PHOENIX Semico Research Corp. Wednesday (July 21) said that its Inflection Point Indicator (IPI) declined from the previous month, signaling an impending slowdown in 2005.
The decline in this month's IPI is the first real evidence the market will experience a downturn beginning in early 2005. As previously reported, the Phoenix-based research firm forecasts worldwide revenues will increase by 33.8 percent this year, reaching $222.6 billion. In line with the IPI prediction of a slowdown, Semico forecasts the market will decline 6.8 percent in revenue (see July 15 story).
"The 2004 semiconductor market conditions are very similar to what occurred in 2000," said Jim Feldhan, president of Semico. "Both 2000 and 2004 are characterized by strong GDP growth, an election year, and upgrades and growth in the cellular phone market. New cellular subscribers, smart phones, and camera phones are a key factor in driving semiconductor demand," Feldhan said.
In 1999 and 2000, total worldwide semiconductor revenue shipments increased 18.9 percent and 36.8 percent, respectively. Similarly, the market increased by 18.4 percent in 2003, and is forecast to grow between 34-to-39 percent in 2004.