El Segundo, Calif. — It is no surprise that Apple and Samsung once again are ranked as the world’s largest buyers of semiconductor chips in 2013, according to a new report from IHS Technology. Together, the two OEMs tallied about 14 percent of total spending in 2013, which was well ahead of other top chip buyers.
The report, “Wireless and Industrial Boost Semiconductor Spending,” finds that the total served available market (SAM) for semiconductor spending reached $237.2 billion in 2013, up nearly 5 percent. This follows a drop in spending from $231.7 billion in 2011 to $226.7 billion in 2012. "The SAM metric counts only expenditures that an OEM made as an external agent, which gives a truer picture of the state of chip spending in the electronics industry," said IHS. SAM doesn't factor in chip spending by manufacturers done at their own internal divisions.
Rounding out the Top 5 big spenders of semiconductors are Hewlett-Packard at No. 3 with $10.1 billion in spending; Lenovo at No. 4 with $9.2 billion; and Dell at No. 5 with $7.7 billion. Cisco Systems, Sony, Huawei Technologies, Panasonic and Toshiba round out the top 10 spenders.
“As in 2012, Apple and Samsung were the top semiconductor spenders in 2013 among original equipment manufacturers (OEM) making more than $1 billion in revenue,” said Myson Robles-Bruce, senior analyst for semiconductor spend and design analysis at IHS, in a statement. “Apple was in first place with chip spending in 2013 of $30.3 billion, outspending runner-up Samsung’s $22.2 billion by more than $8 billion. However, the South Korean electronics titan attained the largest spending increase on chips of any Top 10 OEM last year, up almost 30 percent from 2012 levels, compared to a smaller expansion of 17 percent on the part of Apple.”
Clearly, in the consumer market Apple and Samsung will continue their rivalry. However, Apple is going to have a tougher time holding ground against competitors, "including a well-armed Samsung," stated Robles-Bruce.
One of the biggest factors that could impact Apple is Samsung's intention to use flexible active-matrix organic light-emitting diode (AMOLED) display technology, which could be a future differentiator from products made by Apple, according to Robles-Bruce. "If OLED technology catches on with consumers, Apple could start to suffer, which would be reflected in the California maker’s prodigious chip-buying powers," he added.
Out of seven different application categories covered in the report, spending on wireless ICs was the largest. Wireless gobbled up nearly one-third of total OEM chip spending at 31 percent. Chip spending on computer platforms ranked No. 2 with 22 percent share, and consumer devices at 16 percent. The other four categories -- industrial, automotive, wired communications and computer peripherals -- all ranked single-digit shares in total OEM chip spending.
Not surprisingly, the report finds the top OEM buyers in the wireless segment were Apple, Samsung, Huawei, ZTE and LG. IHS reports this is the first time that spending on tablets overtook wireless infrastructure. However, these markets still lagged behind handsets, which ranked No. 1 in OEM chip spending in the wireless segment.
Wireless was also the fastest-growing application segment this year, up 20 percent, said IHS. Industrial electronics placed second, up seven percent.