Market Trends of Semiconductor Device Industry In Consumer Industry
Increase Penetration of Smartphones and Smart Wearable Devices
- Due to the increasing population and urbanization, smartphone adoption rates are increasing, particularly in developing countries, which has fueled the demand for the semiconductor device market in the consumer industry. For instance, as per GSMA, by 2025, smartphones are expected to account for four of every five connections, up from 65% in 2019.
- Moreover, as per BankMyCell, as of September 2022, smartphone users worldwide are 6.648 billion, translating to 83.04% of the world's population owning a smartphone. The number of people owning a smart and feature phone is 7.26 billion, making up 91.08% of the world's population.
- Further, the semiconductor device market in the consumer industry will witness high growth due to the growing penetration of 5G technology, which drives the demand for 5G-enabled smartphones. For instance, as per GSMA, by 2025, 5G networks will likely cover one-third of the world's population. In the 5G wireless cellular networks, smartphone battery efficiency and optimal power utilization have emerged as important factors contributing to the growth of semiconductor devices.
- Additionally, several smartphone manufacturers are focusing on launching technologically advanced phones to gain a competitive edge, further supporting the market growth. For instance, in May 2023, Poco announced the launch of Poco F5 in India and global markets. The company is also launching the Poco F5 Pro simultaneously globally.
- Smart wearable devices, such as smartwatches, smart wristbands, fitness trackers, activity trackers, sports watches, and virtual realty (VR) headsets, are integrated with advanced technologies such as artificial intelligence (AI) and the Internet of Things (IoT), which employ a huge number of sensors and integrated circuits (ICs). For instance, fit bits, smartwatches, and pulse oximeters are among the wearable systems incorporated with optical sensors to provide real-time patient health tracking solutions. Therefore, with the increased use of these devices, the overall semiconductor device market in the consumer industry is impacted positively, exhibiting steady growth.
- Many vendors are also focusing on developing new products to meet the growing demands and increase customer base. For instance, in January 2023, 221e srl and STMicroelectronics joined forces to enhance artificial intelligence solutions for wearable, IoT, and other consumer applications based on 221e's sensing AI software and STMicroelectronics's microcontrollers and intelligent sensors.
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Asia-Pacific to Dominate the Market
- The semiconductor device market in the consumer industry is projected to be dominated by Asia-Pacific owing to the presence of leading consumer electronics manufacturers. The market is expected to be driven by increasing smartphone penetration, 5G penetration, and smart home appliances.
- Several global companies see the Asia-Pacific region as one of the key markets likely to generate future growth. The growth of the Asia-Pacific consumer market is mainly driven by favorable demographics and increasing disposable income.
- With the presence of significant manufacturers, the region is among the biggest consumer electronics markets. The demand for the semiconductor devices market in the consumer industry is anticipated to increase as the consumer electronics industry expands in several countries. India, for instance, is one of the major global markets for consumer goods and the newest technology. India Brand Equity Foundation (IBEF) predicted that the market for Indian appliances and consumer electronics (ACE) will grow at a 9% CAGR to reach USD 21.18 billion by 2025. Such numbers are estimated to drive the growth of product launches in the region.
- Moreover, the demand growth for smart homes is expected to be driven by rising energy costs, which has led to the adoption of energy-efficient and cost-saving solutions for thermostats, lighting, and smart outlets. Such an increase in the demand for smart home devices and smart power management devices in the market is expected to fuel the demand growth of the semiconductor device market in the consumer industry in the region.
- Furthermore, major industry players focus on expanding their regional operations to stay ahead of the competition. For instance, in March 2023, Samsung announced to build a new semiconductor facility in South Korea by investing USD 228 billion.
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