Circuits Assembly Online Magazine - SIA: Global Chip Sales Will Surpass $321 Billion in 2010

SAN JOSE, CA – Worldwide sales will surpass $321 billion in 2010 with a CAGR of 7.7% for the period between 2007 and 2010, the Semiconductor Industry Association today reported in its annual forecast of global semiconductor sales.

The forecast projects global sales of $257.1 billion in 2007, an increase of 3.8% year-over-year. Going forward, the SIA forecasts sales of $276.9 billion in 2008, a sequential increase of 7.7%; $296.2 billion in 2009, a sequential increase of 7%; and $321.5 billion in 2010, a sequential increase of 8.5%.

SIA president George Scalise noted that September sales were up 5.9% year-over-year.

The SIA said consumer demand for electronic products continues to fuel strong demand for microchips. “This year the worldwide microchip industry will produce 900 million transistors… ” said Scalise. “The increasing proliferation of semiconductors into an ever-broader range of consumer products coupled with the emergence of large new consumer markets in Asia, Eastern Europe, and South America will be the principal drivers of industry growth for the next several years.

“Consumer purchases continued to drive industry growth in 2007 despite rising energy costs and other concerns,” Scalise continued. “Unit sales of personal computers, cellphone handsets, MP3 players, and digital televisions were very robust in 2007.”

In addition, flash will increase at a CAGR of 20% between 2007 and 2010, Scalise said, while DRAM will increase 1.5%.

The SIA also noted sales of personal computers, the largest single market for microchips, are now expected to grow by 11 to 12% in 2007. Handset unit shipments are forecasted to grow by 12%. MP3 and PMP unit sales are forecasted to grow by 20%, and digital TV units by 50%.

In 2008, cellphone units are expected to grow by 8%; PC units by 11%; MP3/PMPs by 20%, and digital TVs by 18%. However, TV units could grow at higher rate as a result of the Olympics in China, said Scalise.

“All of these products … have high silicon content,” said Scalise. “Progress in semiconductor technology has been a huge boon to consumers. Today a typical PC sells for less than 30% of the price of a comparable unit in 1995, but today’s model is 100 times more powerful. We can expect to see similar cost and performance improvements in other silicon-intensive consumer products in the years ahead.”

While discussing the SIA’s forecast today, Scalise said Congress recently added $8 million to support the association’s focus center research program for university research. He also said the president has signed the America Competes Act, authorizing funding for NSF, NIST and the Department of Energy. However, he noted, Congress has not addressed the H-1B and green card caps successfully – an important issue for the industry.