Focus on gyroscopes for mobile phone apps: Yole

Laurent Robin, MEMS market analyst, Yole Développement, presented on gyroscopes for mobile phone apps during a MEMS market briefing in Tokyo, at MEMS/Micromachine 2010.

He presented an overview of the MEMS inertial sensor market, as well as a status of the gyroscope market in consumer applications. He focused on gyroscope for mobile phone applications and a combination of motion sensors for mobile phones.

Overview of MEMS inertial sensor market
Robin presented an overview of the MEMS accelerometers and gyroscopes market.

MEMS accelerometers
CE: $596.84 million in 2010 going up to $799.80 million in 2013. The CAGR 2008-13 is 17 percent.
Automotive: $462.85 million in 2010 going up to $574.62 million in 2013. The CAGR 2008-13 is 4.7 percent.
Industrial & Medical: $96.28 million in 2010 going up to $126.04 million in 2013. The CAGR is 4.4 percent.
Aerospace & Defense: $92.61 million in 2010 going up to $128.12 million in 2013. The CAGR is 10 percent.

MEMS gyroscopes
CE: $296.09 million in 2010 going up to $701.60 million in 2013. The CAGR 2008-13 is 27.3 percent.
Automotive: $473.43 million in 2010 going up to $521.56 million in 2013. The CAGR 2008-13 is 2.5 percent.
Industrial & Medical: $12.43 million in 2010 going up to $16.90 million in 2013. The CAGR is 10.6 percent.
Aerospace & Defense: $128.69 million in 2010 going up to $177.03 million in 2013. The CAGR is 9.7 percent.

Status of gyroscope market in consumer apps
The 3-axis gyroscopes are now available. As expected, Invensense and ST Microelectronics have released the first 3-axis gyroscopes in Q4 2009.

Those 3-axis gyroscopes are starting to be integrated in some handset platforms in the summer of 2010. The price is now low enough for high-end smartphones: around $2.50 probably. However, it will have to decrease quickly for further adoption.

The 2009 MEMS gyroscope market share for CE applications is estimated at $258 million. As for the market shares, five competitors — Invensense, Epson Toyocom, Panasonic, Murata and — ST are playing in the consumer electronics gyroscope market today. Invensense and ST are strongly competing to enter this promising mobile phone market. The Japanese players have not extended their camcorder and camera business to mobile phones yet.

Where are the MEMS markets going?

Yole Développement and its partner System Plus Consulting recently took part in MEMS/Micromachine 2010. Jean-Christophe Eloy, president and CEO, Yole, presented a MEMS Markets forecast 2009-2015: overview of the Industry and technologies trends. May I also take this opportunity to thank Sandrine Leroy, media and PR manager, Yole.

MEMS remains a fragmented market: A limited number of applications have a market size above $200 million.

Simplification of manufacturing is still an objective. The MEMS law – “one product, one process, one package” is still there. MEMS packaging is more and more an “added value step” with 3D MEMS being more widely adopted. Also, software development is now an important competence in MEMS companies in order to sell functions and not devices.

The development of new MEMS applications is taking years to be commercialized. On an average, four years from first developments to first commercial product and $45 million of investment, and three to four different CEOs.

Several major system companies with MEMS fabs are now looking to use external foundries. At least five major companies are involved in such changes, with a total cumulative business of $350 million. Delphi and Conti have already taken this decision.

The 8’’ manufacturing infrastructure is required for companies targeting consumer electronics.  It should be noted that MEMS manufacturers not involved in consumer electronics are facing a very strong risk to lose competitiveness.

Competition is also increasing on consumer electronics applications. STMicroelectronics  is now proposing accelerometers, gyroscopes, microphones and digital compass. Also, Invensense is searching in its IPO large extra funding to compete on motion sensing applications.

Ranking of MEMS Foundries; Source: Yole Développement, France.

The MEMS foundry production services market traditionally develops at 20 percent AAGR. The back to normal growth will happen in 2011.

Emerging MEMS market
A note on the emerging MEMS market. Areas such as MEMS ID, ustructures, energy harvesting, uFuel cells, electronic compass, microtips, microdisplay, autofocus/uZoom, MEMS oscillators, and MEMS speakers are said to be emerging.

The emerging MEMS market share was $559 million in 2009, including auto focus — 57.7 percent, digital compass — 22.4 percent, micro tips for ATE – 10.4 percent, and microbolometers cores — 7.5 percent, respectively.

