past, accompanied by prolonged subdued growth rates as major economic policies changed and debt restructuring dampened investment and spending.  Few of today’s policymakers or business leaders have experience dealing with this type of an environment. That lack of experience adds to the uncertainty in the current outlook, as it tends to increase cautious economic behavior by consumers and businesses. In 2013, policies should become a bit more settled in the first half of the year, improving confidence somewhat.  Global economic growth is unlikely to recover to its longer-term potential until after 2013 as fundamental structural imbalances will improve slowly at best.

In the face of these headwinds, the more than 250 forecasters surveyed in the December 2012 Consensus Forecasts produced a consensus subdued, below-trend global growth of 2.6% in 2013.  This is a slight improvement over the 2.5% now expected for 2012, but less than the 3.1% achieved in 2011 and below the long-term potential real global growth rate of around 3.5%.  While the consensus averages to 2.6% for 2013, there is a relatively wide range in individual forecasts, reflecting the uncertainty in the outlook.  Individual outlooks depend most on how forecasters see developments in the US and Eurozone.

Read more from The Econometric Semiconductor Forecast: Regional developments to affect growth of semiconductor industry

The forecasting service will provide subscribers with monthly updates of quarterly forecasts of total semiconductor production in Million Square Inches of silicon processed, as well as segmentation by device, including DRAM, flash, MPU, ASIC, analog and discrete.

 

Spending on research and development by semiconductor companies grew 7% in 2012 to a record-high $53.0 billion, even though the semiconductor market declined 1% to $317.6 billion, according to the 2013 edition of IC Insights’ McClean Report.  The increase lifted R&D spending by chip companies to 16.7% of total semiconductor sales in 2012, the highest level since the peak of 17.5% was reached in both 2008 and 2009.

For more than three decades, R&D spending as a percentage of total semiconductor sales has trended higher due to increasing costs associated with developing complex IC designs and creating next-generation process technologies to manufacture these circuits.  In the late 1970s and early 1980s, R&D spending as a percent of semiconductor sales by chip companies was typically 7-8%.  R&D-to-sales ratios grew to 10-12% of revenues by the early 1990s and then jumped to over 15% during the last decade, reaching a record 17.5% in 2008.

However, as shown in Figure 1, not all companies have seen a growing portion of sales consumed by R&D.  For example, Samsung’s R&D-to-sales ratio fell from a peak of 25% in 2001 to 8% in 2010 and has remained there since.  

Samsung’s semiconductor business is more capital-intensive than it is R&D-intensive because of the commodity nature of the DRAM and flash memory businesses in which it mainly participates.  As a result, since 2001, Samsung’s semiconductor sales have grown an average of 16% per year, while its R&D spending has increased at about one-third the rate (5%) and it’s capital expenditures have grown by an average of 19% annually.  The main focus of Samsung’s investments is in adding new fab capacity for large-diameter wafers (currently 300mm but heading toward 450mm later this decade).

Intel’s business is also capital-intensive.  Its spending on new fabs and equipment in each of the past two years was about $11 billion, which was only about $1 billion shy of what Samsung spent in each of those years.  Intel’s advanced microprocessors and other incredibly complex logic devices have very short life cycles.  Spending large amounts of money on research and development is part of its business model.  Intel’s $10.1 billion in semiconductor R&D spending in 2012 was more than 7x the amount spent by second-place Qualcomm!  In fact, Intel spent more than one-third of the combined $28.7B spent by the top-10 R&D spenders in 2012, according to the 2013 McClean Report.

Figure 1 also shows how much the industry’s largest pure-play foundry, TSMC, has been spending on R&D as a percent of sales over the past decade-and-a-half.  As the process technology needed for each new generation of ICs has become increasingly difficult to develop, fabless companies and the growing number of fab-lite companies have come to rely on TSMC not only for fabricating their wafers, but also for helping to bring their IC designs into existence.  As a result, TSMC’s R&D spending-to-sales ratio has been gradually climbing over the past 6-8 years.  TSMC’s spending ratio reached 8% in 2001, but that had a lot to do with the fact that its sales were hit hard by the industry recession that year.  Aside from a small dip in 2009, TSMC’s spending on R&D has grown every year since 1998 and at an average annual rate of 25%!  Over that same 1998-2012 timeperiod TSMC’s sales grew an average rate of 19% per year.

