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Electronics Production | November 22, 2007

Growth of opto-sensor-discrete market<br>to exceed ICs through 2011

Double-digit average annual increase expected for total opto, sensor, discrete market.
The market for optoelectronics, sensors/actuators, and discretes (O-S-D) is often overshadowed by the sheer size of IC revenues, but the market for this diverse group of semiconductors is forecast to outpace integrated circuit sales growth with an annual average increase of nearly 10% per year in the 2006-2011 period compared to about 9% for ICs (Figure 1).

As shown, O-S-D sales totals have been increasing at faster cumulative average growth rates (CAGRs) than ICs since the late 1990s, when optoelectronics provided a strong boost to growth rates, partly due to over investments into fiber-optic networks and high-speed communications during the "Internet boom" period, which eventually went bust in 2001. But other optoelectronics products quickly emerged as growth drivers early this decade, including CMOS image sensors for camera phones and digital still cameras and high-brightness white light-emitting diodes (LEDs) for backlighting of keypads and color displays in cell phones and other portable products. The markets for optoelectronics and discretes are now nearly equal in size and have been for several years, but opto semiconductor revenues are expected to finally pull ahead of discretes for the first time in history at the end of this decade.

In today's semiconductor business, the sale of optoelectronics, solid-state sensors and actuators, and discrete devices accounts for a little more than 15% of worldwide revenues. Integrated circuits are expected to take 85% of the $258.1 billion total semiconductor market in 2007, based on IC Insights' latest projections.

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