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Semiconductor spending to hit 8% growth

Posted: 31 Jan 2007 ?? ?Print Version ?Bookmark and Share

Keywords:consumer electronics? iSuppli? MP3 player?

Semiconductor spending by OEMs will grow 8.6 percent this year, with the rise driven by a slew of consumer electronics products, reports iSuppli Corp.

The research firm also cited factors impacting semiconductor buying which include the rising consumption of notebook PCs, the increasing integration of multimedia features in mobile phones, the entrance of new companies into the MP3 player market and the arrival of new video game consoles.

"iSuppli now examines the spending habits of 181 OEMs, adding 14 new companies that have become big spenders and replacing the nine OEMs that were removed from our examination because of recent mergers and acquisitions," said Min-Sun Moon, analyst for OEM Semiconductor Spending and Design Influence at iSuppli. "Some of the newly-added OEMs are long-time players such as Kingston Technology, while others specialize in newer applications, such as TomTom."

The United States will still lead in electronic equipment design activity that influences chip spending, notes iSuppli. It is projected to spend $68.7 billion in design-inspired chip purchasing this year, up 9 percent from $63.1 billion last year. Japan comes next, with a projected spending of $44.1 billion in 2007, up 4.7 percent from $42.1 billion in 2006.

However, countries in Eastern Europe have also experienced growth. According to the research firm, these nations are willing to give assistance to companies that eye investments in the region. For example, the government of Poland has made efforts to attract foreign investment by offering benefits on land, taxes and labor. Delphi and the Bosch Group have recently invested in R&D centers in the country for the expansion of their automotive electronics businesses.

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