Facing a relentless onslaught from tablets, smartphones and solid state drives (SSD), global hard disk drive (HDD) market revenue in 2013 will decline by about 12 percent this year, according to an IHS iSuppli Storage Space market brief from information and analytics provider IHS (NYSE: IHS).

Revenue is set to drop to an estimated $32.7 billion in 2013, down 11.8 percent from $37.1 billion last year. HDD revenue will be flat the following year, amounting to $32.0 billion in 2014, as shown in the figure.

“The HDD industry will face myriad challenges in 2013,” said Fang Zhang, analyst for storage systems at IHS. “Shipments for desktop PCs will slip this year, while notebook sales are under pressure as consumers continue to favor smartphones and tablets. The declining price of SSDs also will allow them to take away some share from conventional HDDs.”

HDD gross and operating margins likewise will decline as a result of continued price erosion. “However, HDDs will continue to be the dominant form of storage this year, especially as demand for Ultrabooks picks up and hard drives remain essential in business computing,” Zhang added.

HDD vs. SSD

HDDs overall will maintain market dominance because of their cost advantage over SSDs, particularly when higher densities are involved and dollars per gigabyte are calculated. HDD costs and pricing are significantly lower than SSDs, with already falling HDD average selling prices expected to decline further this year by 7 percent.

Moreover, HDDs will continue to be part of storage solutions even in Ultrabooks that make use of an SSD component. The solution, which cobbles hard disk drives together with a so-called cache SSD module, boasts of a superior price-value proposition compared to SSD-only counterparts.

A major growth area for HDDs will be the use of hard disk drives in the business sector spanning the enterprise space, cloud storage, big data and big-data analytics. Bearing the lowest cost of any storage medium now on the market, HDDs will remain the final destination for the majority of digital content that need to be filed away. And toward the last quarter of this year, Western Digital is expected to launch a 5-terabyte Helium HDD, catering mostly to data centers for enterprise servers and storage applications, further propelling the HDD space into overdrive.

Western Digital vs. Seagate

Western Digital is expected to continue battling archrival Seagate Technology for market leadership in both revenue and shipments, especially in the enterprise business segment. While Seagate had a 50 percent share of the enterprise market last year, the introduction by Western Digital of its new helium technology could catapult the manufacturer to the top at the end of 2013, dethroning Seagate in the process.

Optical drives vs. extinction

In the parallel market for PC optical disk drives—home to discs like CDs and DVDs—losses in both revenue and shipments are similarly expected. The declines stem from a number of reasons, including smaller chassis sizes for PCs, a shift in preference among consumers toward video streaming instead of using physical discs, and cost cutting from PC manufacturers that have lost interest in using optical drives.

In what appears to be a grim scenario, the optical disk drive industry is expected to encounter continued challenges this year, such as those presented by thinner PC designs. Optical drives could eventually be abandoned by PC makers altogether.

Scientists at RTI International are advancing the state of science in electronic devices for optical systems by using superlattice structures to optimize the performance of germanium optical detectors on silicon chips.

Their research, highlighted in the December issue of Nature Photonics, explains their use of thin films to overcome inefficiencies in crystal-structure mismatch between silicon and germanium. This structural mismatch results in an efficiency loss in electronics and is a major challenge in fabrication processes and widespread implementation. 

Solutions to date have mostly focused on engineering the buffer layers between silicon and germanium to accommodate this mismatch, but have yielded insufficient device performance levels. The RTI research team has incorporated a silicon-germanium superlattice structure appropriately to control the electric field in the active region of the optical detector and improve the device performance levels. 

The scientists’ goal is to demonstrate the integration of germanium photonic devices that use light to process information and then interact with silicon electronic circuits that use electrons to process information. Doing so will pave the way for next generation silicon-based optoelectronics for communication, computation and data transfer.

