The top suppliers last year of microelectromechanical systems (MEMS) sensors built their dominance on sales of devices for smartphones and tablets, the pre-eminent electronic gadgets for consumers today and also the main driver in fueling ongoing MEMS market growth, according to an IHS iSuppli MEMS & Sensors report from information and analytics provider IHS.
The five leading manufacturers for the MEMS consumer and mobile market that includes smartphones and tablets claimed a massive 58 percent share of industry revenue in 2012, equivalent to $1.69 billion out of that market's total of $2.92 billion. When extended to include all of the Top 10 suppliers, collective revenue surged to $2.33 billion, or 80 percent of industrywide takings.
French-Italian entity STMicroelectronics was the top player and in a league of its own, with nearly three times more revenue than its closest competitor, Illinois-based Knowles Electronics. Nine of the Top 10 last year each had revenue of more than $100 million, with the 10th-place competitor just narrowly missing the hundred-million mark.
With nearly $3 billion in overall revenue, the consumer and mobile market is far and away the most important segment of the overall MEMS industry, ahead of other MEMS sectors such as automotive, industrial, medical and military/civil aerospace. And the main stars of the consumer and mobile market are smartphones and tablets, accounting for 70 percent of value within the segment. This is because smartphones and tablets are a veritable hotbed for all sorts of MEMS sensors-from mainstays such as accelerometers, gyroscopes and electronic compasses; to newly emerging MEMS products like pressure sensors and MEMS actuators for optics autofocus, MEMS timing devices and thermopiles.
Accelerometers, for instance, are used in mobile handsets and tablets to help orient the devices correctly either horizontally or vertically when held in the hand, while gyroscopes and electronic compasses are invaluable for motion-sensitive applications like gaming and navigation. Given the enormous market of smartphones and tablets, the suppliers of MEMS sensors for the two devices stand to reap massive revenue-or potentially lose out if they miss an important opportunity.
Besides smartphones and tablets, other important devices that make use of MEMS in the consumer and mobile market are laptops including Ultrabooks and PC tablets, gaming consoles and handhelds, projectors and digital still cameras.
STM remains at the top, holding off all others easily
STMicroelectronics was the undisputed champion last year. The No. 1 firm since 2009, STMicroelectronics' growth last year remained strong at 22 percent as revenue rose to $788.1 million, translating into 27 percent of the total market. Gyroscopes and accelerometers were the primary sellers, but the supplier also is enjoying success with a new group of devices that includes electronic compasses, MEMS microphones, used to improve sound and cancel noise in smartphones and tablets; as well pressure sensors, soon to be deployed for indoor navigation to determine on which floor a user is located in a building.
In second place was Knowles with $291.9 million. Knowles still rules the MEMS microphone space, but its share of shipments for the device eroded to 58 percent in 2012, down from 87 percent in 2010. The cause has been a diminution of business with Apple: Knowles is no longer the top volume supplier of MEMS microphones to Apple, falling to No. 2 out of four suppliers, significantly impacting Knowles' revenue in the process. Yet Knowles continues to have the most comprehensive MEMS product portfolio among suppliers and ships to virtually every brand.
Japanese-based AKM was third with $253.8 million and the top supplier of electronic compasses, but revenue was down 2 percent from 2012. AKM dropped the price of electronic compasses to save deteriorating market share in the face of aggressive pricing from hungry newcomers, and the tradeoff was a slight contraction of revenue. The supplier is also under increasing pressure: it does not have a competitive solution to address the fast-growing MEMS combo sensor market, and its rivals claim-at least on paper-an intrinsically superior compass hardware technology that could support new use cases such as location-based services and augmented reality.
At No. 4 was California-based InvenSense, the most successful MEMS startup of all time, with $186.2 million. Although heavily dependent in the past on gaming consoles, the company succeeded in diversifying into smartphones and tablets. InvenSense also leads the way in the integration of MEMS combo sensors, which accounted for almost half of its revenue last year.
Rounding out the Top 5 was Texas Instruments, with revenue flat at $172.8 million. The MEMS actuators that go into the company's digital light processor projector (DLP) technology are used primarily in high-definition projectors for the home theater market, as well as in pico-projectors either as standalone personal projectors or embedded in handsets and portable consumer devices such as digital still cameras. However, pico-projectors have not taken off as expected because they are expensive, and the success of smartphones and tablets with large and high-resolution displays has further dampened pico-projector prospects for consumer applications.
The rest of the Top 10 included, in descending order, Avago Technologies of California, Bosch from Germany, Massachusetts-based Analog Devices, TriQuint Semiconductor of Oregon, and AAC from China.
Although AAC's revenue of $98.2 million meant it was the only one in the Top 10 to score below $100 million, the company outpaced all the others in growth with a blistering 104 percent surge during the past year.