Strong Markets for ICs and Their Packaging

By Randall Sherman [New Venture Research]

Handheld electronic gadgets such as smart phones and tablets are driving the demand for ICs in the consumer electronics industry, as is the return in demand for automobiles which are laden with ICs. Smart phones and tablets require Internet connectivity and increasing amounts of bandwidth due to the large amount of information and images being shared. Increased demand for product functionality is driving up the IC packaging revenue faster than IC unit growth. IC packaging revenue is expected to have a compound annual growth rate (CAGR) of 9.8%, versus a CAGR of 7.3% for unit shipments through 2016. IC revenue growth is shown in Figure 1, which includes both device and packaging components.

Figure 1: IC Device and Packaging Revenue Forecast ($M) 2010-2016

The growth in handheld gadgets, which are increasingly digital in design, will boost the growth of special purpose logic (SPL) communications chips by 16.7% CAGR for device revenue through 2016, versus of 13.5% CAGR in units. The packages for these devices are varied, but FBGA and QFN package solutions are the most in demand, which pull at either end of the pricing structure. QFPs are ranked third as a package solution, but are decreasing in demand over time. These devices are expected to have a 14.8 % CAGR in revenue through 2016.

Wireless infrastructure products are also in high demand, which is helping boost consumption for standard cell and PLD chips. These devices will grow at a CAGR of 16.1% CAGR in terms of revenue through 2016, while the device units are projected at 15%. High I/O BGAs are by far the package solution of choice over the forecast period, so that the package revenue growth is projected to be slightly higher, at 16.3% CAGR through 2016. Logic chips are in demand for a host of products, therefore 32-bit MCUs are expected to have an 11.1% CAGR unit demand, although only 4.7% device revenue CAGR through 2016. QFPs and BGAs have the highest demand of the package solutions, although the QFP is waning in favor of the BGA. Thus, the package revenue is growing at a CAGR of 12.8% through 2016 for 32-bit MCUs. This information is included in the newly released report "The Worldwide IC Packaging Market, 2012 Edition", from New Venture Research. Highlights of this report include:

Worldwide IC Packaging Market Forecasts, 2010-2016

• Units
• Package Price
• Packaging Revenue
• By Semiconductor Product
• By Package Family
• By I/O Range

Contract IC Packaging Market Forecasts, 2010-2016

• Units
• Package Prices
• Packaging Revenue
• Competitive Rankings
• Company Profiles