The emerging MEMS market share is likely to reach $2.2 billion in 2015, including auto focus — 36.1 percent, digital compass – 17.1 percent, and micro displays – 15.9 percent,  respectively.

Reshaping the embedded world: Vivek Sharma, ST

Vivek Sharma, regional VP, Greater China & South Asia region -- India Operations and Director, India Design Center, STMicroelectronics.

It was a pleasure to catch up with Vivek Sharma, regional VP, Greater China & South Asia region — India Operations and Director, India Design Center, STMicroelectronics, on the sidelines of the 4th Embedded Systems Conference (ESC) 2010 in Bangalore. We had a wonderful discussion on the trends that are reshaping today’s embedded world.

Sharma said: “Moore’s Law has governed many new things. In fact, it has ruled the roost. The industry has been able to push up complexity within a chip and also bring down costs.” As an example, during the last two decades, cost and complexity have combined to create the mobile device — which has turned out to be a disruptive application. The world recently added its 5 billionth mobile subscriber in July 2010. There is likely to be a whopping 50 billion connected devices by 2020!

SiP reshaping embedded world

Touching upon ‘more than Moore”, Sharma added that shrinking will keep on happening. System-in-package is a reality today and is reshaping the embedded world. It can allow more shrinking in size and push down costs.

Borrowing from wikipedia, for those interested, a system-in-a-package or system in package (SiP), also known as a chip stack MCM, is a number of ICs enclosed in a single package or module, and performs all or most of the functions of an electronic system.

3D heterogenous integration and  TSV

3D heterogenous integration and  through-silicon via (TSV) is another trend reshaping the industry. 3D packaging with 3D TSV interconnects provides another path toward “More than Moore”, with relatively smaller capital investments.

3D-ICs stack multiple chips together and interconnect them using through-silicon via (TSV) structures, thereby providing much more functions in a smaller footprint.

MEMS key segment

MEMS is yet another sector which is reshaping the industry. Sensors play a major role in our lives. “If we can develop good sensors, they can change our lives,” said Sharma.

“Accelerometers and gyroscopes are two key segments with substantial growth. MEMS takes advantage of the electrical and mechanical properties of the silicon.’ Sharma added that all MEMS gyroscopes take advantage of Coriolis effect. In 2009, ST introduced over 30 multi-axis gyroscopes.

For the statistically inclined, earlier this year, Dr. Robert Castellano of the Information Network said in their report 3-D TSV: Insight On Critical Issues And Market Analysis, that while the overall equipment market will grow at a CAGR of nearly 60 percent between 2008-2013, the metrology/inspection sector is expected to grow nearly 80 percent. On the device side, TSVs for MEMS is expected to grow nearly 100 percent in this time frame.

New frontiers in MEMS around the human body

At the recently held International Electronics Forum (IEF) 2010, organized by Future Horizons in Dresden, Germany, Benedetto Vigna, Group Vice President and General Manager, MEMS, Sensors and High Performance Analog Division, STMicroelectronics, made a wonderful presentation on how MEMS can be useful for the human body, especially from the medical electronics point of view.

MEMS (microelectromechanical systems) is a three-dimensional device embedded in silicon, and uses silicon’s mechanical (and electrical) properties. It supports multifunctional systems of actuators, electronics and sensors.

Three critical waves of MEMS
Vigna highlighted the three very important waves of MEMS — automotive airbags, consumerization, and MEMS in, on, around the body! The last part especially is the most interesting one!

Automotive airbags formed the 1st wave of MEMS. The application supported big and not-so-precise accelerometers. Additional automotive applications followed, such as tyre pressure sensors and stability control. Vigna heralded consumerization as the 2nd wave of MEMS. There have been high-volume fabrication techniques, leading to higher performance/greater reliability at lower costs. He specifically pointed out the ‘Wii effect’! In this case, the high-volume commitment of vendors + UI benefits led to consumerization of MEMS.

Vigna added that MEMS has seen a speeding spiral of success in recent times. Earlier, it took 25 years from labs to fabs. Now, three product generations are developed and released in 12 months!

Another instance or example of the 2nd MEMS wave include the move from keyboard and mouse to free motion. In this case, the MEMS sensors change interaction with consumer electronics and propel new applications. There are now:
* Motion user interfaces in phones, games and remotes.
* Advanced navigation and location-based services.
* Free-fall protection in portable devices.

