Strong Sensor, Actuator Market Driven By MEMS Technologies

David Lammers, News Editor -- Semiconductor International, 3/27/2008 9:28:00 AM

MEMS technology is driving new applications, making sensors and actuators the fastest growing part of the overall semiconductor industry, according to IC Insights Inc. (Scottsdale, Ariz.)

Rob Lineback, an IC Insights senior analyst, said the overall market for semiconductors — now a $237.5B industry — is expected to be strong over the five-year period ending in 2012, with an 12% compound annual growth rate (CAGR). The larger semiconductor market, which includes ICs as well as optoelectronics, sensors and actuators, and discretes (O-S-D), will hit $441.2B by 2012. Within semiconductors, ICs will grow from $217.8B in 2007 to $375B by 2012. The O-S-D portion will increase by a CAGR of 12% over the next five years to $66.2B in 2012, accounting for 15% of the total semiconductor industry, he said.

The semiconductor industry remains healthy. “Unit volumes have been going gangbusters for some time with double-digit growth rates. Now, we see ASPs firming up a little bit, which is why the five-year outlook is starting to look pretty good,” Lineback said.

This year, IC Insights has held off on any revisions to its forecast of 9% growth in the IC industry, waiting to see if the current downturn in the overall U.S. economy continues and how that is reflected in the chip industry, he said.

Outside of mainstream ICs, growth is particularly strong for sensors and actuators, power transistors and imaging devices used for security and PC applications, he said.

Actuators and sensors, driven by new user interface technologies, are the fastest-growing part of the overall semiconductor industry.

According to the market research firm’s March report on the Optoelectronics, Sensors, and Discretes (O-S-D) market, production of MEMS-based sensors and actuators will rise at a CAGR of 27% between 2007 and 2012, reaching 4.3 billion units in five years compared with 1.3 billion in 2007.

The growth in dollars is only slightly less steep. Between 2003 and 2007, worldwide sales of MEMS-based semiconductor sensors and actuators perked along at a 9% CAGR. Over the next five years, that rate will sharply increase to a CAGR of 19%, reaching $9.7B in 2012 compared with $4.1B in 2007. Overall, the sensor/actuator market is expected to reach $11.9B, counting all types of technologies. Magnetic field sensors, the largest sensor category, use thin-film deposition techniques and do not require MEMS production technologies.

Among the sensor/actuator category are pressure sensors, accelerometers, gyroscope chips, solid-state microphones, silicon MEMS oscillators, and actuators such as inkjet nozzles, micro-mirror display devices, biochips and RF filters, including surface-acoustic-wave (SAW) components.

Until recently, automotive applications have accounted for much of the MEMS market. Now, growth is being spurred by high-volume consumer applications, such as the video game controllers incorporating accelerometers and gyroscope devices to operate virtual reality games. Other user interface applications are driving growth as well. Owners of multimedia cell phones and digital music players can use “shake control” as user inputs, enabled by accelerometers that integrate special functions for recognition of sudden movements. Other motion control devices protect owners of portable systems from data loss. Sensors can detect freefall and take immediate action to protect hard-disk drives from damage.

Growth in portable systems will drive sales of power ICs over the next five years, according to IC Insights Inc.

The discrete market is set to record revenues this year, finally recovering from the collapse of the market early in the decade, Lineback said, as well as pressure on prices since then. Driven by strong growth in power transistors, which account for ~51% of the discrete category of diodes, small-signal transistors, rectifiers, thrystors and power ICs, the discrete market should grow 7% and have revenues of $18B this year, slightly exceeding the optoelectronics market, Lineback said. Power transistor revenues are expected to grown 9% this year to $9.4B from $8.6B in 2007.

New applications in battery-powered systems will help drive growth in power transistors, which are expected to account for 58% of the $23B discretes market, according to the O-S-D report.

The optoelectronics market is expected to grow by 10.4% this year to $17.6B. In 2007, problems in the camera phone business were the major reason behind a 2% decline in the optoelectronics market overall and a “rare” 7% drop in the image sensor market.

“Micron Technology and STMicroelectronics both had bad years in the image sensor market because of changes in the camera phone market. We think in the second half of this year that image sensors will start to see a recovery. Video security, automotive and cameras built into personal computers will help that market,” he said.