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Semiconductor revenue worldwide will see improved growth this year of 6,9%, reaching $320-billion, according to the mid-year 2013 update of the Semiconductor Applications Forecaster (SAF) from International Data Corporation (IDC).

The SAF also forecasts that semiconductor revenues will grow 2,9% year over year in 2014 to $329-billion and log a compound annual growth rate (CAGR) of 4,2% from 2012-2017, reaching $366-billion in 2017.

Continued global macroeconomic uncertainty from a slowdown in China, eurozone debt crisis and recession, Japan recession, and the US sequester’s impact on corporate IT spending are factors that could affect global semiconductor demand this year. Mobile phones and tablets will drive a significant portion of the growth in the semiconductor market this year.

The industry continued to see weakness in PC demand, but strong memory growth and higher average selling prices (ASPs) in DRAM and NAND will have a positive impact on the semiconductor market. For the first half of 2013, IDC believes semiconductor inventories decreased and have come into balance with demand, with growth to resume in the second half of the year.

“Semiconductors for smartphones will see healthy revenue growth as demand for increased speeds and additional features continue to drive high-end smartphone demand in developed countries and low-cost smartphones in developing countries.

“Lower cost smartphones in developing countries will make up an increasing portion of the mix and moderate future mobile wireless communication semiconductor growth. PC semiconductor demand will remain weak for 2013 as the market continues to be affected by the worldwide macroeconomic environment and the encroachment of tablets,” says Nina Turner, research manager for semiconductors at IDC.

According to Abhi Dugar, research manager for semiconductors, embedded system solutions, and associated software in the cloud, mobile, and security infrastructure markets.

“Communications infrastructure across enterprise, data centres, and service provider networks will experience a significant upgrade over the next five years to support the enormous growth in the amount of data and information that must be managed more efficiently, intelligently, and securely.

‚ÄúThis growth is being driven by continued adoption of rich media capable mobile devices, movement of increasingly virtualized server workloads within and between data centres, and the emergence of new networking paradigms such as software defined networking (SDN) to support the new requirements.”

Regionally, Japan will be the weakest region for 2013, but IDC forecasts an improvement over the contraction in 2012. Growth rates in all regions will improve for 2013 over 2012, as demand for smartphones and tablets remain strong and automotive electronics and semiconductors for the industrial market segment improve in 2013.

Other key findings from IDC’s Semiconductor Application Forecaster include:
* Semiconductor revenue for the computing industry segment will log year-over-year growth of 2% for 2013 and will show a slow CAGR of only 0,9% for the 2012-2017 forecast period. Semiconductor revenue from mobile PC demand will register year-over-year growth of -0.6% in 2013, only returning to positive growth in 2015.

* Semiconductor revenue for the mobile wireless communications segment will grow 10.3% year over year in 2013 with a CAGR of 5.2% for 2012-2017. Semiconductor revenue for 4G phones will experience an annual growth rate of 121,8% in 2013 and a CAGR of 37,9% for 2012-2017.

* Media tablets, e-Readers, blu-ray DVD players, and set-top boxes will continue to drive above average semiconductor revenue growth. Sales of CRT and rear projection TVs, HD receivers, digital video and still cameras, and DVD recorders and players will continue to erode. Overall, semiconductor revenue for the consumer segment will record year-over-year growth of 15% in 2013 and a 2012-2017 CAGR of 7,5%.

* The 4,3% year-over-year growth in 2013 in wired communications infrastructure semiconductors will be driven primarily by enterprise switches and routers, security appliances, and service provider switches and routers. Optical transport equipment, TDM and VoIP IMS, service provider head-end access equipment, and consumer network will also grow in 2013 over 2012, but to a lesser extent.

* Driven by the increase in semiconductor content in automobiles (such as applications such as in-vehicle infotainment, automobile body electronics, and driver safety systems), semiconductor revenue for the automotive segment is expected to grow 5,3% in 2013.

* Regionally, Asia/Pacific will experience year-over-year growth of 6,9% in 2013 and a CAGR of 4,9% for 2012 to 2017.