CE chip firms must merge or die: iSuppli

Michael Carroll
15 Oct 2010
00:00

Manufacturers of semiconductors used in consumer electronics equipment must merge or die in the next five years, iSuppli says.

The research firm predicts growing development costs for application-specific semiconductors will spark a raft of consolidation among leading players, and drive second- and third-tier manufacturers out of the market entirely.

Competition in the sector is already fierce, it noted, with only Toshiba holding a market share over 10%.

Analyst Jordan Selburn said a high-value consumer electronics contract “could make $100 million or more during the life of the device.”

Broadcom’s $316 million acquisition of 4G chip maker Beeceem earlier this week lends credence to iSuppli’s prediction.

This year says all players will benefit from a rebound in CE sales, which are forecast to grow 27.7% to $57.2 billion, reversing a 15.7% decline in 2009.

Latest figures from the Semiconductor Industry Association predict total semiconductor sales will hit $290.5 billion in 2010, up 28.4% on 2009.

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