MEMS for the Masses
The field of MEMS is broad, encompassing a wide variety of devices used in a large number of applications and designed/manufactured by a very diverse group of companies. Yet some underlying trends are clearly apparent. The growing importance of the consumer market is causing the movement toward integrated or monolithic device design and a changing competitive landscape, including greater involvement by traditional IC manufacturers, the increased adoption of the fabless business model and the move to 8-inch wafers.
Overall growth outlook is positive for most categories of MEMS, particularly those destined for new consumer applications, such as accelerometers, micro displays, silicon microphones and gyroscopes (Table 2.3). Taken as a whole, MEMS devices are forecast to enjoy a 13% compound annual growth rate (CAGR) through 2011 when the total market size will be nearly $11 billion. Over the next three years consumer applications are expected to grow faster than automotive, industrial and medical markets for MEMS.
The consumer market is highly price-elastic, resulting in significant pressure for device manufacturers to reduce costs. One way to accomplish this while at the same time moving up the value chain is to develop integrated “system in package” offerings. An example is the inertial measurement unit or IMU, which may involve three accelerometers (one for each axis) packaged along with three gyroscopes (one for each axis) and the corresponding drive electronics. Development of this type of solution is already underway for automotive applications, and will be very important for consumer applications where real estate is at a premium yet complex functionality is required.
In another strategy to reduce costs, many new start-up companies now follow a “fab-light” strategy and rely on the existing MEMS or semiconductor manufacturing infrastructure. This is driving evolution in the industry, especially increased outsourcing, growing involvement of IC manufacturers (such as STMicroelectronics, Analog Devices and Texas Instruments), and the rapid growth of MEMS foundries and contract manufacturers. With high-volume production required for new applications in cell phones, gaming devices and other portable electronics, MEMS is finally a large enough target for more established companies.
The MEMS industry is still highly fragmented with a large number of device manufacturers worldwide in a wide variety of application fields. Many start-ups and small and medium-sized companies participate in the industry, but as interest grows from larger companies, there will be consolidation through mergers and acquisitions.
The overall growth of the MEMS market along with the growing convergence with semiconductor processing and greater involvement of IC companies is creating additional opportunities for equipment and materials suppliers (Tables 2.4 and 2.5). For example, the majority of MEMS devices are built on silicon wafer substrates. Driven by increasing MEMS unit sales and the transition to larger wafer diameters, this market is expected to grow at 13% CAGR to reach $428 million in 2011.
The total worldwide MEMS equipment market is estimated at $646 million in 2006, of which $338 million is equipment used in front-end processing (52%), $203 million for back-end processing (assembly, packaging and test) (31%) and about $105 million is R&D tools (16%). The front-end equipment segment is expected to grow to nearly $550 million by 2011, with a five-year CAGR of 10%. This category of MEMS equipment will represent about 55% of the total equipment market at the end of the forecast period. Assembly/Packaging and test equipment is forecast to reach over $327 million in 2011, which is about one-third of the total equipment market. The assembly/packaging and test tool segment will grow at about a10% CAGR through 2011.
All of the information contained in this article was based was derived from Global MEMS Markets and Opportunities, published July 2007. If you are a SEMI Member and interested in receiving a full copy of the report, visit www.semi.org/mems and select Market Information to download your electronic copy of the 65-page report for FREE..