The scientists, Gary Bulman, Ph.D., and Jayesh Bharathan, of RTI’s Center for Solid State Energetics (CSSE), also published this research in the Journal of Electronic Materials. Bharathan is presently pursuing a doctoral degree in materials science and engineering at NC State.  

“This research shows that high-performance germanium photo-detectors can be fabricated on commonly available silicon wafers, using superlattice structures to carefully optimize the devices," said Rama Venkatasubramanian, Ph.D., director of RTI’s CSSE. “This device technology will become important for next-generation communication and computational devices and also appears attractive from a commercial manufacturing standpoint.”

C. Grant Willson, professor of chemistry and chemical engineering at The University of Texas at Austin, has won the Japan Prize, an international award similar to the Nobel Prize. He’s sharing the 50 million yen (approximately $560,000 in U.S. dollars) prize with his colleague and friend Jean M.J. Fréchet, who is now vice president for research and professor of chemical science at King Abdullah University in Saudi Arabia. The winners were announced today in a ceremony in Tokyo. The Japan Prize Presentation Ceremony and Banquet, with the emperor of Japan in attendance, will take place in Tokyo on Wednesday, April 24, 2013.

Willson (left) and Fréchet (right) first conceived of “chemically amplifed resists,” the materials for which they are being recognized, in 1979. Willson was a researcher at IBM Corp., and Fréchet was spending a year with the company while on sabbatical from the University of Ottawa.

“My boss came to me and said there is a crazy Frenchman who wants to come and spend a year here. Will you be his host?” said Willson, professor of chemistry and biochemistry in the College of Natural Sciences and the Rashid Engineering Regents Chair in the Cockrell School of Engineering. “I said, ‘Let me do a bit of research on the guy,’ I looked at his papers and they were excellent. He was really doing good science, so I said, ‘Sure.’ He came to join me, and we started by having a great discussion about photoresists.”

At the time Willson and Fréchet began talking, IBM was the world leader in manufacturing chips. Every two years or so, in keeping with “Moore’s Law,” the company had been able to write smaller patterns on the silicon and thus double the number of devices on each chip. The company was nearing a point, however, when continuing that pace of development did not look possible.    

“We were stuck,” said Willson. “Further shrinking of the devices demanded printing with shorter wavelength ultraviolet light. The light bulbs that were available did not produce much light at the shorter wavelength, and the photoresists then being used took hours to develop in response to the low light. It wasn’t practical in terms of production. So we needed to develop new equipment or find photoresist materials that were orders of magnitude more sensitive.”

Willson and Fréchet proposed using a catalyst to amplify the sensitivity of the photoresist. Instead of being dependent on one or multiple photons of light to trigger a chemical change in one molecule of the resist, with catalysts one photon could in theory set off a reaction that would “chew up” many of its neighbors as well. Thus light from the dimmer short wavelength light bulbs would be sufficient.

“It shouldn’t have worked,” said Willson. “It should have been too blunt an instrument to draw fine lines. If you put a cow in a pasture, it will not stay put. It will wander around and keep eating until it eats up the whole field. Our catalysts should have eaten the whole field, but they didn’t. For all practical purposes, they stayed put. We got very high sensitivity and very high resolution. It wasn’t until much later, actually, after the thesis work of two University of Texas graduate students, that we finally figured out why the reaction is controlled in the way it is. At that time of the invention, though, we just needed to know that it worked reproducibly."

Fréchet, who left IBM at the end of the year, kept collaborating from afar. He and Willson were soon joined by Hiroshi Ito, whom Willson recruited from the State University of New York-Syracuse. Over the next few years the trio developed the process to the point where IBM was willing to put it into production.

“I still remember standing in the clean room at IBM’s facilty in Burlington, Vermont, and watching huge numbers of parts being manufactured with our new material,” said Willson. “It was a thrill that is difficult to describe.”

The chemically amplified resists and their descendants helped IBM maintain its edge in chip production for many years. The patents were licensed in the early 1990s, and many adaptations of the resist were developed. These commercially available materials are now used throughout the industry to enable technologies as diverse as mobile phones, personal computers, home appliances, automobiles and medical equipment.

