Electronic Component Market Trends
December 31, 1969 |Estimated reading time: 7 minutes
Growth in the world electronic components and packaging market depends on the growth of end-user industries, such as computers, telecommunications, consumer electronics and automotive markets. Electronic components are one of the driving factors to help reduce overall size of end products such as PDAs and mobile phones.
By Keith Robinson
Spending patterns of end users have come down drastically, reflected in reduced demand from consumer electronics end-user industries because of weak economic conditions. However, signs of recovery are beginning to appear in the electronics industry, and the electronic component industry is expected to grow with the expansion of the total semiconductor market. The electronic components and packaging segment of the industry describes a wide range of components and packages.
The computing, telecommunications and consumer electronics industries are expected to merge to drive development of next-generation electronic devices, a prime example being merging of mobile phones and other consumer attributes. With the convergence of products EMS providers also will need to be more flexible in their design capabilities.
Technologies are converging to increase efficiency while maintaining low cost, which is driving revenue growth of the overall market for electronic components. Re-duction of operational costs and time, as well as improved quality are driving investment into areas such as research and development (R&D). The result is that manufacturers of electronic components are benefiting from growth in the larger electronics industry.
Since the EMS industry has evolved, several OEMs are allowing EMS providers to choose their own preferred vendors for electronic components, who are more aggressive at procuring components at lower prices. This trend has several electronic component manufacturers rethinking their sales strategies as they try to move up on the preferred vendor list for EMS providers. This trend is expected to alter the landscape of the electronic component market and give EMS providers more bargaining power.
Since many electronic components are connected to printed circuit boards (PCB), these components must be as small as possible. Electronic component manufacturers that can shrink the size of their products without diminishing performance are expected to have a competitive advantage over other participants in the market. SMT equipment manufacturers that could handle smaller components first enjoyed increased market share.
The industry is reducing package dimensions of surface mount device (SMD) resistors while maintaining stringent electrical performance characteristics of leaded devices. Size and weight are reduced by lower voltages and higher speeds. The size of SMD resistors was 1206 in the '70s when first introduced. The industry now is moving toward a reduced size of 0201, though 0603s are still widely used due to their application in telecommunications and consumer electronics end-user industries. Due to higher demand for 0603s, these devices are available at the lowest price in the market and are finding increased application in end-user industries, such as telecommunications, computers, consumer and medical electronics, and the military. However, 0201 will become more common in consumer applications than in the computer industry. Reduction in package dimensions should continue, as fine-pitch capability and microelectronic packaging equipment should improve substantially by 2010.
Electronic packaging manufacturers have made inroads into improving some of the characteristics of electronic components. R&D is focused on improving existing packages, such as ball grid arrays (BGA), chip scale packages (CSP) and multi-chip modules (MCM). These advances are expected to strengthen the world electronic components and packaging market and increase revenue.
Figure. Percentage of revenues by package type in the medical electronic package market, North America, 2003 to 2010.
The figure displays medical electronics packaging trends in the North American EMS provider market. Since products in the medical device market must be FDA approved, products typically are manufactured using the same process and type of components for 10 to 12 years. This poses a challenge for EMS providers when certain components are no longer available. Some component manufacturers develop legacy products, typically done at a premium. Since EMS providers are on the front lines with new product designs in other high-technology markets, they can help medical device OEMs evolve and catch up with the rest of the electronics industry with their designs. As more medical device OEMs outsource, EMS providers should play a more critical role in the type of components used in a device.
Interconnection density in packaging technology is increasing with growing complexity of semiconductor devices. At the same time, there has been substantial reduction in board real estate and an increase in input/output (I/O) capacities. The ultimate package is likely to perform all functions on a single integrated circuit (IC). Assembly of bare ICs onto a motherboard does away with the first level of package technology while occupying the least board real estate on existing SMDs. Two methodologies are used to attach the die to the motherboard: chip-on-board (COB) that uses wire bond technology, and flip chip assembly. The assembly processes must surmount challenges such as handling a bare die, die processing steps involving wire bonding, encapsulation, underfill dispensing and testing to present a fully functional known good die (KGD), with availability of KGD the biggest challenge.
