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World economics keeps chip bubble afloat, says analyst
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EE Times Europe


LONDON — The semiconductor market will grow by 12 percent in 2007 and by a further 16 percent in 2008, according to Malcolm Penn, chief executive of market analysis company Future Horizons (Sevenoaks, England).

As usual Penn found himself at the bullish end of the spectrum of analysts' opinions, which is showing a spread of 5 to 12 percent for 2007 chip market growth.

Penn made his assessment based on the view that there will be a belated return to ASP growth aligned with continuing unit demand over the next couple of years.

However, Penn's analysis is also based on the assumption that there will be no major shocks to the global economy and that price wars among the leading vendors of processors and memory will get no more extreme than they are already.

As the electronics industry has moved from being a low volume, high margin professional proposition to a high volume, low margin consumer one, it has become inextricably linked to the overall global economy, Penn said. Global GDP has shown four years of historically strong growth, despite high oil prices for the last two years, and some economists are predicting a collapse soon. However, other economists see the building of the emerging Asian economies as a stimulus to the world economy in the same way that the rebuilding of Europe and Japan was in the 1950s and 1960s, which produced a prolonged boom.



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Related Links:

  • Future Horizons sees the ASP upside
  • Worrisome trends cloud IC growth forecasts for 2007
  • Semiconductor market growth still undervalued



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