“The materials have gotten much more sophisticated,” said Willson. “But the fundamental design concept is the same. We made the first cookie, and since then others have made almond cookies and chocolate chip cookies and cookies with a bit of coconut in them that taste better. Hiroshi, who died in 2010, continued to work on chemically amplified resists his entire life and made many important contributions to the modern formulations. If he were alive, he would have shared this prize with us.”

If potential next-generation methods such as extreme ultraviolet (EUV) lithography prove viable, the resists will live on with them. Ironically, Willson himself has placed his bets elsewhere, on a process called nanoimprint lithography that he and S.V. Sreenivasan, a colleague at the Cockrell School, have been developing and commercializing.

“I think that this whole idea of using lasers and lens and resists has reached its limit,” he said. “It’s been amazing, though, to have played the small part in it that we have.”

Willson and Sreenivasan were honored in 2012 as “Inventors of the Year” by the university’s Office of Technology Commercialization for their nanoimprint lithography technology. Willson was also awarded the National Medal of Technology and Innovation in 2007 for his development of chemically amplified resists and advanced patterning technology

The Japan Prize is administered by the Science and Technology Foundation of Japan and honors scientists from around the world who have made original and outstanding achievements in science and technology. This year’s other prize is being awarded to Rutgers University professor John Frederick Grassle for his contribution to “marine environmental conservation through research on ecology and biodiversity of deep-sea organisms.”

Chip inventory held by semiconductor suppliers reached alarmingly high levels in the third quarter of 2012 amid weak market conditions, according to an IHS iSuppli Semiconductor Inventory Insider Market Brief from information and analytics provider IHS (NYSE: IHS).

Overall semiconductor revenue declined by 0.7 percent sequentially during the fourth quarter last year. The poor results came after inventory reached exceedingly high levels by the end of the third quarter in 2012, amounting to 49.3 percent of total semiconductor revenue—more elevated than at any point since the first quarter of 2006.

Chip stockpiles among semiconductor suppliers had actually gone down during the final two quarters of 2011, showing a promising drawdown, as depicted in the figure attached. But then inventories steadily ticked up again after that, reaching 47.5 percent of total revenue in the second quarter before hitting the current peak in the third—the latest time for which full figures are available.

The inventory level being measured refers to chip stockpiles specifically in the hands of semiconductor suppliers, not to inventory throughout the electronics supply chain. Chip level at the supplier level is then compared against combined revenue from a sample of 75 semiconductor supplier companies excluding memory, which is tracked separately because of that market’s typical late results. A low inventory-to-revenue ratio is preferable, given that higher levels indicate not only unsold stockpiles but also unrealized revenue tied up with the stagnant inventory.

 “The uncomfortably high level of inventory among semiconductor manufacturers of nearly all stripes is a result of key demand drivers failing to materialize,” said Sharon Stiefel, analyst for semiconductor market intelligence at IHS. “Demand for semiconductor devices has typically come from new products that consumers feel compelled to purchase. But going into the holiday season last year, no such new products marshaled enough impetus to overcome consumer fears about lingering economic woes. Two months prior to Christmas, consumer purchases of electronics had grown by only 0.7 percent, the worst performance since 2008.”

Also contributing to depressed conditions was the poor performance of the industry’s data processing segment, traditionally the largest user of semiconductors. In fact, mobile PCs were projected to decline in 2012 when final figures are tallied, toppled from dominance by media tablets. Ultrabooks and other ultrathin PCs, meanwhile, did not produce the demand for semiconductors originally expected as the year progressed.

Despite the collective rise in inventory stockpiles, some semiconductor segments performed better than others. For instance, with feature-rich smartphones and tablets taking the place of traditional PCs among consumers and eroding PC market share, the devices were anticipated to provide the strongest demand in the final quarter of 2012. As a result, semiconductor revenue for the wireless segment was expected to climb almost 4 percent. Semiconductor sectors benefiting from the tremendous growth of handsets and tablets included logic, analog and NAND flash memory, with those semiconductor channels refilling following strong shipments even into the beginning of this year.