MEMS market
Vigna focused a moment on the MEMS motion sensors market 2009-2013 and the MEMS market. As far as the MEMS motion sensors market is concerned, accelerometers are likely to grow at 14.5 percent CAGR for the period 2009-2013. On the other hand, gyroscopes are likely to grow at 17.3 percent CAGR during 2009-2013.

Cell phones and CE is the major market segment in both cases, registering 19.5 percent CAGR and 25.4 percent CAGR, respectively, followed by automotive at 10.7 percent CAGR and 12.3 percent CAGR, respectively.

It is to be noted that in 2009, the overall MEMS market was almost flat compared to 2008, but volumes rose significantly, showing increasing penetration of MEMS in consumer devices.

Current trends in MEMS
Coming on to the current trends, MEMS is now pushing the limits of size and power — motion sensors are squeezing the footprint to 2×2 mm and current consumption well below 10uA in full operating mode. Multiple sensor integration is another trend. The integration of motion, magnetic, pressure and temperature sensors in a single package brings more degrees of freedom.

Embedded intelligence is the third key trend. The on-chip processing capabilities are enabling smart autonomous sensors and decreasing power consumption at the system level. Finally, software, is now the ‘S’ in MEMS! Vigna said that hardware and software integration is a key added value and differentiating factor.

Round-up 2009: Best of semiconductors

Right folks! We’ve now come down to the last day of what has been one of the worst years, or the worst year ever, in the history of the global semiconductor industry!

After a very tough first half of 2009, things did start looking up in the second half, and that trend has continued right up to the end of the year. It is a sincere wish that this trend continues well into 2010 and 2011, thereby allowing the industry to scale great heights again.

Presenting a list of leading semiconductor industry related posts that mattered in 2009. Here you go!

SEMICONDUCTORS

Reviewing global/Indian semicon industry in 2008 — top posts

Consumer MEMS shine amid gloom: iSuppli

Global semi to dip by 28pc in 2009; Indian semi to grow at 13.4pc by 2010! Don’t get carried away!!

What the semiconductor industry should do in 2009!

Indian semiconductor market to reach $7.59bn by 2010!

Global semiconductor industry could well see revival in 2010?

Can the Indian semicon industry dream big? (And even buy Qimonda?)

Indian silicon wafer fab story seems dead and buried! Should we revive it? — A topic everyone loves to talk about, but do very little!

ISA Vision Summit 2009 lacks the punch!

What India now offers to global semicon industry! — Need to look beyond embedded and design services! Top read!!

ISA Vision Summit 2009: Indian design influence, ideas to volume

Definite need for rethink on India’s fab strategy!

Time for Indian semicon to step up! Yes or No?

Infineon on India’s e-passport and semicon industry

Indian chip industry dead? You’ve got to be kidding me!

How semicon firms can achieve high performance by simplifying business!

How semicon firms can achieve high performance — Part II

ISA’s BV Naidu on India’s way forward in semiconductors

Clearly, mixed signals in OEM semiconductor design activities!

What needs to be done to boost chip designing activities in India?

Freescale’s Rich Beyer on semicon and industry trends

Cypress on Indian semicon industry trends; launches PSoC 3 and PSoC 5 architectures

Chip market outlook: Back to normal abnormality? — Malcolm Penn @ IEF2009, Geneva

Excerpts from Future Horizons’ International Electronics Forum 2009 @ Geneva

Excerpts from Future Horizons’ IEF 2009 — II

Strong semicon industry recovery likely in 2010! — The first signs of recovery for an industry in trouble!

What does it take for students to be (semiconductor) industry-ready! — a top read article, especially for students!

Building pillars of India’s tech infrastructure: Dr. Bobby Mitra, TI India

Top 20 semicon suppliers of 2009! — One of the most read articles of the year!

Future Horizons signs me as its India affiliate! — I can’t wait to do events, research reports etc. in India! 😉

2009 ending with lot of positives for global semiconductor industry

Semicon update Dec. ‘09: Q4’s off to a great start; is ‘plan B’ in your back pocket?

Nov. 09 update: -10 percent growth in 2009, +22 percent minimum for 2010, says Future Horizons

My dear friends, it has been an absolute pleasure bringing to you the trials and triumphs of the global and Indian semiconductor industry this year. Hope to carry this forward in 2010 and beyond.

