MEMS Growth is back, but only a limited number of players benefit
Published on: 15th Sep 2010
Note -- this news article is more than a year old.
MEMS business was almost flat since 2007 this is good news compared to the semiconductor industry that has collapsed during that time, but as many companies have made production infrastructure investments from 2006 to 2008, 2009 has been really difficult for several MEMS manufacturers.
"The growth is back, but the industry infrastructure has changed: a limited number of companies are taking full benefit of the growth of the market. Industry restructuration is now about to happen…" announced Jean-Christophe Eloy, CEO & General Manager, Yole Développement.
Growth is back, but the growth has changed: only a few companies have 8" production infrastructure in place and it provides them a very strong cost benefit, helping them to target lower price consumer electronics applications. STM, Bosch, InvenSense (as a fabless) are taking full advantage of these changes. Now the question is: what will be the reaction of their competitors…
In parallel to this industrial situation, MEMS foundries are exiting stronger from the crisis: more system manufacturers have decided to stop internal MEMS manufacturing, so in addition to the organic growth of the MEMS fabless companies these system companies are now working with MEMS foundries. As such, MEMS foundries are extremely active at the moment with new customers looking to outsource MEMS manufacturing. This growth is attracting new players in MEMS foundry business, like TSMC, UMC… In addition, the Si interposer business opportunities, wafer level packaging and the 3D chip stacking using through silicon vias (TSV) are also growth drivers for the MEMS foundries. MEMS foundries are facing a vigorous growth and more than 25% CAGR expected in the next 5 years
Innovation in MEMS is changing: brand new devices are now launched on the market and a complete family of totally new MEMS devices are under development. The digital compass, the IR and thermography cameras, the oscillator … are driving these new generation of MEMS products. In addition, most of the new applications are linked to new usage of existing devices (human machine interface, replacement of existing technologies…). Strong efforts are put into the packaging adaptation in order to have a cost adapted structure (packaging is more than 40% of the cost of a MEMS device on average) and enter new applications (like mobile applications). New ways to package and integrate MEMS devices in a system are fueling the growth of MEMS industries.
According to Yole Développement, the MEMS market reached $6.9B in 2009 and will be around $8B in 2010. So 2010 is the start of the re-growth of the MEMS business.
A restart of the growth is expected after 2010, with a CAGR of 13% in the next 5 years. At the same time, the production equipment market remains low in 2009 at $140M and will restart in 2011: 2010 will be a better year, mostly in the second half.
Moreover the production infrastructure in place is sufficient to absorb the growth for the next 2 years. "We will have to wait 2011 for a significant restart of the MEMS production equipment market", explained Jean-Christophe Eloy.