Apple in 2010 rose one rank to become the world's second largest buyer of MEMS sensors for consumer electronics products and cell phones, as it snapped up parts for products including the iPhone 4 and iPod Touch, new IHS iSuppli research indicates. The company's purchases of consumer and cell phone MEMS sensors rose by 116.7 percent in 2010, the highest rate of any major buyer. Apple's purchases rose to $195 million in 2010, up from $90 million in 2009. This strong increase propelled Apple past Nintendo. Apple in 2010 also came very close to taking the No. 1 spot, trailing leading purchaser Samsung Electronics by just $5 million.
MEMS differentiate Apple products
"Consumers in 2010 happily bought up Apple products including the iPhone 4, the iPad and iPod Touch," noted Jérémie Bouchaud, principal analyst for MEMS at iSuppli. "Much of the appeal of these products lies in their sophisticated user interfaces, which rely heavily on MEMS sensors, specifically accelerometers, gyroscopes and microphones. This caused Apple’s purchasing to boom in 2010."
MEMS sensors bought by Apple last year included 3-axis gyroscopes from STMicroelectronics for the iPhone 4, iPod Touch, and -- toward the end of 2010 -- the iPad 2 tablet. Apple also bought accelerometers for the above three devices as well as for the iPod nano and MacBook computer. Furthermore, the company procured bulk acoustic wave (BAW) duplexers from TriQuint Semiconductor for the iPhone and iPad 3G. Analog Devices, Knowles Electronics and AAC -- using die from Infineon Technologies -- provided Apple with MEMS microphones for the iPod nano 5th Generation, iPhone 4 and Apple headsets and the iPad 2.
Apple's MEMS influence
While Apple's procurement activities are extensive, the company's influence on the MEMS sensor market transcends its own purchasing.
"Apple is responsible for creating new MEMS markets for consumer electronics and cell phones far beyond its own consumption," Bouchaud said.
The first iPhone made it popular for handsets to use accelerometers -- devices that provide auto-screen rotation and gesture-based command functions. The iPhone 4 also employed gaming-helpful gyroscopes. Likewise, the MEMS industry owes a tremendous debt of gratitude to Apple for single-handedly reviving the tablet, a hotbed market for MEMS projected to be worth more than $200 million by 2015.
Samsung surges to No. 1
Samsung in 2010 recaptured the top spot from Nintendo as the largest buyer of MEMS sensors for mobile phones and other consumer electronics like tablets. The company’' purchases rose 46 percent from $195 million in 2010, allowing it to surpass Nintendo to take the No. 1 spot. Samsung had been the market leader in 2008.
Samsung's shopping bag included BAW filters from Avago Technologies and TriQuint, followed by accelerometers from Bosch Sensortec, Kionix and STMicroelectronics.
Other important MEMS items purchased by Samsung last year included microphones from Knowles, gyroscopes from STMicroelectronics, and Digital Light Processing (DLP) chips for pico projectors from Texas Instruments.
Nintendo falls to third
Nintendo's purchases declined to $123 million in 2010, down 11.5 percent from $139 million in 2009. As a result, the company fell from the top spot in 2009 to third place in 2010.
"Nintendo’s MEMS sensor orders declined primarily because of the market saturation of Wii video game controllers, which use accelerometers," Bouchaud said.
Nintendo MEMS expenditures were for single-axis, dual-axis and three-axis gyroscopes from InvenSense, intended for both the Wii Motion Plus remote controller as well as for Nintendo's newly released 3DS handheld device featuring 3-D gaming. The company also bought single-axis gyroscopes from Epson Toyocom, plus accelerometers from STMicroelectronics and Bosch Sensortec for the Wii and 3DS.
Other MEMS buyers
LG Electronics, staying put in fourth place this year, purchased MEMS mostly for its handsets. The company also obtained BAW filters from Avago; microphones from Knowles; accelerometers from Bosch Sensortec, Kionix, Freescale Semiconductor and STMicroelectronics; and toward the end of the year 3-axis gyroscopes from InvenSense and STMicroelectronics.
Sony's one step move up from sixth rank in 2009 placed it second, after Apple, in yearly MEMS expenditure growth, with revenue of $95 million, up 55.7 percent from $61 million in 2009. Sony bought gyroscopes as the company's highest MEMS spend, sourced from various players and fitted to the Sony Move remote controller for the PlayStation 3 game console.
