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Defense spending to buoy compound semicon market

Posted: 21 Dec 2006 ?? ?Print Version ?Bookmark and Share

Keywords:Strategy Analytics?

The market for GaAs and compound semiconductor technologies (GaAs) will continue to grow at a CAGR of 8 percent through 2010, said Strategy Analytics, as defense spending for these products persist. Defense contracts for these applications reached over $16 billion this year, and are projected to expand through 2015.

GaAs, according to the research firm, remains a key ingredient in military and defense systems including radar, communications, electronic warfare and smart munitions.

Strategy Analytics added that emerging compound semiconductor technologies such as GaN will also influence the design of future defense systems, providing wider bandwidth, higher power and higher frequency capabilities.

"We believe GaAs device demand from the defense sector will increase year-on-year by 9 percent in 2006 and continue to grow through 2010," said Asif Anwar, GaAs service director, Strategy Analytics. "However, we believe that the growing power and frequency requirements of defense systems will favor GaN over GaAs as the optimum technology, and therefore predict that GaN will begin to be the underlying technology for military defense systems from 2010 onwards."

Notes Stephen Entwistle, VP of the Strategy Analytics' strategic technologies practice, "The upside for GaAs device manufacturers also working on GaN is that the high power, high frequency capabilities of GaN should allow them to compete in areas that have traditionally been dominated by vacuum tube technology. GaN will thus provide an additional revenue stream, rather than simply offering a means for replacing lost revenues due to GaAs displacement."

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