Market Trends of Advanced Packaging Industry
Embedded Die to Witness Significant Growth Rate
- The growth of global embedded die packaging technology is majorly driven by the increasing demand for 5G network technology and consumer electronics. Numerous consumer electronic devices, such as smartphones, laptops, tablets, and portable gaming consoles, incorporate several embedded chips to provide a better user interface and enhanced overall performance. In smartphones, wearable devices, and other consumer electronic appliances, these chips are used primarily in DC-DC converters, power electronic circuitry, and camera circuits.
- Moreover, due to the incorporation of 5G into their architecture, embedded devices used in smart video surveillance systems of automobiles give rapid response times. There is also a critical need for circuit miniaturization in microelectronic devices. Embedded die packaging is a promising technology for emerging microwave applications, owing to its excellent electrical performance at high frequencies. With the reduction in size of electronic devices for ease of access for users, the demand for compact electronic circuitry is on the rise. This demand is met by embedded die packaging technology, which offers advantages such as increased functionality and efficiency of the electronic circuit; reduced size, signal inductance, and power inductance; improved reliability; and higher signal density.
- The increasing adoption of 5G networks would augment the development of the studied market. For instance, according to Ericsson, 5G subscriptions are forecasted to increase drastically worldwide from 2019 to 2028, from over 12 million to over 4.5 billion subscriptions, respectively. Southeast Asia, Northeast Asia, Nepal, India, and Bhutan are expected to have the most subscriptions by region.
- Also, the rollout of 5G technology requires compact and efficient devices to accommodate complex communication systems. Advanced packaging solutions like Wafer Level Chip Scale Package (WLCSP) and fan-out packaging enable smaller form factors, lower power consumption, and enhanced thermal management, making them suitable for 5G devices.
- Furthermore, 3D packaging with embedded die solutions is gaining attention among consumers as an integration tool for next-generation devices, which is likely to become a key trend in the future. Hence, it is anticipated to drive the market over the forecast period.
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Asia Pacific is Expected to Witness Significant Growth Rate
- The Asia Pacific region is anticipated to emerge as a dominant player in the semiconductor packaging market, owing to the presence of major semiconductor manufacturers, rapid industrialization, and a vast consumer electronics market. The region is renowned for its high-volume production of semiconductors and the adoption of advanced packaging technologies across diverse industries, such as consumer electronics, automotive, and telecommunications. These factors are expected to fuel the growth of the semiconductor packaging market in the Asia Pacific region, thereby presenting lucrative opportunities for market players.
- China has a highly ambitious semiconductor agenda, supported by a substantial funding of USD 150 billion. The nation is developing its domestic IC industry to increase its chip production. The Greater China region, comprising Hong Kong, China, and Taiwan, is a significant geopolitical hotspot. The ongoing US-China trade war has further intensified tensions in this area, which houses all the leading process technology, prompting several Chinese firms to invest in their semiconductor industry.
- For instance, in September 2023, China announced its plans to launch a new state-backed investment fund to raise about USD 40 billion for its semiconductor sector. In December 2022, China announced its commitment to a support package exceeding YUAN 1 trillion (USD 143 billion) for its semiconductor industry. This initiative is a crucial step towards achieving self-sufficiency in chip production and is a response to U.S. actions aimed at hindering China's technological progress. The demand for packaging services is anticipated to rise considerably over the forecasted period, owing to the region's intensified efforts to enhance domestic chip manufacturing.
- Regarding investments from private players, the country has been at the forefront for many such announcements, especially toward evolving packaging technologies, thus presenting it as a major competitor for all national geographies working towards expanding its semiconductor industry. For instance, in August 2023, the National Natural Science Foundation of China (NSFC) announced an investment of USD 6.4 million in 30 Chiplet projects, now considered the next big advanced packaging technology.
- Moreover, in August 2023, Taiwan Semiconductor Manufacturing Company (TSMC) announced investing 90 billion New Taiwan dollars to build an advanced chip packaging plant in Taiwan amid booming global demand. Additionally, Micron stated in June 2023 that it would spend millions of dollars on a factory in China despite the Chinese government having just deemed its goods a security risk. Over the coming years, Micron stated it will upgrade its chip packaging factory in Xi'an with investments totaling YUAN 4.3 billion (slightly over USD 600 million).
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