There appears to be no end in sight to the love that consumers have for technology. At least as long as the innovations keep coming. Although the “classics” are having an increasingly difficult time, the semiconductor industry is very pleased.
Following a period of strong sales during Christmas, in a recent report on Germany’s consumer-electronics industry, the gfu (German Association for Consumer and Communications Electronics) forecast total sales of more than EUR 27.6 billion for 2014, an increase of 2.5 percent. That positive trend is expected to continue in 2015, with sales increasing by just less than two percent to more than EUR 28 billion. The use of mobile media—i.e. of smartphones, tablet PCs and notebooks in particular—is expected to account for additional increases.
The (Consumer Electronics Association) CEA is of a similar opinion, but at the global level. It has forecast that sales of consumer electronics will increase by three percent to an all-time high of 223.2 billion dollars this year. When it comes to new technologies such as 3D printers, 4K TVs, smarthome technologies, household robots and wearables, business is expected to double.
Classic consumer electronics fall by the wayside
When it comes to the “classics,” however, business is expected to suffer. According to the latest forecasts by the EITO (European Information Technology Observatory), the market for classic consumer electronics (not including ICT and software) is expected to decline in 2015, with sales probably dropping by 3.3 percent to EUR 10.2 billion. The CEA also expects global TV sales to decrease by 2 percent to 18.3 billion dollars.
Semiconductors used on a broad scale
Sectors with high demand for chips are growing, which is good news for the semiconductor industry. According to a study by IHS, 2014 saw the industry’s best performance in the chip segment since 2010, with global sales of 353.2 billion dollars, an increase of 9.4 percent compared to 2013. During that year, the segments for DRAMs and flash memories grew at a rate of 30 percent, and they still reached 20 percent last year.
That rate of growth is healthy, because it means that growth is on a broad scale. Besides memories, a number of other chip segments are contributing to this success. According to IHS, for instance, the global LED market is expected to have continued its years-long success story again in 2014 with growth of 11 percent. Analog chips, discrete semiconductors and microprocessors experienced a strong turnaround in 2014, and PLDs (programmable logic devices) and DSPs (digital signal processors) are excelling with dramatic surges in growth.
Add to that the fact that, according to an HIS study, semiconductor sales increased in five out of the six most important end markets in 2014, i.e. data processing, wired and wireless communications, automotive electronics and industrial electronics. Classic consumer electronics is the only sector that wasn’t a winner. Certainly, that is also one of the reasons why Japan was the only region that did not participate in the semiconductor market’s growth last year.