EL SEGUNDO, Calif. -- There's good and bad news in the application specific integrated circuit (ASIC) market. The worldwide ASIC market will fare better than the overall semiconductor industry in 2001, but the business will not enjoy the full benefits of the coming recovery, according to a report from iSuppli Corp. here today.
Worldwide ASIC revenues will decline by 22% in 2001, compared to a 28% decrease in overall semiconductor revenue for the year, said Jordan Selburn, who tracks the industry for the El Segundo-based company.
Beyond 2001, the iSuppli analyst forecasts a slower rebound for ASIC revenues than for the semiconductor market as a whole. There will be a small increase in ASIC demand before the summer of 2002, and a mild but steady increases ASIC revenue the following year--with a compound growth rate of just over 10% from 2003 through 2005, he said.
"ASIC technology will continue to lead the semiconductor industry," he said. "However, the current slowdown in ASIC strongholds, such as data processing, the Internet infrastructure and other communications applications, will have a depressing effect on shipment of these devices for some quarters to come," he said.
There's more bad news. "Historically, the electronics industry has designed its way out of a recession, with ASICs as the core component. In the future, ASICs will continue to be the key to next generation systems," Selburn noted. "However, a number of factors are working to limit ASICs' role, with competing device,design and fabrication models becoming ever more feasible."
On the positive side, there are some new and emerging ASIC-like products that will boost the industry. "At the same time, competition from alternative products like application specific standard products (ASSPs), and programmable logic devices will become increasingly apparent," he said.