Semiconductor market rebounding

17 Jun 2002

The world semiconductor market, which took a downturn in1998, is forecasted to rebound in 1999.

The World Semiconductor Trade Statistics, comprised of about60 companies representing the vast majority of semiconductorcompanies in terms of revenue, forecasts a growth of 12.6% from$125.6 billion in 1998 revenue to $141.4 billion in 1999.

Overcapacity and the Asian financial crisis last year slowedthe growth of the semiconductor market, and in 1998 the Asiancrisis caused a worldwide 8.4% decrease from the $137.2 billionmarket of 1997. But 1999 sees a growth in all regions of theworld and for all types of semiconductors except for bipolardigital, which has fallen out of favor to be replaced by CMOShardware.

In 1998 the Americas had a market of $41.4 billion, down9.5% from the 1997 figure of $45.8 billion. "A lot of America'sproducts are sold in Asia. America's exports were down," saidBill Jewell, the Americas Vice-Chairman for World SemiconductorTrade Statistics (WSTS).

The American market had grown 7.4% in 1997 over 1996, and in1999 the American market is forecasted to have a 9.6% growth over1998.

Overcapacity caused Japan's 1997 market to decline 6.1% from1996. Japan had a market of $32.1 billion in 1997; the Asiancrisis dropped the market 19.1% to $25.9 billion in 1998. Therecovery will create a forecasted 17.1% increase for 1999 to$30.3 billion.

The Asia Pacific region (which also includes Australia) rose9.6% to $30.2 billion in 1997 but then took a 4.4% downturn to$28.9 billion in 1998. The 1999 forecast calls for a 16.4%growth in that region to $33.6 billion.

Europe (which includes the Middle East and Africa) rose 5.5%to $29.1 billion in 1997 and had a 1.1% growth rate in 1998 asthe market totaled $29.4 billion. The expected 1999 increase of9.0% would bring Europe's market to $32.1 billion.

The 1999 forecast calls for a 6.7% growth in discretes over1998 from $11.9 billion to $12.7 billion, a 12.1% growth inoptoelectronics from $4.6 billion to $5.2 billion, a growth of8.4% in analog devices from $19.1 billion to $20.7 billion, anincrease of 11.4% in MOS micro from $47.3 billion to $52.8billion, growth of 13.7% from $18.6 billion to $21.1 billion inMOS logic, and a 22.4% increase in MOS memory from $23.0 billionto $28.1 billion.

The bipolar digital market declined 17.2% to $1.6 billion in1997, fell 31.0% from that to $1.1 billion in 1998, and willlikely be off 25.6% from the 1998 benchmark this year with amarket of $0.8 billion.

Optoelectronics was the one type of semiconductor which didnot experience a decline in 1998, increasing 2.5% over 1997. "It's not tied directly to things like the PC market," saidJewell, who works for Texas Instruments. "There are applicationslike the digital video disk."

The MOS memory market fell 18.6% in 1997, but that was dueto the overcapacity situation. "In the near term MOS memory isexpected to bring the strongest growth," remarked Jewell.

WSTS has data dating back to 1984. From 1984 to 1998 thesemiconductor market has grown by a compound annual average of15.5%. During the 1999-2000 period the world market is expectedto grow at a compound rate of 14.2 percent.