Decline of Cellular/3G to Negatively Impact the RF Power Semiconductor Device Market

(Top News, 25 Mar 2008)

The RF power semiconductor device market below 4GHz is composed of six major segments, according to the latest report from ABI Research. These segments are wireless infrastructure, military, ISM (Industrial, Scientific and Medical), broadcast, commercial avionics, and non-cellular communications, with each segment branching out into smaller niches to permit highly specific forecasts for the market.

"Wireless infrastructure represents the largest segment for RF power semiconductors, and it contains the largest sub-segment: cellular/3G," says Lance Wilson, research director. "But cellular/3G is in a sense a long-term market anomaly that is now in a decline, which will continue steadily over the next five years."

More efficient air interfaces, coupled with average selling price (ASP) erosion and the build-out of the infrastructure base, are what drive this sub-segment downward from a revenue standpoint. On the device side, wide-scale adoption of plastic packages diminishes revenue as well; and over the 2007 to 2012 forecast period, revenues for the cellular/3G sub-segment will decline at a compound annual growth rate of nearly 8 percent.

"WiMAX, another sub-segment within wireless infrastructure, remains controversial," explains Wilson. "Although fixed WiMAX is deploying, mobile WiMAX (802.16e) is in a state of flux from a high-power standpoint. There is a potential large upside to mobile WiMAX, but there are no guarantees that this will actually occur in a wide sense. In spite of this possibility, the overall wireless infrastructure segment will decline by a compound annual growth rate of 2 percent over the forecast period."

Overall, the entire marketplace will exhibit a five-year growth rate of only 2.9 percent—illustrating the effect of Cellular/3G's decline. However, the remaining major segments show a healthy compound annual growth rate over the forecast period of 9.5 percent, with the military and ISM segments leading the pack.

Click here for more information on the study "RF Power Semiconductor Devices" by ABI Research