In case I’ve missed out certain posts, do point out those. A list of posts related to EDA and embedded systems are presented elsewhere on this blog. Also, it is not possible for me to select the top 10 articles for the year. If anyone of you can, I’d be very delighted.

My best wishes to you, your families and loved ones for a happy and prosperous 2010. Take care, God bless, and see you all very soon next year!

MEMS likely to see strong recovery in 2010!

Recently,Jérémie Bouchaud – Director and Principal Analyst, MEMS, iSuppli, ran a program on High-margin MEMS: Medical, Industrial and Aerospace.

According to Bouchaud, the MEMS market is not immune to the downturn and is down 8 percent in 2009. The bottom was hit in Q1-09. However, the MEMS segment is likely to see strong recovery and regain double digit growth in 2010.

The high end markets enjoy similar growth as consumer and mobile MEMS markets. It has grown at 16 percent CAGR from 2008-2013. There are opportunities for small companies and foundries. Volume manufacturers have also come to high end markets.

Overview for high-margin MEMS
Providing a market and suppliers overview for high margin MEMS from 2008-13, he said: “We don’t believe MEMS market is immune to the current market conditions. It went down 5 percent in 2008 and 8 percent in 2009. The last quarter of 2008 was very bad.

Not only automotive applications are suffering, the entire industry is suffering. Only a few segments in consumer electronics and cell phones, etc., are doing better. However, going 2010 onward, MEMS industry will see +11.5 percent growth from 2009-2013.

Coming to MEMS market by applications, mobile and CE are driving growth. They are not going down in 2009, but slightly growing by 4-5 percent. Most of the other applications are going down, however. Areas such as military and civil aerospavce, medical electronics, industry and process control, are interesting.

High margin MEMS is growing as fast as CE and mobile MEMS — 16 percent CAGR from 2008-2013. Industry and process control will be biggest part of the market by 2013. Also, medical electronics and military and civil aerospace should do well, added Bouchaud.

This market should be more stable than what it is presently. MEMS wafer probe cards, e.g., is extremely dependent on the memory market, which has been going up and down. Demand for memory has been bad in 2008 and 2009.

He also presented a brief overview of the top suppliers for high margin MEMS — such as Formfactor, Honeywell, GE Sensing, FLIR Systems, Epson, DRS, JDSU, BAE Systems, MEAS and Panasonic.

Formfactor is the leading manufacturer, especially in wafer probes. Honeywell is a significant player, strong in accelerometers, gyroscopes for aerospace and defense applications. GE Sensing is a leader for pressure sensors for medical applications. FLIR Systems is a leader in microbolometers for industrial and defence application. Epson is a leader for professional inkjet applications. Panasonic is a key player in pressure sensors, accelerometers, etc. JDSU is a purely fabless optical MEMS company. MEAS has a number of products — accelerometers, vibration sensors, flow sensors, etc.

Bouchaud also discussed the leading MEMS foundries for higher MEMS, where iSuppli calculated the revenue for high margin MEMS products only. These include companies such as Microalyne, Silex, IMT, Tronics, GE Sensing, Coilbrys, Menscap, Dalsa, Honeywell, Semefab, Microfab Bremen, X-Fab, MEAS and APM.

 

This is a very diverse picture, he said. “We have pure play foundries — purely focused on high end MEMS markets, such as Micralyne, IMT, Tronics.” Another group is covering both high end and volume markets such as consumer and automotive — like Silex, Dalsa, APM, etc. Then, there are those with mixed models, which are IDMs, such as GE Sensing, Colibrys, Memscap, Honeywell, etc.

Strong impact of recession on top 30 MEMS makers

Presenting: The top 30 MEMS (microelectromechanical Systems) suppliers of 2008, thanks to Yole Développement (www.yole.fr), in Lyon, France.

“For the first time, STM is the third MEMS manufacturer worldwide. Overall sales of the top 30 MEMS manufacturers decreased by 2 percent compared to previous year, reaching $5.5 billion,” says Jean-Christophe Eloy, CEO of Yole Développement. The current economic crisis strongly impacts the 2009 edition of the top 30 MEMS manufacturers.

The preliminary top 30 MEMS manufacturers is based on Yole’s market research and expertise covering the MEMS field with more than 2,500 contacts per year. Yole Développement continues to analyze in detail the MEMS market and to follow the Top 30 MEMS manufacturers to deliver the most accurate information available, specifically in these times of big changes.

