News

14 January 2009

 

Base-station semiconductor market to drop 12.3% per year to 2012

Base-station semiconductor revenue fell from $7.2bn in 2007 to $4.6bn in 2008, and will decline an average of 12.3% per year from 2008-2012, according to market research firm In-Stat in its report ‘A Tough road Ahead for Base Station Components — Worldwide Semiconductor Forecast’. Of the main technology types, WCDMA is the only technology expected to yield semiconductor revenue growth between 2008 and 2012.

There are several reasons for the overall decline. “The number of subscribers in many areas is reaching saturation, with former double-digit subscriber growth now running in the mid-to-low single-digits,” says analyst Allen Nogee.

“The global recession will also have an impact,” he adds. The slowing worldwide economy is having wide-ranging negative effects on all regions, with the possible exception of Africa. “Although most people aren’t likely to part with their cell phones, they may replace them less often, and reduce services they don't find value in or can't afford.”

“Not only are we facing an economic slowdown the likes of which have not been seen in 25 years, but also infrastructure manufacturers are just coming off an unusual infrastructure growth spurt, with operators around the world spending billions on new 3G equipment. Unfortunately, that growth couldn’t go on forever... They are now waiting for service revenues from these networks before they invest more,” continues Nogee. Recession will get operators rethinking their spending plans, it is reckoned.

“Going forward, this will be a tough time for those producing base-station equipment and semiconductors, and the weaker companies, or those poorly positioned, will not likely survive,” concludes In-Stat.

See related items:

Base-station RF component market flat at $1.1bn through 2013

Base-station chip sales to fall slowly over next five years

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Visit: www.instat.com