The first quarter of 2013 likely will see growth in the industrial and automotive electronics segments. Other semiconductor markets, for their part, will overcome the seasonal decline normally expected at this time of year and then start to rebound around the second and third quarters. Such assumptions, however, rest on the even larger factor of the global economy, currently a volatile variable itself with no set outcome. If global economic forecasts perform according to positive expectations, semiconductor revenue could grow by 4 percent in the second quarter and by a very solid 9 percent in the third. However, if demand evaporates, semiconductor suppliers will find themselves in a deplorable oversupply situation, which would then lead to inventory write-downs throughout the year.

By Tom Morrow, chief marketing officer, SEMI

Spending on LED fab manufacturing equipment will decline 9.2% in 2013 as the industry faces weak long-term demand and consolidates manufacturing capacity. According to the SEMI LED/Opto Fab Forecast, spending on LED fab manufacturing equipment will drop to $1.68 billion in 2013, down from $1.85 billion in 2012. Global LED manufacturing capacity will continue to grow this year, reaching an estimated 2.57 million 4-in. wafer equivalents, a 24% increase over 2012. The outlook for equipment spending in 2014 is currently projected at less than $1 billion, as manufacturers assess an uncertain competitive environment and potential alternative manufacturing strategies.

Underlying the softening in manufacturing investment is weak long-term demand for package LED components. Despite growing demand for solid state lighting systems, total demand for packaged LEDs is at or nearing its peak. Last year, Strategies Unlimited forecasted that demand for LEDs would peak in 2012 or 2013 at approximately $13.3 billion, declining to less than $13.0 billion in 2014. Recently, IMS Research forecasted that LED demand would peak in 2015 at nearly $14 billion before declining through the remainder of the decade.

World LED capacity trend. (Source: SEMI Opto/LED Fab Forecast, Nov. 2012)

Among the reasons for weak long-term demand is the LED count per device is dropping fast and the long-life of LED-based lighting systems radically reduces the replacement lamp market. For LED manufacturers, average selling prices continue to drop, especially in high-growth mid- and low-power segments serving the lighting industry.

With excess manufacturing capacity continuing to place price pressures on LED components, manufacturers will be cautious in embarking on major new manufacturing investments. Low fab utilization is also delaying the transition to 6-in. sapphire wafers. In addition, new GaN on silicon products are just now reaching the market, creating further uncertainty. Last month, Toshiba announced the beginning of production of white LEDs using GaN on 8-in. silicon substrates, utilizing depreciated IC fabs with modern automation tools. Working with technology from Bridgelux, Toshiba has reportedly indicated they will eventually ramp to 10 million units per month. German-based Azzurro Semiconductors announced that Taiwan LED leader, Epistar, has successfully migrated their LED structures to its 150mm GaN-on-Si templates and the company is feverishly working on 200mm technology. Philips, OSRAM, and Samsung are all actively exploring GaN on silicon technology.

GaN on silicon could be a game-changer in the LED market, but its impact is still uncertain. Yole Developpement estimates that significant cost benefits can only occur if equivalent yields to sapphire processes can be achieved, and that production utilizes fully amortized 200mm lines. Sapphire wafer prices have significantly declined over the past 18-months, lessening the benefits of a move to silicon.

Apart from major substrate technology changes, manufacturing spending will increasingly be focused on yield rather than capacity and throughput. Equipment, materials and technology suppliers who can deliver an ROI through improved manufacturing yields can still prosper in the weakened market.

China pursues leadership

China’s 12th Five Year Plan took effect in 2011 and renewed the country’s commitment to LED and solid state lighting technologies. While the massive MOCVD spending of 2010/2011 has significantly declined, China remains the leading region in manufacturing investments. China will be the largest market for LED fab equipment in 2013 with projected spending of $667 million, approximately 40% of the total worldwide spending and almost double Japan’s spending, the second largest region. In 2011, China spent over $1.2 billion on LED fab manufacturing equipment.

China’s generous national and local subsidy programs behind the massive industry development (China now has 82 LED fabs, up from only 16 in 2006) have all but disappeared, but the country remains committed to developing all sectors of the LED industry. China is a major consumer of LEDs in signage, mobile displays, TVs, and lighting that utilize low and mid-power LEDs that Chinese suppliers specialize in. Energy conservation through solid state lighting is a national priority. Most observers predict a consolidation of the China LED industry, with perhaps one of two companies emerging as global powerhouses. While much of China’s LED capacity is dormant, in transition or reliant on older technology, companies such as SanAn and ETi will invest new and upgraded manufacturing technology over the next two years.

