Sign of the Times: Wireless displaces computers
Global spending by the world’s top OEMs on microchips for wireless products amounted to $58.6 billion in 2011, up 14.5 percent from $51.2 billion in 2010, according to information and analysis provider IHS. This allowed wireless to exceed computers to become the world’s largest OEM semiconductor spending segment in 2011.This is not the first year that wireless spending has been larger than for computers, with wireless having led as recently as 2009. However, 2011 does mark the beginning of a period when the balance of semiconductor spending will shift decisively toward wireless and away from computing. In 2013, OEM wireless spending is projected to soar to $72.9 billion, while computers will remain flat at $53.4 billion.”Among the 10 segments tracked for semiconductor spending, the biggest market share—at 24 percent—belonged to the wireless market, spurred by prodigious mobile handset and tablet sales exemplified by the runaway success of Apple’s popular offerings,” said Wenlie Ye, analyst for semiconductor design and spend at IHS. “Wireless will continue to generate the most growth during the next two years. A substantial portion of the segment’s increase will be due to rising tablet sales, although mobile handsets like smartphones will continue to account for the lion’s share of semiconductor segment in the wireless area.”Meanwhile, computer semiconductor spending in 2011 rose by just 4 percent to $53.7 billion, up from $51.8 billion in 2010.”The market for desktops and notebooks has stumbled in the shadow of smartphones and tablets, whose portability and computer-like features have usurped the position of the once-mighty PCs,” Ye said. Apple takes the tabletsIn the fast-growing tablet space, Apple in 2011 spent more than any other OEM on semiconductors, to the tune of $4.6 billion. The iPad continues to be unmatched in its class despite earnest efforts from rival products to loosen its hold on the market. Samsung Electronics Co. Ltd. was a very distant second after Apple with $603.2 million, followed by HTC Corp. from Taiwan with $199.2 million. Hey big semiconductor spenderTotal semiconductor spending among the industry’s major OEMs for all application markets in 2011 reached $240.6 billion, up approximately 5 percent from $230.1 billion in 2010.Although growth last year was much more modest after the massive 32 percent expansion of 2010, overall semiconductor spending levels rose for the second straight year, and there was no indication that the industry would retrench to the dark days of 2009 when spending contracted by a steep 13 percent.The IHS iSuppli estimate and forecast tracks the spending made on semiconductor chips by the top OEMs and brands, covering a pool of 191 companies that together account for nearly 80 percent of the entire global semiconductor trade. An OEM or brand is assigned the entire sum of the semiconductor spending that it conducts by itself, or when it does so indirectly via a contract manufacturer that buys chips on behalf of the OEM or brand.