Major facts in 2008
In 2008, the MEMS market has seen significant changes in the ranking of the top 30 MEMS companies:

* STM has become, for the first time, the 3rd MEMS manufacturer by $ revenue in 2008.
* Delphi and Sanyo are moving out of the TOP 30 MEMS ranking.
* Kionix and IMT are entering the Top 30 MEMS ranking for the first time.
* IMT is again the world leader in the independent MEMS foundry business.
* HP and Texas Instruments, despite decreases in sales, are still numbers 1 and 2 of the top 30 MEMS ranking.

2008 has been a year of unusual movement in the industry:

* The winners: Eighteen (18) companies have shown growth ($ revenue) in 2008 compared to 2007, with Kionix leading the way with 70 percent, and also Measurement Specialties, STM, Panasonic and Murata, to name a few.

* The loosers: Twelve (12) companies have shown a decrease in sales ($ revenue) in 2008 compared to 2007 (in addition to Sanyo and Delphi exiting the top 30 ranking), with FormFactor, Silicon Sensing Systems and Lexmark showing the largest decrease in sales.

Note: The top 30 MEMS Manufacturers graph only considers companies designing and/or processing Si MEMS chips. So, for example, although Sensata is an important sensor manufacturer, its ceramic technology excludes it from the Top 30 ranking.

Economic crisis, specific impact on each MEMS sector
The economic crisis has definitively had an impact on MEMS companies’ financial results, specifically during Q4 2008. However, this impact is very different according to the various MEMS players’ markets. The automotive business is probably the most dramatically impacted by the downturn. In terms of units, it is in the range of -10 percent to -20 percent less compared to previous years.

However, some companies suffer less than others (as is the case for Robert Bosch for example) but all of them are impacted. The impact is also different according to the maturity of MEMS products. Established devices such as airbag accelerometers are suffering more than emerging devices (e.g. TPMS).

The consequences in consumer markets are also different, depending on the MEMS products. Manufacturers of inkjet heads are suffering a lot, with a decrease of about 15 percent IJH production for 2008. On the other hand, inertial MEMS products for the consumer market are still growing (in the range of a several percent) with some players (e.g., STMicroelectronics and ADI) showing pretty good results.

Major MEMS facts to be highlighted in 2008 are:
* Systron Donner Automotive had a very strong decrease because of its automotive business (- 14 percent in US$). This moves it from 10th position in 2007 to 13th in 2008.
* IJH players are dramatically impacted with a decrease in both sales and units (this is the case for HP and Lexmark, the latter undergoing the strongest decrease for IJH). However, HP is still the number one MEMS company for 2008.
* Texas Instruments has seen decrease in its DLP chip sales by about 13 percent (in US$).
* Thanks to its growth of the consumer market, STMicroelectronics’ MEMS business had a profitable 2008 with US$200M for its accelerometer business (twice 2007 sales). This is + 42 percent in euros. STMicroelectronics moves from 4th position in 2007 to 3rd in 2008.

Although it is probably the automotive MEMS player performing the best in 2008, Robert Bosch underwent a -10 percent decrease in euros compared to 2007. Its 8’’ fab is now ready, but production will start only when the economic conditions improve. So, Bosch is moving from 3rd position in 2007 to 4th in 2008.

* Avago has bought the BAW activity of Infineon in Q4 2008, however this sales volume (Yole Développement estimates to be $38 million) has been consolidated into Infineon’s 2008 financial results.
* VTI is suffering because of the automotive market slowdown (- 10 percent in euro).
* Boeringher Ingelheim microParts showed good performance (+ 9 percent in euro), showing that the biomedical market was not impacted by the crisis.
* Panasonic had a very good 2008 with a 10 percent increase in yen compared to 2007.
* Yole believes Panasonic has taken market shares in gyroscopes from Murata and SSS, which show – 4 percent and – 12 percent decreases in yen respectively. Panasonic is now in 16th position (19th in 2007).
* MEAS’s good performance (+ 57 percent in US $) is explained by the integration of Intersema’s sales results. MEAS is now in 19th position (24th in 2007).
* FormFactor underwent the strongest decrease (- 51 percent in US$). This moves it to 27th position (20th in 2007).
* IMT did quite well (+ 15 percent in US $), while Colibrys was affected (-19 percent in US $ and closing of its US activity).

