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IDC sees bright spots amid chip slump

Posted: 09 Mar 2009     Print Version  Bookmark and Share

Keywords:Embedded processors  Bluetooth  Wi-Fi 

Embedded processors and connectivity chips are bright spots in an IC market that will see double-digit decline in computer and cellular chip sales in 2009, said Mario Morales, vice president of global semiconductor research at International Data Corp.

The need for more intelligence in a broad range of embedded systems is driving 15 per cent compound annual growth in embedded processors. Chips sales will rise from more than 300 crore (three billion) in 2007 to nearly 700 crore (seven billion) in 2012, IDC forecasts.

Less than three per cent of popular devices such as digital TVs and set-top boxes sport connectivity today, another ripe area for growth. Here combination chips that support multiple standards such as Bluetooth, Wi-Fi and others are rising from 20 per cent of today's connectivity chips to 60 per cent by 2012, Morales predicted.

"Companies focusing on platform plays that marry many technologies will be successful," he added in an interview at the annual IDC Directions event here.

Having weathered many up and down cycles already, "the semiconductor industry is still very resilient," Morales said.

It will need to be resilient. In a forecast released in February IDC said the first half of 2009 will be more severe than the last quarter of 2008, the overall economy won't bottom out until the end of 2009 and it won't recover until mid 2010.

"The biggest concern is there's no visibility on demand," said Morales. Companies carrying a lot of debt that requires renewed financing in the next nine months are at the most risk. "They are in real trouble," he added.

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