Despite short-term hiccups in the cellular IC market, long-term growth will be impressive, according to a new Allied Business Intelligence (ABI) report. Increased demand for enhanced cellular handsets that have higher IC content than current 2G devices will fuel new growth in the market. According to the study, the total available cellular integrated circuit (CIC) market will grow from US$9.7 billion in 2001 to US$31.5 billion in 2006.
Slow network upgrades have stalled the market for ICs used in cell phones. However, phone makers are including attractive features in next generation phones to lure in buyers regardless of the status of network upgrades "In turn, tomorrow's feature laden phones will fund lucrative growth in the IC market" said Andy Fuertes, Director of Wireless Research. "Phones will cease to be just phones and IC vendors will benefit from a virtual endless potential for upgrades and increases in features."
The move toward complete solutions will impact gallium arsenide (GaAs) and silicon players alike, as multimedia functionality is emphasized over conventional communications. Consolidation and convergence will be pervasive in all stages of cellular handset design, as next generation technologies lure newcomers into the cellular space. As GSM, CDMA, TDMA, AMPS and 2.5G technologies endure, the grand debut of integrated 3G IC solutions is delayed. As a result, the bill of materials for 3G phones will warrant a 79% increase from today's basic GSM model. Additionally, the semiconductor value is estimated to be 49% greater than that of 2.5G devices."
Posted to the site on 5th March 2002
Posted to: www.cellular-news.com/story/5989.php