GaAs IC market "to reach $3.9 billion in 2004"
The GaAs IC market grew by almost 33% in 2003 to reach $2.86 billion.
That's the conclusion of a report from US-based analyst company The Information Network (TIN), based in New Tripoli, PA.
The report adds that growth this year will be even faster, with the total market predicted to reach $3.9 billion.
Although the weakened US dollar has undoubtedly contributed to this increase, TIN president Robert Castellano estimates this effect to have accounted for only around 10% of the growth.
Predictably, it is the evergreen cell phone handset market that is primarily driving growth, with Castellano confident that over 600 million handsets will be shipped this year worldwide.
Handset PAs accounted for 53% of the total GaAs IC revenue in 2003, while WLAN applications contributed strongly with 22% of the market.
For the next two years, Castellano expects growth to flatten out, despite being bolstered by the implementation of WiMax and 3G cellular technologies. He believes that the GaAs IC market will grow a further 25% in 2005 and then by around 16% the following year.
If he's right, the 2006 figure of $5.65 billion would represent a doubling of the 2003 total.
One unpredictable element of the GaAs IC market is price erosion, which has resulted partly from the emergence of cheaper suppliers in the far East. Castellano estimates that the average selling price of GaAs ICs fell by 13% in 2003, and that prices will continue to drop by 10-15% each year.
He added that foundry revenues came in at $105 million in 2003, representing less than 4% of the overall GaAs IC market.
RF Micro Devices remains the number-one GaAs IC vendor, ahead of Skyworks. However, strong fluctuations in the dollar/yen exchange rate may see the Japanese group Eudyna Devices pull ahead of TriQuint, M/A-COM and NEC into third place in 2004.
TIN has also analyzed the SiGe IC market, and expects a steep ramp-up from now until 2006 as the use of such devices in optical communications and handsets increases. The market for SiGe ICs is expected to reach $2.15 billion in 2006 as SiGe devices take market share from GaAs devices in the receiver element of handsets, says the report.
