Consumer Special Purpose Logic IC Market - Growth, Trends, and Forecasts (2022 - 2027)

The Consumer Special Purpose Logic IC Market is expected to witness a CAGR of 6.1% during the forecast period (2022-2027). The growing use of smartphones and tablets in consumer electronics segment is driving up demand for special purpose logic ICs, which is expected to move the global market for consumer special purpose logic ICs forward.

Key Highlights

• Furthermore, demand for low-cost smartphones, combined with increasing Internet penetration, propels the worldwide special purpose logic IC market forward. The global special purpose logic IC market is growing due to the increasing use of logic ICs in industries other than electronics. Leading automotive businesses like Audi and Toyota are progressively requesting and offering electronic devices incorporated into their vehicles, driving the worldwide special purpose logic IC market forward.
• According to Ministry of Economy, Trade and Industry Japan, In 2021, the value of logic integrated circuits (ICs) produced in Japan was estimated to be around JPY 130.5 billion. Metal oxide semiconductor integrated circuits (Logic ICs) are a form of metal oxide semiconductor integrated circuit (MOS IC). This category also includes microcomputers, memory ICs, and miscellaneous MOS ICs, in addition to logic ICs. Such huge production value will create aopportunity for the Special purpose logic IC to grow.
• According to GSMA, the usage of 5G in GCC states will be slightly higher (16% customer 5G adoption) than the global average (15%) by 2025, mainly driven by governments and mobile operators with the support of mobile technology partners.​ Moreover, number of 5G subscriptions is expected to reach 129.62 million in Middle East and North African regions. With the increase in the adoption of 5g the demand for consumer special purpose IC will observe significant growth.
• The COVID-19 pandemic and work from home scenarios have also boosted the demand for certain segments in the consumer electronic market across the globe. In various global markets, demand for PCs and laptops witnessed a significant surge. Furthermore, gaming consoles & devices and fitness consumer devices witnessed record-break sales during the pandemic. For instance, in 2020, lower notebook ASPs were recorded, resulting from higher demand for consumer education PCs globally. Time spent on PCs has increased dramatically across all major usage categories, as well as the number of PCs per household.
• On the flip side, semiconductor fabs require vast amounts of liquid nitrogen to maintain the atmosphere within the facility and within specialisedsealed boxes known as front opening unified pods, or FOUPs, that are used to transport the wafers in order to assure optimal yield in the completed product.​ Further, IC substrate is thin and can easily be deformed, especially in protruding cases, when a board is less than 0.2mm thick. In order to overcome the difficulties, breakthroughs have to be made, in terms of board shrinking, lamination parameters, and layer positioning systems, in order to control substrate warpage and lamination thickness. ​

Key Market Trends

Rapid Advancements in Technology is Expected to Drive the Market's Growth

• The rapid adoption of AR and VR is transforming the gaming industry, creating more opportunities for the XR market. Several companies are making rapid developments in their products and solutions to gain robust market traction. For instance, recently, the Oculus Quest VR headset improvised its VR system by adding a hand tracking feature, which may enable the VR users to use fingers to manipulate the VR worlds.​​
• Gaming, TVs, electronics, kiosks, medical, 3D sculpting, engineering, medical experts, designers, advertisers, and even those with physical limitations are all adopting gesture-based computing. Gesture-based gaming has grown in popularity beyond standard gaming consoles, and it is increasingly being used in instructional games for youngsters. Magic Touch Math, for example, is the first game to focus on teaching arithmetic with unique gesture drawings. As a result, gesture-based recognition can be employed in areas other than traditional gaming.​
• According to a report from Snapchat, by 2025, around 75% of all the global population and almost all of the smartphone users will be frequent AR technology users, out of which more than 1.5 billion users are anticipated to be millennials. According to GSMA's Mobile Economy China 2021, China will be adding around 340 million smartphone connections by 2025, with adoption rising to 9 in 10 connections with 1.5 billion in Mainland China, 12.3 million in Hong Kong, 1.9 million in Macao, and 25.7 million in Taiwan.
• Further, according to Sony, PlayStation 4 consoles worldwide sales reached 115.68 million in June 2021. Moreover, PlayStation 2 had record sales of 157.68 million units worldwide, including over 50 million units in North America and Europe, making it the most popular video game console globally.
• OLED technology holds the promise of significantly enhanced picture quality, with the potential for innovative new consumer display presentations. It is often hailed as the future of digital displays and screens. For instance, in April 2022, LG Business Solutions has launched and installed a video "Wave Wall" with multiple curved OLED displays to form a high-definition surface at the AVI-SPL office in Dallas. The video wall features a 65-inch LG interactive digital signage board that provides wayfinding information. The continuous advancements in technology coupled with the increasing penetration of consumer electronics is likely to drive the growth of the studied market.
• According to a survey conducted by Organisation for Economic Co-operation and Development, by 2025, the number of households having a computer is expected to increase to 1,262.47 million. Homes with at least one computer are referred to as computer households. Such huge increase in the computer adoption will create aopportunity for the market players to expand their standard logic IC product portfolio and expand their presence in different regions and increase their market share.

