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Top 3 Emerging Trends to Impact the Semiconductor Advanced Packaging Market in the Next Five Years: Technavio
[August 14, 2017]

Top 3 Emerging Trends to Impact the Semiconductor Advanced Packaging Market in the Next Five Years: Technavio


Technavio's latest report on the global semiconductor advanced packaging market provides an analysis of the most important trends expected to impact the market outlook from 2017-2021. Technavio defines an emerging trend as a factor that has the potential to significantly impact the market and contribute to its growth or decline.

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Technavio has published a new report on the global semiconductor advanced packaging market from 2017 ...

Technavio has published a new report on the global semiconductor advanced packaging market from 2017-2021. (Graphic: Business Wire)

Packaging is a process in the semiconductor development cycle that involves the wrapping of the silicon wafer in a case. This case offers support and protection from physical damage as well as prevents the corrosion of the chip. Semiconductor packaging, over the last ten years, has evolved from chip-scale package to SiP, PoP, wafer-level package, 2.5D ICs, and finally to 3D ICs. The packaging market faces challenges in wafer size and node migrations. This slows down market growth, even though the overall capital expenditure by vendors is increasing.

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The top three emerging trends driving the global semiconductor advanced packaging market according to Technavio hardware and semicondctor research analysts are:



  • Changes in wafer size
  • Integration of semiconductor components in vehicles
  • Increase in number of M&A

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Changes in wafer size

"The semiconductor industry has seen a drastic transition in wafer size over the last five decades. The industry is focusing on producing larger diameter wafers, which is expected to cut down the manufacturing cost by 20%-25%. As of 2016, the semiconductor industry is using 300-mm wafer, with foundries investing in developing more such fabs. For instance, SK Hynix is building an M14 fab for the 300-mm technology in South Korea," says Sunil Kumar Singh, a lead analyst at Technavio for research on semiconductor equipment.

The demand for 200-mm wafers is also expected to continue during the forecast period because semiconductor devices such as image sensors, microcontrollers, display drivers, and a few MEMS-based products like accelerometers still use 200-mm wafers for manufacturing. The industry is now planning to develop 450-mm wafer technology, with pilot production expected to start during 2019-2020.

Integration of semiconductor components in vehicles

"The electrification of automobiles, as well as the rising demand for automation in vehicles, is driving the semiconductor market in this sector. Semiconductor ICs are being used for several purposes in automobiles, such as airbag control, GPS, anti-lock braking systems, displays, infotainment systems, power doors as well as windows, automated driving, and collision detection technology," adds Sunil.

The need for these semiconductor devices to be of small size and the right form factor will drive the demand for advanced packaging solutions from the automotive sector. The automotive market is expected to grow, driven by the rising yearly car production numbers, generating significant demand for semiconductor devices. This will, indirectly, trigger the demand for advanced packaging solutions during the forecast period.

Increase in number of M&A

The semiconductor packaging market is registering an increase in the number of M&A. The existing vendors are taking the M&A route to increase their market share as well as to enhance their market share. This trend has been a continual one, with other leading players in the global market also investing in M&A.

Amkor (News - Alert) Technologies, for instance, acquired NANIUM, a provider of WLP semiconductor packaging solutions; the agreement was signed in February 2017, and the acquisition is expected to be completed by the end of the year. New entrants in the market also prefer the M&A route to enter the already highly competitive market.

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Technavio is a leading global technology research and advisory company. Their research and analysis focuses on emerging market trends and provides actionable insights to help businesses identify market opportunities and develop effective strategies to optimize their market positions.

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