This year, Sanyo and Delphi have disappeared from the 2008 ranking; Sanyo has stopped its foundry activity and Delphi has dramatically reduced its MEMS staff. We believe that only development/assembly will be kept.

How will the future be? Such a crisis will come to an end only when device stock levels fall. Some information from Taiwanese players seems to indicate a restart of semiconductor production. Although it could also be the case for MEMS, Yole believes that 2009 will be a flat year for the MEMS market.

Consumer MEMS shine amid gloom: iSuppli

I was fortunate enough to attend a webinar on MEMS organized recently by iSuppli. The webinar looked at the growth potential of this segment, especially during the downturn, as well as some top MEMS suppliers.

According to Jeremie Bouchaud, director & principal analyst, both consumer and mobile MEMS supply has been exploding. The overall MEMS market is likely to grow from $1 billion in 2006 to $2.5 billion in 2012! There will be strong acceleration due to growth of cell phones — a hotbed for MEMS, he said.

However, the share of MEMS for rear projection TV is vanishing. A market worth $300 million in 2006 is slowly disappearing, and will, in fact, disappear by 2012. Among other growth areas, personal navigation devices (PNDs) and remote controllers will also see growth.

Consumer and mobile market by MEMS device
The main segments include accelerometers, as well as gyroscopes, RF MEMS switches and capacitors, microphones, etc. The penetration of MEMS devices in CE products is said to increase quite fast.

MEMS growth in cell phones will be faster. It will grow from 3 percent in 2007 to 10 percent in 2008. All of the new, best selling smartphones, such as the iPhone, Nokia N95 and N96, Samsung Omnia, HTC Diamond, Google G1, Blackberry Storm, new Palm OS, etc., have accelerometers. A number of mid range phones also have accelerometers, eg. Sony Ericsson’s models.

MEMS usage is also growing in gaming. From 1998-2005, there was technology push with limited success. However, in 2006, Nintendo showed the way with its Wii, as did the Sony PS3. Microsoft did not enter this field back then!

Interestingly, 2006-08, motion sensing unveiled new, untapped target groups for gaming — the so called casual gamers. In Xmas 2008, Microsoft also embraced motion sensors with accessories. Hence, the penetration of motion sensors has really improved. The next third generation platform will include accelerometers and gyroscopes.

Top 15 MEMS suppliers
The key question: who all are shipping these products? According to iSuppli,The top 15 MEMS suppleirs for CE and mobile phones are: STMicroelectronics, Texas Instruments, Avago Technologies, Knowles, Analog Devices, Murata, Kionix, Epson Toyocom, Invensense, Panasonic, Bosch Sensortec, Freescale, Hokoriku, VTI and Memsic.

Some other companies to watch are:
Accelerometers and gyroscopes: Qualtre, Oki, Wacon, Alps, Virtus, Ricoh.
Pressure sensors: Intersema (MEAS), Metrodyne.
Microphones: Infineon, Wolfson, Memstech, Yamaha, Omron, Panasonic, MEMSensing, AAC, Goertek.
Pico-projectors and other MEMS displays: Microvision, Nippon Signal, Samsung, Konica Minolta, Scanlight, Qualcomm, Pixtronix, Unipixel
RF MEMS switches and capacitors: Wispry, Epcos, RFMD, Baolab.
MEMS oscillators: SiTime, Discera, NXP, Seiko, Intel.
BAW filters: Triquint, Skyworks, MEMS Solutions.
MEMS actuators for autofocus and zoom: Simpel, Sony.
Micro-fuel cells: Angstrom, Tekion, Medis.

It is understood well that not all of these companies will be successful. However, they all need to be monitored carefully.

Commenting on cell phones as a hotbed for inertial and magnetic sensors, Dr. Richard Dixon, senior analyst MEMS, iSuppli, said that the market for accelerometers, gyroscopes and magnetometers is in cell phones. This market will reach $730 million in 2012. Gyroscopes are not in the market yet, and are likely to enter by 2010. The total growth rate is very fast. In units, the annual growth rate is said to be 97 percent.

Interestingly, Apple has contributed significantly to growth of MEMS. The iPhone had a great application. Other vendors followed suite with a ‘me too” strategy. Apple also had sustainable business model with downloads on the Apple Store. The chicken and egg issue of price was solved. Also, with the iPhone, there was a free field test of motion sensing based applications.

