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IC sales for IoT is expected to grow more than three times faster than the total IC revenues in the last half of this decade, according to IC Insights’ new 2017 Integrated Circuit Market Drivers report. The total IC market is expected to grow 4.3 percent over the forecast period of 2015 to 2020, reaching $354.7 billion, up from $287.1 billion in 2015.
ICs for IoT applications is forecast to reach $12.8 billion in 2016, growing at a compound annual growth rate (CAGR) of 13.3 percent over the forecast period, and increasing nearly 19 percent compared to 2015. This is followed by automotive IC sales, which is forecast to grow at a CAGR of 10.3 percent, and increasing about 12 percent to $22.9 billion in 2016, compared to last year.
The automotive electronic systems segment is expected to show the strongest cumulative CAGR through 2020, at 4.9 percent, which is pegged as the highest rate among six main electronic system categories, including communications, consumer, computer, government/military, as well as industrial/medical/other.
“Although the automotive segment is forecast to be the fastest growing electronic system market through 2020,” said IC Insights, “its share of the total IC market was only 7.9 percent in 2016 and is forecast to remain less than 10 percent throughout the forecast period.”
Other market growth drivers include medical (7.3% CAGR), digital TVs (5.9% CAGR), and server computers (5.4% CAGR). The medical IC market is forecast to grow nine percent in 2016, compared to last year, reaching $4.9 billion, while digital TV systems is expected to grow four percent in 2016, reaching $12.9 billion.
The report also finds that IC sales for cellphones, the biggest end-use market for ICs, will grow by a CAGR of 4.8 percent over the forecast period. IC Insights attributes the low growth to
“saturation in smartphone markets and economic weakness in some developing regions.” IC sales for cellphones will only grow two percent in 2016, reaching $74.2 billion.
Weak or negative IC sales are forecast for several markets in 2016 including standard personal computers, set-top boxes, touchscreen tablets, and video game consoles. IC Insights estimates IC sales growth of about three percent in server computers, reaching $15.1 billion in 2016, and only two percent growth for set-top boxes, reaching $5.7 billion.
Negative IC growth is expected in standard PC, video game console and tablet markets, according to IC Insights. IC sales for standard PCs is expected to decrease by five percent in 2016 to $54.6 billion, and video game console IC revenues will drop by four percent to $8.9 billion. Tablet IC sales are forecast to fall by 10 percent to $12.1 billion in 2016.