With calendar Q1 semiconductor unit volumes well above those of the peak year of 2000, ASPs are still well below the prices of that halcyon year.

Market research company IC Insights today released an update to its annual chip forecast, the McClean Report, taking into account data for Q1 of this year. The company found that while unit volumes surpassed those of Q1 2000 by 30 percent chip prices were down 20 percent.

Taking a shorter view, ASP's fared a little better. Year over year, IC ASPs were up 5 percent in Q1. The majority of market growth year over year, however, which came in at 32 percent, was derived from surging IC unit volumes, up 26 percent over those of Q1 2003, IC Insights said.

On a sequential basis, the IC market slightly exceeded that of Q4 2003, growing by 1 percent. For the remainder of 2004, IC Insights expects Q2, Q3, and Q4 to enjoy sequential growth rates of 4, 9, and 5 percent, respectively; it's forecast of 27 percent growth for the year remains unchanged.

Of the 18 major product segments that comprise the IC market, only six displayed growth equal to or above the 32 percent year-over-year growth rate in Q1: flash, MOS PLDs, DRAM, MOS display drivers, MOS standard cell and application specific analog ICs. ROMs were the only segment that registered a year over year market decline, decreasing 11 percent. Not surprisingly, flash devices led all product segments with 70 percent year over year growth, with PLDs and DRAMs also exhibiting healthy growth rates with 65 percent and 57 percent year-over-year increases, respectively.

Returning to the longer view, only six of the 18 major IC product segments had higher sales in Q1 compared to four years earlier in the first quarter of peak year 2000. Moreover, eight IC product segments had had sales shortfalls of greater than 10 percent, including one of the largest IC market categories, DRAMs, IC Insights reported. Because of their current late lifecycle positions, the EPROM, SRAM, MOS gate array, digital bipolar, and ROM market segments will never again reach their 2000 market highs, IC Insights concluded.

Bill McClean, IC Insights president, has argued for sometime that the industry may be approaching a saturation point of silicon in electronic systems, and that the pervasiveness of electronics is a sign of industry maturation, and that compound annual growth rates (CAGR) are gradually slowing. IC Insights reiterated that stance in its May update.

If plotted in 10-year increments between 1973 and 2003, the CAGR of the chip maket would depict a shallow downward slope. IC Insights believes that the movement from a 13 percent CAGR from 1973 to 1983, to 11 percent from 1983 to 1993, and to 9 percent from 1993 to 2003 illustrates the maturing of the IC industry. The market research firm forecasts this trend to continue over the next ten years with an 8 percent IC unit volume shipment CAGR forecast to occur during the 2003 to 2013 time frame.

By: DocMemory
Copyright © 2023 CST, Inc. All Rights Reserved