Industry structure implications

Another troublesome aspect of the LED industry is that nearly 70% of the LED market is supplied by only ten companies, most of whom are directly involved in manufacturing lighting systems. Increasingly, the LED components may be seen as loss leaders offering little incentive for manufacturing investments. With falling ASP’s, soft demand, vertically integrated customers, and increasing supply of quality products from China and elsewhere, the outlook for continued LED manufacturing investments will be limited for the foreseeable future.

Tom Morrow will be providing the keynote address at the Strategies in Light (SIL) conference, February 12, 2013. SEMI members can receive a special discount rate with up to $200 savings to attend the Manufacturing Track. To register for SIL, click here.

The SEMI HB-LED Wafer Task Force, Equipment Automation Task Force, and Impurities & Defects Task Force will be meeting in conjunction with the Strategies in Light conference in Santa Clara, CA (Feb. 12-14). Following Strategies in Light, the NA HB-LED committee and its task forces will meet in April 1-4 in conjunction with the NA Standards Spring 2013 meetings in San Jose, California. For more information and to register for these meetings, please visit the SEMI Standards website here: www.semi.org/en/Standards.

For more information on SEMI’s involvement in the LED market, visit www.semi.org/LED.

January 15, 2013 – The semiconductor industry is undergoing massive transformation as the rise in mobile computing, changes to the fabless-foundry model, uncertainties in technical innovation, and global macroeconomic trends become the dominant forces in 2013 and beyond, according to industry leaders speaking at the SEMI Industry Strategy Symposium (ISS), opening this week in Half Moon Bay, CA.

Ajit Manocha, CEO of GlobalFoundries, during his keynote presentation discussed the dynamic technology and economic needs of mobile computing that is driving new approaches to the chip design-to-production cycle. Calling it "Foundry 2.0," he sees outsourced semiconductor manufacturing moving toward a more IDM-like model, creating new collaboration models and techniques to close the gap between process teams at foundries and design teams at the fabless companies. With daunting technical challenges like 3D stacking, 450mm fabs, new transistor architectures, multi-patterning, and the uncertainties to lithography-based scaling, product development paths with virtual teams will evolve and adapt rapidly in the coming months and years.

With new fabs now costing upwards of $8 billion and leading-edge manufacturing investments expected to exceed $40 billion this year alone, global economic trends and forces — increasingly influenced by uncertain consumer spending in both developed and emerging markets — have never been more important to the semiconductor ecosystem. Dr. John Williams, president and CEO of the Federal Reserve Bank of San Francisco, said "Many businesses are locked into a paralyzing state of anxiety."

Williams used the ISS conference to lessen uncertainty and anxiety in the capital markets, pledging to keep interest rates near zero until the unemployment rate drops to 6.5%, as long as inflation expectations do not climb above 2.5%.

Bruce Kasman, chief economist and managing director of global research at JP Morgan, shared a positive economic outlook, especially in the second half of the year, that is "bumpy, better and less risky." He sees Asia leading the economic rebound, as China demand accelerates with the change in leadership and improved access to credit. University of Texas Austin Churchill scholar, Matthew Gertken, however, discussed the simmering "Asian cold war" developing as territorial disputes with China generate an emerging "containment policy" by many of China’s neighbors.

How these macroeconomic dynamics are impacting the semiconductor industry was discussed by speakers who saw both perils and opportunities. Andy Oberst, senior VP, strategy and corporate development at Qualcomm, looked at what mobile phones would likely look like in 2020, but also pointed out how disruptive changes — not incremental changes — have always driven the mobile phone market.

Satya Kumar, vice president at Credit Suisse, discussed how original equipment makers like phone and computer manufacturers have always benefitted from the declining cost of transistors and pondered, "Could stopping Moore’s Law be a good thing?"

