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iPad will drive tablets to become fourth largest semiconductor market

Will take fourth spot in 2014, after being only 35th in 2010

Tablet PCs will be the fourth largest global market for semiconductors by 2014, driven by strong sales of Apple's iPad, market research firm IHS predicts.

Back in 2010 tablet PCs were only the 35th largest market for semiconductors, but the IHS iSuppli Application Market Forecast Tool shows that sales of semiconductors for use in media tablets will climb to $18.2bn in 2014, up from $2.6bn in 2010.

In 2011, media tablets were the eight largest market for semiconductors and it is predicted that they will climb the list to fifth this year.

Meanwhile, mobile handsets will become the world's largest semiconductor application in 2012, for the first time ever exceeding mobile PCs as the leading chip segment, IHS said.

"The speed of the media tablet's rise from near insignificance to top-tier prominence is unprecedented in the history of the global semiconductor industry," said Dale Ford, head of electronics & semiconductor research for IHS.

"Driven primarily by Apple's iPad, the media tablet in four years is expected to scale semiconductor heights that took more than a decade for other products to attain, such as notebook PCs and cellphones. This meteoric ascension will have major repercussions for the global semiconductor industry, as it realigns to accommodate the fast growth and vast size of the media tablet market."

IHS predicts that the semiconductor market will go through a period of change as new suppliers look to muscle in on the new opportunities presented by the rapid growth in tablet sales.

"The rise of specific applications has led to the creation of semiconductor powerhouses in the pastsuch as the PC microprocessor colossus of Intel Corp. or the cellphone chipset juggernaut of Qualcomm Inc. However, media tablets will generate semiconductor demand that is much more broadly diversified, spreading the opportunity among a wider set of suppliers than previous platforms did."

Makers of NAND flash and DRAM, wireless integrated circuits, image sensors, microelectromechanical sensors, LEDs and power management ICs will be among those that benefit, IHS said.

"While there will be a handful of suppliers that will stand out as the leading suppliers of semiconductors for media tablets, there are many component markets that represent highly attractive opportunities for a diverse group of suppliers. Interestingly enough, media tablets and handsets are a key driving force in reducing some of the consolidation in the semiconductor industry that has developed in more mature markets like PCs."

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