Global System-On-a-Chip Market to Reach US$48.8 Billion by 2017

Thursday, April 12th, 2012

Global System-On-a-Chip (SoC) Market to Reach US$48.8 Billion by 2017, According to New Report by Global Industry Analysts, Inc.

SAN JOSE, California — Global Industry Analysts, Inc. (GIA) announces the release of a comprehensive global report on System-On-a-Chip (SoC) market. Global market for System-On-a-Chip (SoC) is projected to reach US$48.8 billion by the year 2017. Growth will be driven by encouraging developments in the field of multiple systems on a chip and increasing Internet-centric applications of SOC, such as in networking and data storage systems.

As building blocks of digital electronics, SoCs represent a new breed of complex, highly integrated ICs. With the semiconductor industry becoming Internet-centric in a world that is increasingly becoming networked and data centric, demand for SOCs in data storage is poised to witness the maximum gains in the upcoming years. NAS SoC is especially seen as likely to emerge into the greatest beneficiary of the growing demand for networked storage solutions. Increase in the number of home and small business networks, continued data explosion, and the growing need for data backup and archiving, are forces that make data storage an indispensable IT need. As companies seek to overcome data storage performance limits in this world of information overload, the opportunities for storage technologies like NAS devices is expected to trickle down to NAS SoC and other integrated storage SoCs for use in consumer storage applications. In contrast to the PC-centric SoC of the yesteryears, growth in the future will be driven by expansion of applications of system-on-a-chip (SoC) in lucrative end-use markets such as mobile Internet devices, storage, communications, and industrial robotics.

Increased penetration of broadband connectivity into households has fuelled the demand for SoCs in consumer electronic devices such as set-top boxes, digital TVs, digital audio players, and a host of other products. Use of SoCs in the game terminals and other related products are expected to fuel the market growth further for SoCs in this segment. As trends in the global electronics industry skew towards ICs that are compact, scalable, and flexible enough to allow design changes with minimal investments, SoCs have and will continue to benefit. Innovations in subcomponents of SoCs, such as, MPEG decoders, PCI bus interfaces, double-data-rate memory controllers, specialized filter blocks, bodes well for the market, as these innovations significantly enhance application-related logic in SoCs thus expanding its use in advanced SoC embedded products. Also, rise in use of SoCs in wireless communication devices, such as, wireless phones, pagers, cordless phones and broadband networks will continue to push demand for communication SoCs in the market.

The advent of Three-Dimensional (3-D) chips is also expected to considerably boost the market for System-on-a-Chip (SoC) solutions. The new chips are also called as “second generation” SoCs and enable 3-D integration of logic devices with various components such as memory, silicon with III-V devices, logic with analog, image sensors with logic, as well as RF filters with other RF components. This leads to creation of new integrated circuits for System-on-a-Chip (SoC) solutions leading to faster processing speeds. A major advantage of 3-D chip is its ability to combine low-voltage digital signal with higher-voltage analog, which is otherwise very difficult for ordinary SoCs. 3-D SoCs are increasingly used in wireless communication applications. The development of these advanced chips will open up new avenues for further IC level system integrations.

Along with the development of System-on-a-Chip (SoC) solutions, the SoC makers are also focusing on the development of complementary embedded software. As the SoC market matures and hardware becomes standardized and highly commoditized, basic differentiation will arise from embedded software development. Therefore, over the coming years for SoC makers, prudence lies in developing embedded software for them to stay in business and remain competitive. Consequently, companies are expected to invest more on developing embedded software and partner with software providers for enriching their software portfolio. The development of embedded software is leading to the formation of “second-generation” SoCs that are single-chip multifunctional products with multiple processors. These SoCs effectively integrate both hardware and software into a single chip.

The semiconductor industry in Europe currently remains nervous over the playout of the debt crisis. While nothing remains certain and the potential outcomes of the crisis remain numerous, Europe remains a wildcard with perceptions about the possible effects of the crisis varying widely among sections of the industry. At the pessimistic end of the spectrum, bearish outlook indicates that declines in industrial and consumer confidence, the two key pillars of growth, in debt burdened economies can take its toll on overall spending on electronics thus indirectly impacting demand for microcontroller ICs, sensors and discrete semiconductor products. Currently, however, despite all the economic risks carried by the debt crisis, immediate term outlook remains positive, mirroring the guarded optimism prevailing over the financial bailout strategies designed to restore market confidence. With scaling down of IC sizes expected to continue, SOCs are expected to stand up to the pressure as new opportunities will be created for nanoscale system-on-chip (SoC) capable of providing higher performance and lower energy consumption. Also given Europe’s already declining share in consumption of semiconductor products in the world market, the Euro crisis is not expected to impact global growth patterns.

As stated by the new market research report on System-on-Chip (SoC), United States represents the largest market worldwide followed by Asia-Pacific. Asia-Pacific is expected to witness the strongest growth of 14.8% over the analysis period 2009 through 2017.

Major players in the marketplace include Microsemi SoC Products Group, Altera Corporation, ARM Holdings Plc, Broadcom Corporation, Freescale Semiconductor Inc., GCT Semiconductor Inc., Infineon Technologies AG, Intel Corporation, LSI Corporation, Marvell Technology Group Ltd., Panasonic Corporation, Mentor Graphics Corporation, Renesas Electronics Corporation, NVIDIA Corporation, Samsung Electronics Co. Ltd., STMicroelectronics N.V., Synopsys Inc., Taiwan Semiconductor Manufacturing Co. Ltd., Texas Instruments Inc, Toshiba America Electronics Components Inc, Xilinx Inc., Zilog Inc., ON Semiconductors Corporation, Ziptronix Inc., among others.

The research report titled “System-On-a-Chip” (SOC): A Global Strategic Business Report” announced by Global Industry Analysts, Inc., provides a comprehensive review of market trends, issues, drivers, company profiles, mergers, acquisitions and other strategic industry activities. The report provides market estimates and projections in value sales for major geographic markets including the United States, Canada, Japan, Europe, Asia-Pacific, and Rest of World. Key product segments analyzed include SoCs Based on Standard Cell and SoCs Based on Embedded IP. End-Use markets analyzed include Computers, Communication Equipment, Consumer Electronic Devices and Automotive Applications, among others.