As the world’s largest semiconductor company, Intel’s view is different. Michael Bell, vice president and general manager, mobile and communications group at Intel, brought the audience up to date on the company’s mobile strategy, offering confidence that Intel’s portfolio of RF baseband technologies, leading-edge scaling performance, and supply chain excellence will ultimately deliver significant success.

Conference speakers on Day 2 and Day 3 of ISS will discuss how these and other mega-trends are specifically impact the R&D, product development, manufacturing, investment, and supply-chain challenges impacting various sectors of IC and microelectronics industry.

The SEMI Industry Strategy Symposium (ISS) examines global economic, technology, market, business and geo-political developments influencing the semiconductor processing industry along with their implications for your strategic business decisions. For more than 35 years, ISS has been the bellwether semiconductor conference for senior executives to acquire the latest trend data, technology highlights and industry perspective to support business decisions, customer strategies and the pursuit of greater profitability.

January 7, 2012 – As the annual Consumer Electronics Show and hordes of techie enthusiasts descends over Las Vegas this week, one display technology — 4K × 2K — is expected to grab most of the attention, says NPD DisplaySearch.

4K LCD TV shipments will exceed OLED TV shipments through 2015, the firm says, due to both delays by OLED TV makers and increased promotion of 4K LCD TVs. Many Chinese brands are currently launching their own products domestically. OLED TVs should start hitting the market in 2013, but with low volumes and high prices. Note that 4K technology can be applied to OLED TVs as well, and eventually will be introduced for some premium TV segments, the firm points out.

"The global TV market—and North America in particular—are experiencing either slow or negative growth in 2012, and brands are eager to demonstrate new technologies that might create a spike in demand," stated Paul Gagnon, Director for Global TV Research at NPD DisplaySearch. Gagnon added, “OLED TV was prominently featured during the previous two CES shows as the next-generation TV display technology, but the lack of market launch so far has caused several set makers to start emphasizing 4K×2K resolution TVs for premium market segments."

Forecast for OLED TV and 4K LCD TV. (Source: NPD DisplaySearch)

Overall TV demand is expected to fall in 2012, as consumers worldwide grapple with tough economic conditions and TV prices fall at only marginal rates. DisplaySearch estimates LCD TV shipments in 2012 were 205 million, slightly lower than in 2011, while plasma TV shipments sunk 24% to 13 million. The firm sees 2013 initially taking shape as a flat market due to persistent economic uncertainty, but ultimately smoothing into gradual growth as conditions improve and as price declines in the TV market accelerate.


TV shipment growth by technology. (Source: NPD DisplaySearch)

January 3, 2012 – Active matrix OLED (AMOLED) displays will continue to encroach upon LCD technology through small and medium-sized (9-in. and smaller) displays used in mobile phones, according to recent analysis by NPD DisplaySearch.

Total OLED display shipments are expected to reach 191 million in 2012, accounting for 8.4% of total small/medium displays. AMOLEDs will make up 6% all by themselves, having driven total OLED penetration into this market segment since 2010 and the launch of Samsung’s Galaxy S phone, according to Yoonsung Chung, director, large-area displays & FPD materials for NPD DisplaySearch. Mobile phones continue to drive the OLED adoption, with mobile phone applications expected to make up 69% of the small/medium OLED market in 2012 and growing to 83% in 2015.

OLED penetration in small and medium display shipments by technology. (Source: NPD DisplaySearch)

Mass adoption of AMOLED technology, though, faces hurdles due to the higher cost and technical difficulty of manufacturing — successful entry takes five years on average, according to the firm. "Prior to the start of mass production of AMOLED displays for mobile phones, only passive-matrix OLED (PMOLED) displays were available, mostly used in applications such as mobile phone sub-displays, automobile displays, and some industrial and niche applications," Chung stated.

Samsung produces nearly all AMOLED displays today, but more players will be needed to continue to push the technology’s adoption — and indeed new panel makers will emerge in 2013 from Taiwan and China, Chung forecasts. He also predicts demand for "OLED applications for smartphones, amusement devices, digital still cameras, and home appliances."

Small/medium OLED display shipments by application. (Source: NPD DisplaySearch)