Market Trends of GaN Semiconductor Devices Industry
Consumer Electronics to Hold Significant Market Share
- A significant advantage of the higher switching frequency capability is that the value, and hence the corresponding size, of capacitors and inductors needs to be considerably smaller. Together with the smaller footprint GaN device requirements, smaller passive components result in a significantly smaller overall size of a converter or drive.Low conduction (Rds-on) losses result in less heat dissipation, requiring thermal management. This makes the solution more energy-efficient and reduces the overall system size further.
- Across end-user industries, the consumer electronics segment is witnessing a significant demand for GaN semiconductor devices due to the increasing demand for smartphones, gaming devices, laptops, and TVs. According to the Consumer Technology Association's one-year industry forecast, the retail revenues for the U.S. consumer technology industry will grow by 2.8% in 2024 to $512 billion, which is $14 billion more from 2023. This signals an uptick in consumer spending on technology products and services.
- According to MeitY (India), in the financial year 2021, the estimated overall production value of the electronics industry was over INR 5.5 trillion (USD 66.45 billion). Mobile phone production was the most valuable sector, with an estimated production value of INR 2.2 trillion (USD 26.58 billion). Other sectors that ranked highly in value were electronic components, consumer electronics, and industrial electronics.
- GaN is a new production semiconductor expected to replace silicon in many applications in the coming years, and battery charging is the first high-volume market to demonstrate such adoption. GaN (gallium nitride) has superior performance compared to silicon at very high voltages, temperatures, and switching frequencies, thus allowing a significantly higher energy efficiency. With many chargers and GaN adapters ranging from 27W to 300W in mass production, powering everything from mobile phones to drones, the mobile charger market is set to change dramatically.
- Moreover, technological advancements, such as 5G standards, are driving the demand for high-power transistors and base stations, augmenting the demand for GaN power semiconductors in the consumer electronics segment. Many vendors work together and form partnerships with industries that use their products, like consumer electronics, to grow their market share.
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North America to Witness Significant Growth
- Recently, the North American region has been the primary adopter of the semiconductor industry's new design, manufacturing, and research technologies. The growth of the RF GaN market in North America strongly correlates with the development of end-user industries such as telecom, aerospace and defense, consumer electronics, and others.
- Also, according to the Semiconductor Industry Association, since the CHIPS Act was introduced, 67 new projects and expansions of existing US facilities were announced in the US in research and development, intellectual property, chip design, semiconductor fabrication and manufacturing equipment, supplies, and materials totaling well over $200 billion in private investments. These initiatives will contribute to strengthening the domestic semiconductor ecosystem in the US.
- The United States has also pioneered advanced technology for military applications. Also, the country has the highest military spending globally, which is significantly higher than the next five countries combined, making it a lucrative end-user industry for the RF GaN market.
- In the United States, most demand for chips includes large PCs, information and communications infrastructure (including data centers and network equipment), application markets, industrial equipment, and smartphones. TSMC's customers include prominent smartphone manufacturers from the United States, such as Apple.
- In Feb 2024, the U.S. government announced its plan to spend $11 billion on semiconductor-related research and development and launch the $5 billion National Semiconductor Technology Center.
- Also, in August 2022, the US Congress approved the landmark Chips and Science Act. This law provides that $52.7 billion, including $39 billion in subsidies for semiconductor production and $11 billion research and development. It also creates a 25% investment tax credit for building chip plants, estimated to be worth $24 billion.
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