IOT, smart home and automotive, a safer zone for semiconductor industry
After seeing 3 decades of near non-stop growth from 1980s to 2010, personal computer market not able to lift up (in growth) nearly from past 2 years. When it comes to mobile phone/smart phone, it is still growing, but the fears of slow growth already becoming true. Both the PC and mobile phone market are extremely competitive, if you get in right, you can see huge growth, if you'r not that's going to be very risky. The equally risky market but presently fast growing one is, the wearable market.
For those who stayed away from (or failed in) PC and smart phone market, the three important markets have emerged as great opportunity now. They are IOT enabled electronic devices used for personal, industrial, or any such purposes. The top two markets now are smart home and the automotive market. Medical electronics can be hesitantly added to this. The smart home and also automotive market requires not just a processor or a SOC but a range of semiconductor ICs including lot of sensors. Though application-wise they might be vertical but the technology wise they are quite broad. It is tough for the overnight vertical IP experts to serve this market. It requires long-term experience and also broader expertise in the semiconductor and electronics domain to serve these markets of smart home, industrial, automotive and medical.
The flexibility in the silicon offering is a key differentiator in all these markets. A 8-bit microcontroller to a 64-bit SOC required for different applications in automotives and also in smart homes. A lot of analog integrated circuits required at various levels. You definitely need different power architectures based on the DC power and AC power requirements of many systems in smart home as well as automotives. There is a lot of innovation happening in discrete power semiconductor devices. All these electronic systems will be connected to Internet through an IOT supporting communication interface, again that requires lot of wireless and RF, wireline communication expertise. Unlike PC, the centrepiece is no more a processor in smart home and automotive. IOT is enabler here, but not really the centrepiece. Safety security and reliability of the systems may be the centrepiece here.
If you're a mobile phone SOC vendor and have some experience in wireless, your expertise seems only one third of the required. For mobile phone or PC focused companies getting into power semiconductor, analog, and sensor market can only happen through acquisitions. And acquisitions cannot guarantee success.
The companies such as NXP Semiconductors, STMicroelectronics, Texas Instruments, Infineon, Toshiba are very well positioned to serve these markets. Companies such as these can be called as all-weather withstanders.