Frost: Mobile Handset Advancements Drive RF Semiconductor Markets
October 30, 2007 // Published as a news service by IHS
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Increasing mobile phone penetration in developing countries has created numerous opportunities for handset manufacturers, according to Frost & Sullivan, thereby directly driving the market for handset radio frequency (RF) semiconductors.
With the deployment of third generation (3G) in the pipeline, the market for RF semiconductors in these countries will likely thrive in the next few years.
Recent analysis from Frost & Sullivan of the world handset RF semiconductor markets found that among all segments considered, the RF transceivers market generated the most revenues, earning $3.045 billion in 2006, with estimates to reach $5.95 billion in 2010.
"Mobile handsets have evolved rapidly, from a simple and voice-only device to a sophisticated device that supports voice, high-speed data and other applications, such as global positioning system (GPS) and Bluetooth," said Frost & Sullivan research analyst Gokul Ramanujam.
"The adoption of 3G technology has also aided handset and RF semiconductor manufacturers with 3G phones requiring a design with higher complexity."
The handset RF semiconductor markets continue to steadily progress, with most segments showing significant growth. Analysts said the high volume shipments of mobile handsets over the last few years have greatly contributed to the growth of these segments.
With fourth generation (4G) technology and 3G long-term evolution (LTE) in the developmental stages, this market will likely grow exponentially in the future.
Analysts said the evolution of the mobile phone to a multi-dimensional device, however, has exerted enormous pressure on both handset manufacturers and RF semiconductor companies to pack in as many functions as possible in the limited front-end space. To stay in line with board space constraints and consumer demand, an emphasis on reduced component count, form factor and bill of materials (BOM) represents a key trend in the market.
"To enable this scenario, the kind of scaling proposed by Moore's Law would be ideal, but is not realistically possible in all cases," said Gokul. "A balance of all factors, such as reduced component count, combined with cost-effectiveness, is likely to assist RF semiconductor manufacturers in revenue generation."
The transition to integration has affected the market for discrete component manufacturers by reducing profits, as all companies in the value chain strive to increase their profits. Analysts said companies with a diverse product line and the skill to integrate discrete components into modules will likely succeed in this market.
Source: Frost & Sullivan.