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Strong growth predicted for linear market

5 November 2003 News

Functional standard analog blocks are required in every application - from I/O to signal conversion. The notion that specialisation will continually eat away at the commodity market, as suppliers innovate and integrate everything onto 'one chip,' is still widely held by many industry pundits. Because of this, the prevailing forecasts call for higher growth in the application specific markets versus high performance and commodity analog.

However, there are several factors that are contradictive to this assumption.

Applications are increasingly requiring high performance products at lower price points, end equipment design cycles have contracted substantially, and high volume electronics continue to evolve into homogenised products that cross over into multiple segments (so-called 'convergence' devices).

The communications market has historically been application specific intensive, but as end equipment manufacturers struggle to meet an increasingly standardised market dynamic, demand is shifting to modular solutions which are enabled by lower cost standard products. Further, ASIC design starts are shrinking due to the high cost of development, and due to the increasing technological complexity of integrating functionality onto a single device - without sacrificing performance and power efficiency within the allotted time frames of rapid production cycles.

Telecommunications companies simply do not have deep pockets and large labour forces these days. These companies are standardising both on an industry level and internally across product lines. Other market segments are also exhibiting this trend, which translates into strong demand for standard linear products, and the potential for displacement of application specific solutions.

Databeans estimates that worldwide standard linear revenue will increase over 20% this year over last year. Standard linear includes both high performance and commodity analog. Application specific analog revenue is also expected to recover this year, but not to the same extent as standard linear. Further, unit shipments for standard linear will outpace analog ASIC unit shipments by two to one. Databeans expects this trend to continue longer term, and estimates that standard linear shipments will reach a volume of two and a half times the application specific market by 2008.

For more information contact Susie Inouye, Databeans, info@databeans.net, www.databeans.net





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