Demand remains strong but some prices will slip
Article Abstract:
The Semiconductor Industry Association (SIA) forecasts 26% worldwide growth for 1996. Industry observers say demand is expected to continue to be greater than supply, and new applications will continue to require more microprocessors. SIA predicts 33% growth in the Asia-Pacific region, 30% growth in the Americas, 27% growth in Europe and 18% growth in Japan. Some industry participants note that even if the PC market growth slows, present PC owners will still need add-on memory chips. Furthermore, the emergence of digital cellular phones, personal digital assistants, digital set-top boxes and other consumer systems will continue to add demand for many types of circuits. Although parity will be more prevalent in the industry, shortages will persist in many product types. Market researchers estimate that the worldwide semiconductor market will expand by 24.9% in 1996, down from the 44% growth rate in 1995. The decrease is primarily due to a flood of new wafer capacity anticipated to arrive in the market in early 1996, which will depress memory prices.
Publication Name: Electronic Business Today
Subject: Electronics and electrical industries
ISSN: 1085-8288
Year: 1996
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Runaway chip demand warps forecast models
Article Abstract:
Forecasts for 1995 semiconductor industry growth were as much as 30% low, raising questions about the ability of chip vendors and market analysts to make accurate projections of demand. The Semiconductor Industry Assn's World Semiconductor Trade Statistics operation, for example, had to increase its forecast from 14.7% to 43.7%. The semiconductor market is growing quickly, driven by several factors. These include the ever increasing chip content in all types of products, greater affordability of a wide range of electronic gadgets, and such major emerging markets as China. What market forecasters could not anticipate was the almost doubling of the market in three years. Other possible factors skewing forecasts include vendor underestimation of the strength of the PC market and the industry's inclination to err conservatively. Such underestimates can hurt industry investment in growth, as the capacity is already expected to be too limited through 1998.
Publication Name: Electronic Business Today
Subject: Electronics and electrical industries
ISSN: 1085-8288
Year: 1995
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Smashing the rules in chip fabrication
Article Abstract:
Semiconductor vendors turn to hybrid solutions as the fabless versus fab dichotomy begins to deteriorate. Instead of trying to pick one option, semiconductor firms are searching out the proper balance of partnerships, fab ownership and dependence on outside foundries. Semiconductor firms that once conducted fab-only production are now outsourcing to niche foundries as a means of hedging against market turndowns. Even companies are large as Intel are getting chips from partnerships; Intel has a flash memory agreement with Japanese Sharp Corp. Fabless companies, which traditionally spend most of their money on research and development, are now being squeezed by pay penalties by foundries when they do not reach their order goals and are beginning to place more emphasis on production development. Some fabless companies are buying equity stakes in fab companies as a hedge against these penalties and market downturns.
Publication Name: Electronic Business Today
Subject: Electronics and electrical industries
ISSN: 1085-8288
Year: 1996
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