Suppliers to Sony included STMicroelectronics for single, dual and 3-axis gyroscopes; Sony itself for the dual axis version; and Murata, Epson Toyocom and STMicroelectronics for the single-axis gyroscope in the Dualshock controller for the PlayStation 3. Accelerometers also were needed for the Sony Move and Dualshock from Kionix, with STMicroelectronics serving as a second source.
Global MEMS industry is relatively unaffected from Japan quake aftermath
Nearly two months after the Japan quake and tsunami wreaked havoc on the world's industrial supply chains, the global MEMS industry is back on its feet, emerging relatively unscathed after the disaster, according to new IHS iSuppli research.
"To date, the supply of MEMS sensors and actuators remains only slightly affected by the Japan catastrophe," said Jérémie Bouchaud, director and principal analyst for MEMS at IHS. "In fact, the main effect of the earthquake on the world MEMS industry is on the demand side, not on supply. Manufacturers of finished electronic products have been more severely impacted than the component suppliers."
MEMS devices are used in popular consumer electronic products like smart phones and tablets, and MEMS sensors also find their way into applications for the industrial, automotive, medical and aerospace sectors. Given that nine out of the top 50 MEMS manufacturers worldwide are Japanese companies, and with Japan serving as a strong manufacturing base for MEMS companies headquartered in Western countries, the world's third-largest economy occupies a central position in the production and supply of MEMS.
Japanese companies sold some $1.38 billion worth of MEMS in 2010, representing 21.3 percent of the global market. Japanese firms Canon, Panasonic, Epson and Denso all rank among the Top 20 in the global MEMS space.
Approximately 32.5 percent of MEMS sensors and actuators in value were processed -- either partly or entirely -- in Japanese facilities in 2010, corresponding to revenues from both Japanese MEMS companies and from foreign companies that have their MEMS processed in Japan. Western companies with MEMS facilities in Japan include Freescale Semiconductor, Knowles Electronics, Goodrich and Texas Instruments for the CMOS circuitry of its Digital Light Processing (DLP) chipsets.
Furthermore, Japan makes nearly all of the world's digital compasses. Compasses rapidly are becoming a standard feature in tablets and cell phones equipped with global positioning system (GPS) functionality. Worldwide shipments of digital compasses reached 263 million units in 2010, up 354 percent from 58 million the earlier year, with shipments expected to rocket to 1.28 billion units by 2015, IHS iSuppli research indicates. Together, four Japanese firms -- AKM Semiconductor, Yamaha Corp., Aichi Steel and Alps Electric -- accounted for 97 percent of the global supply of digital compasses.
For the MEMS industry in general and for Japan's MEMS sector in particular, the damage was not as severe as initially feared due to a fortuitous accident of geography. Most MEMS fabs and foundries are located in southern Honshu, away from the disaster-devastated northern section of the island, Bouchaud pointed out. Moreover, MEMS and compass suppliers had been employing multiple fabrication plants for manufacturing before the quake and tsunami occurred, reducing the impact of supply disruptions caused by damage to a specific factory.
Damage report: only three fabs sustained direct damage
Only three of the 22 most important MEMS and compass fabrication plants in Japan suffered direct damage, IHS iSuppli research shows, although 19 fabs potentially could be affected by the same logistical and power issues impacting all Japanese industries in the calamity's aftermath. The three damaged facilities belonged to Freescale, Canon Corp. and Texas Instruments.
According to Freescale, the company has decided to close its 150-millimeter (mm) fab in Sendai, near the quake's epicenter, and focus efforts on accelerating the transfer of MEMS production to its 200-mm Oak III fab in Texas. Freescale was lucky in that the Sendai fab had been scheduled for shutdown by the end of 2011, and the company already had built buffer inventories. Had it not made this decision in 2009, Freescale and its customers would have been severely hurt, IHS believes.
For Canon, which makes printers and MEMS print heads in the city of Fukushima, site of the nuclear meltdown, production was halted after significant damage to the company's plant. However, Canon managed to repair the damage very quickly, with the plant completely operational again by the first week of April. As a result, the impact of the disaster on Canon's MEMS revenue for 2011 is expected to be very modest, IHS iSuppli data indicate.
For its part, Texas Instruments' Miho fab northeast of Tokyo has undergone the repair of various infrastructure systems for water, gases and chemicals. Full production will resume by the middle of July, with full shipment capacity to commence before September, the company said. Prior to the catastrophe, Texas Instruments already was using multiple fabs for the fabrication of CMOS wafers for DLP MEMS chips, and the company is in a fortunate position to rapidly increase production at its other fabs to compensate for the disruption at Miho.
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