Major suppliers of accelerometers for cell phones today, include STMicroelectronics, Bosch Sensortec, Analog Devices, Hokuriku, Kionix, MEMSIC, Freescale, Oki. Of these, ST has really been very impressive, while Bosch saw impressive growth in 2008. MEMSIC dropped share in 2008.

Navigation in cell phones next big thing
According to Dixon, navigation in mobile phones is the next big thing. Leading navigation markets by platform are: mobile phone navigation, smartphone navigation, PNDs, car aftermarket and car OEM in-dash, respectively. By 2010, the mobile phone/smartphone navigation segment will account for over 60 percent of the market.

Similarly, magnetic sensors will take off in 2009 for e-Compass. There has been penetration of magnetometers in GPS phones. They have been around since 2003 in Japanese phones. These rather esoteric applications and also had technical issues.

There were successful implementations in 2008 for navigation. Eg., the G1 Street View, and the Nokia 6210. Also, 3D compass in combination with 3D accelerometers.

The leading suppliers in this space today, include AKM, Honeywell, Yamaha, Aichi Steel. In the R&D segment, the leading players are said to be Alps, Omron, Memsic, Oki, ST, Freescale, Demodulation. Growth will be steep from 2009 onward, and take off from 2010 up to 2012.

Another growth are is the multi-sensor packages and IMUs (Inertial Measurement Unit) for navigation. Today, we have six-axis e-compass combining magnetic sensors and accelerometers. In future, there will be IMU for LBS and indoor navigation also using gyroscopes.

The issue with gyroscopes is of: performance, price, size, power consumption and no availability of three-axis. Companies that need to be watched in this space are said to be Invensense, ST, Bosch Sensortec, Qualtre, Oki, Virtus.

Other opportunity areas
Later, Jeremie Bouchaud highlighted two other opportunity areas.

MEMS microphone market presents a major opportunity. It will reach close to $400 million by 2012. In 2008, already 325 million units were selling in cell phones and laptops. Leading players in this segment are said to be Knowles, Akustica, Infineon, Sonion, Memstech, AAC. Knowles has over 90 percent of the market share.

MEMS pico projectors is another growth area. Companies have made lot of progress in this segment. The pico projectors come in various varieties.

In the MEMS scanner based segment, the R&D is led by firms such as Microvison, Konica, Minolta, Scanlight, Nippon, Signal, Symbol. These solutions came first as stand alone projectors. Later, it will come on cell phones. The best opportunity is said to be at the module level.

Another sub-segnent is the DLP based projectors. First it will be in form of a pico-projector, later, followed by usage in cell phones.

Bouchaud advised watching out for non-MEMS alternatives, such as Light Blue Optics,
3M and Logic Wireless.

Coping with commoditization and price erosion
The ASP of MEMS devices for CE and mobile phones is dropping at -13 percent per year. So, what are the ways to get profitable?

To be profitable, there is a need to achieve economies of scale by combining consumer and automotive. Also, there is a need to
move wafer size to 8-inch. Next, there is a need for externalizing to foundries. ADI and TSMC have already showed the way. Now, USMC, Tower, Dongbu, Magnachip, Omron, etc., are following.

Innovation, in terms of packaging and 3D integration, test, multi-sensor packages, is another way for making profits. There is an opportunity for the equipment suppliers as well.

Consumer MEMS is currently glowing as a light in today’s dark times! It is said to grow from $1 billiom in 2006 to $2.5 billion in 2012, with 19 percent CAGR. This optimistic forecast has already started. Accelerometers are present in 10 percent of cell phones in 2008 as against 3 percent in 2007.

There exist a number of opportunities. Small companies can be successful, eg. Kionix and Invensense. There are still opportunities for newcomers. These can be large companies, fabless startups, foundries, software companies, equipment suppliers, etc. Consumer MEMS is an extremely dynamic market, having fast design cycles.

Motion sensors driving MEMS growth

In a recent report, iSuppli predicted that driven by new demand from consumer electronics (CE) and wireless applications, the global market for microelectromechanical systems (MEMS) will expand to $8.8 billion in 2012, up from $6.1 billion in 2006.

