LONDON – Malcolm Penn, founder and principal analyst with consultancy Future Horizons (Sevenoaks, England), sees a return to a "normal" 6 percent growth pattern for the semiconductor market in 2011. This will come after 2010 displays growth of more than 30 percent, as a recovery from a poor 2009.
Speaking at a one-day presentation held here Penn said normal growth corresponds to somewhere between 1.5 percent and 10.5 percent growth. Penn insisted that the visibility into such numbers a year out can never be precise but that the key factors are the trends, from which the general sweep of the numbers can be seen.
Nonetheless Penn was prepared to put his name to 6 percent growth in 2011, but with the caveat that there is plenty of upside to that number. "Just because 6 percent is lower than 34 percent does not mean 2011 is a bust cycle, quite the opposite. [It's] business as usual," said Penn.
The 6 percent figure is a second halving of the 2011 figure by Penn. In July 2010, Penn cut his prediction for 2011 from 28 percent to 14 percent describing the move as a "recalibration" of the speed of the 2009-2010 recovery (see Penn raises 2010 chip market forecast, cuts 2011).
Penn's prediction of 6 percent growth goes along side an estimated 1.5 percent increase in average selling prices (ASPs) for chips. But Penn is a strong advocate that the ASPs falls that dominated the previous decade cannot continue forever. Indeed he states that ASPs have turned a corner and have been rising since 4Q09. Penn conceded that ASPs could rise by more than 1.5 percent in 2011 with a direct impact on the semiconductor market value. "Given the current 2010-11 fab-tight situation the upside for 2011-12 is huge, but there is a memory wildcard, which could take $10 or $15 billion out of the market."
In general memory is expected to see some price attrition and over supply in 2011, but the memory manufacturing capacity operates quite separately to the logic market, said Penn.
Other market watchers are offering a spread of between 2.3 percent offered by Mike Cowan and 10 percent predicted by IC Insights.
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