The existing process for SMDs encompassing peripheral leaded packages and area array devices presents robust assembly yields and superior solder joint reliability. New innovations in devices and packaging methods should perform equally well or better when compared to existing assembly and reliability areas to maintain a place in the industry. To attain the functionality and density of bare die assembly, a new generation of devices has been introduced by the packaging industry, which is close to the dimensions of the bare silicon die. CSPs are defined as packages up to 1.2 or 1.5 times larger than the perimeter or the area of the die. These devices assume the stress of miniaturization while retaining the benefits of conventional IC packages. With growth in CSP technology, the devices are reduced to almost the size of the integrated circuit die itself. Recent trends are toward CSPs based on wafer-level processing. These devices are similar to wire-bonded dies with a redistribution layer into an area array format. The assembly constraints for CSPs follow established flip chip processing for devices with small bump features.
Newer ICs are opting for high clock frequencies extending up to gigahertz range. Pin densities are moving below the 1 mm pitch, while pin counts are increasing to more than 500. Packaging for such devices must contain finer interconnections and improved electrical and thermal performance. These high-speed, high-density, high-pin count finer pitch IC packages are acquiring tighter tolerance and microscopic features. High-end packages such as BGAs, MCMs and stacked dies are likely to see more growth as the industry continues to recover from the 2001 economic slowdown.
Electrostatic multilayered ceramic chip (MLCC) capacitors are assembled in MCM packages, in which four MLCCs are combined in a 0805 footprint. Ion implantation techniques are used to direct silicon into silicon dioxide and silicon nitride capacitors that are assembled into packages, such as integrated passive devices (IPDs). These IPDs can accommodate up to 18 MLCCs within one device. Though the capabilities of IPDs are limited to less than 2,000 picofarads, these devices dem-onstrate another method of replacing one active component technology with an individual discrete one by efficient use of silicon. This kind of manipulation of silicon is happening in the MLCC market, where low capacitance values are required. IPDs accounted for less than 2 percent of total global capacitor sales in 2003, and this number is expected to increase to 6 percent by 2008.
Recent developments in ultra capacitors, otherwise known as double-layer capacitors, provide operational advantages, such as high power density, long life cycle and longer DC life that make those devices maintenance-free. These ultra capacitors also feature capacitance values that range from a number of microfarads to a few thousand. Internal resistance of ultra capacitors has reduced considerably from previous devices, making these capacitors suitable for high power burst applications such as small cell and large cell ones.
Small cell applications are comprised of systems employed to load-level the pulse from the main energy sources, such as batteries and fuel cells used in digital cameras, wireless LANs, scanners and actuators. The ultra capacitor relieves the battery of pulsed power functions and higher power density. Therefore, the ultra capacitors, along with the cheaper alkaline batteries have been able to replace high-powered batteries. Due to an increasing need of pulsed power in electronic applications and the technological advantages they offer, ultra capacitors are projected to witness increasing demand starting in 2004. Large-cell applications of ultra capacitors comprise transportation, UPS, industrial and renewable energy source industries. The automotive market is witnessing demand in 42 V subsystems, as well as from distributed power in commercial vehicles. The technological advantages of ultra capacitors in large-cell applications include longer life, lighter weight, lower cost and a wider temperature range. Advancements in ultra capacitors are expected to pose a serious threat for the Li-ion and Ni-MH batteries in high-power applications.
Conclusion
With a shift towards smaller components such as 0201s and IPDs, the SMT capital equipment industry must develop equipment that will handle these smaller components. Although some electronic assemblers are not using some of the smaller components to date, they want equipment that can handle these components in the future to avoid upgrading equipment more frequently. Vendors in the electronic component competitive landscape that adapted quickly to smaller components increased their market share. It is expected the same will happen in the SMT equipment industry.
For more information, contact Julia Paulson, Frost & Sullivan, (210) 247-3870; E-mail: jpaulson@frost.com