I caught up with Jérémie Bouchaud, Director and Principal Analyst, MEMS, iSuppli Corp., to find out more about the dip in the fortunes of the mainstay products and the latest trends in the MEMS market, especially, the significance of consumer electronics applications such as motion sensors for gaming, laptops and DSCs, and mobile handsets.

Will the mainstay products for MEMS actuators, inkjet heads and DLP chips, will lose market share? Or, is it a slight dip?

Jérémie Bouchaud says that MEMS actuators, include inkjet and DLP, and also RF MEMS switches. While selling prices stay constant, MEMS inkjet heads are losing shipments at a rate of 6 percent per year over the forecast period, so the market grows only slightly at 0.4 percent CAGR from 2006-2012.

DLP shipments continue to grow, but price erosion is running at 10 percent CAGR, which means that the market is shrinking at close to 5 percent per year to 2012. RF MEMS switches are the one bright spot that helps the market for this type of MEMS device to recover slightly in 2012. RF MEMS switches will grow at 100 percent CAGR over this time to top $260 million in 2012.

The new wave is partly founded in the rapid rise of consumer electronics applications such as motion sensors for gaming, laptops and DSCs, and mobile handsets. How much share are these segments likely to garner?

According to the analyst, all types of sensors in wireless communications and consumer electronics (inertial, pressure, microphones, filters, oscillators etc) exceed $1,5 billion: or 17 percent of the total MEMS market.

“Specifically, the motion sensing opportunity, including accelerometers and gyroscopes, for consumer applications like MEMS accelerometers for mobile phones (e.g., image rotation such as in iPhone and Nokia phones), gaming (Nintendo Wii, Playstation 3), etc., and gyros (mostly digital still cameras and camcorders, gaming like Playstation 3) will grow at over 20 percent CAGR from 2006 to 2012 to exceed $680 million, about 8 percent of the total market,” he said.

iSuppli has also mentioned automotive as a key area for MEMS. What kind of growth does it see for automotive?

Bouchaud adds that automotive will grow at 8 percent CAGR to reach $2.1 billion in 2012, up from 1,3 billion in 2006. The market is largely driven by mandates for tire pressure monitoring, electronic stability control systems and reduced emissions, accelerating growth for pressure and inertial sensors.

So, will “new players have a chance to address a relatively open market”, and if yes, what would those markets be?

Bouchaud indicates that the consumer electronics market is more open than the automotive sector, which features established, long-term supply arrangements, and production cycles lasting five or more years.

CE applications are characterized by fast time-to-market and short product lifetimes. For example, mobile phones that change yearly or even more frequently, and supply agreements satisfied by fast manufacturing ramp-up and ability to meet seasonal demand spikes, and often several suppliers in the same product, (e.g. ST and ADI in Wii). As sensor specifications are more relaxed than automotive, price and footprint are most decisive.

Will there be a growth in dedicated mass production facilities then?

According to him, several large MEMS players, e.g., STMicroelectronics, Freescale and Bosch Sensortec, have or are now invested in upgrading to 8″ production facilities to meet the higher demand from the consumer sector. By 2011, at least 12 companies will operate at this larger wafer size.

“Some companies like Analog Devices are at the limit of their current capacity, due to its strong automotive sensor offering, and has recently decided to work with non-MEMS CMOS foundries like TSMC, a first in the industry. UMC will also join the MEMS community, partnering with Asian Pacific Microsystems,” he says.

And, how would the new entrants be investing in R&D? Will they be doing enough?

The analyst says that R&D rates run high in automotive (12-15 percent of MEMS revenues) and even higher in consumer (can be 15-20 percent). The high R&D rate is needed to sustain leading edge products in fast moving markets. Deep R&D pockets are needed, a luxury that is not available to all.

Elaborating a bit more on the market consolidation, he says: ” Today, the share of the MEM revenues in the hands of the top 30 MEMS companies grew at about the same rate as the market. The markets that drive growth in MEMS are consumer electronics and automotive sensors.

“The sensors will be increasingly commoditized due to extreme price pressure in both sectors, and iSuppli expects the production of MEMS devices for these two markets to be concentrated among fewer companies in the future. One facet is manufacturers attempting economies of scale by combining sales in automotive and consumer areas, e.g. at Bosch, and in future with Freescale and ST.

“Other companies are pioneers and hold a strong market position for a relatively long time. Examples are TI with DLP chips and Knowles with MEMS microphones. We also expect more M&As in the near future to exacerbate the consolidation.”