The Asia Pacific Region is Expected to Witness a High Market Growth

• According to National Bureau of Statistics of China, China produced approximately 32.66 million completed computers in April 2022. Furthermore, according to Ministry of Electronics and Information Technology The value of computer hardware output in India was roughly INR 215 billion in fiscal year 2020. In fiscal year 2021, this is expected to rise to INR 220 billion . The value of computer hardware produced in the country has been steadily increasing.Such huge spending on the computer production will create an opportunity for the local computer and consumer special purpose logic IC manufacturers to expand their product portfolio.
• Emerging nations, such as India, have witnessed a decline in data costs since 2013. This has increased the number of smartphone users. According to ASSOCHAM, the number of smartphone users in the country is anticipated to double from around 468 million in 2017 to 859 million by 2022, registering a CAGR of 12.9%.
• Also, as of May 2021, Google announced that it is engaging closely with its partner Reliance Jio on the initiative of creating an affordable smartphone and the work is underway on the project. The company previously picked up a 7.7% stake in Jio Platforms for INR 33,737 crore in 2020 and had also entered into a commercial agreement with the Jio Platforms to jointly develop an entry-level, affordable smartphone. Product developments like these will create aopportunity for the studied market to grow and the enable the companies to expand their market share.
• Japan aims to attract overseas companies through financial incentives to secure its chip supplies and address the global shortage. Japan imports significant semiconductors from overseas and wants to build a supply chain of this technology at home. For instance, in June 2021, Japan signed off on a JPY 37-billion semiconductor research project to develop chip technology in the country with TSMC. About 20 Japanese companies, including Hitachi High-Tech Corp., will work with TSMC on the project, with the Japanese government paying just over half of the cost.
• Also, the move of the Indian government by announcing an INR 76,000 crore policy-push for semiconductor and display manufacturing is anticipated to further bolster the growth of the Asian market. The Ministry of Electronics and Information Technology (MeitY) in India started receiving applications from companies to set up manufacturing fabs in India from January 2022. The boost in semiconductor manufacturing ecosystem in the Asia Pacific region is expected to offer lucrative opportunities for the studied market.

Competitive Landscape

The Consumer Special Purpose Logic IC Market is a moderately fragmented market with the presence of significant players like Qualcomm Inc., NXP Semiconductors NV, Texas Instruments Inc., Infenion Technologies, etc. Product innovation, collaborations, and acquisitions are some of the techniques frequently employed by market players. Further, as the IC manufacturing process advances, catering to numerous applications, new industry participants are extending their market presence and expanding their corporate footprint in emerging nations.

• February 2022 - As new geopolitical and technological dynamics alter the global semiconductor business, German and Japanese semiconductor material suppliers are continuing to strengthen their presence in Taiwan. According to the Consulting Director of the Industrial Technology Research Institute (ITRI), as Taiwan Semiconductor Manufacturing Company (TSMC) continues to implement new techniques, Japanese and German factories are seeking to collaborate with TSMC in order to improve their own competitive position in the industry.
• December 2021- Samsung Electronics Co Ltd announced the merger of its mobile and consumer electronics divisions and the appointment of new co-CEOs in its significant reorganization since 2017 to streamline its structure and focus on increasing its logic chip business. In the July-September quarter, the mobile industry had an operating profit of JPY 3.36 trillion (USD 2.84 billion), compared to JPY 760 billion in consumer electronics.

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