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Compound semiconductor materials market reach $1B in '02

Posted: 28 Jan 2003 ?? ?Print Version ?Bookmark and Share

Keywords:laser diodes? LEDs? ICs? substrate wafers? compound semiconductor?

The global market for compound semiconductor-based devices such as laser diodes, LEDs, and ICs, reached $1.1 billion in 2002, according to a study titled "The Global Outlook for Chemicals and Materials in Compound Semiconductors, 2002-2007" recently published by Kline & Co. Inc.

The Kline study, which details and breaks down the materials based on the following classifications: substrate wafers, epitaxial wafers; MOCVD, MBE, and metallization precursors; and ancillaries, which includes photoresists, etchants, and cleaners. Overall, Kline projects the global market for these materials to double from $1.1 billion to $2.2 billion, over the next five years.

According to Michael Corbett, director of Kline's Electronic Chemicals and Materials Practice, the continued rapid growth of this industry sector and the need for high- value-added chemicals and materials are forcing many companies to reevaluate their market strategies in this industry. "This market is much more than a niche opportunity and several companies are actively pursuing aggressive growth strategies here, "Corbett says.

Corbett adds that many suppliers of chemicals and materials to the compound semiconductor industry who are also major suppliers to the CMOS semiconductor industry, feel that they can take lessons learned in CMOS and apply them here to develop new business models to better meet customer needs.

Growth for compound semiconductors will continue to be fueled by their continued use in mobile wireless communications, the consulting firms states, especially for power amplifiers in handsets such as cellular telephones, pagers, and global positioning systems. Superior performance in photonics is said to explain most of the excitement over the future of compound semiconductors.

The market for laser diodes and high-brightness LEDs appear favorable in the short term as new products are developed for outdoor signage, optical storage, automobiles, and new lighting systems, Kline says. On the other hand, in the medium term, the market for infrared lasers and detectors is likely to show significant growth from a base that has been severely depressed by overstocking and low demand.

In the long term, there is a possibility that LEDs will become commonplace as substitutes for indoor lighting. If this happens, sales are expected to skyrocket, but the cost of making LEDs from compound semiconductors would have to come down significantly, Kline explains.





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