LOOKING FOR POSITIVE SIGNS IN A STAGNANT SEMICONDUCTOR MARKET

The semiconductor industry, as a whole, was devastated in 2001 and remains in a relatively stagnant state as it attempts to recover. To find positive market conditions within this industry, one has to look closely at individual semiconductor industry sectors in order to identify positive market niches within. Venture Development Corporation's (VDC) recently released report on the power supply and power management IC market has identified a number of positive trends within this sector of the semiconductor industry.

Natick, Massachusetts - The semiconductor industry, as a whole, was devastated in 2001 and remains in a relatively stagnant state as it attempts to recover. To find positive market conditions within this industry, one has to look closely at individual semiconductor industry sectors in order to identify positive market niches within. Venture Development Corporation's (VDC) recently released report on the power supply and power management IC market has identified a number of positive trends within this sector of the semiconductor industry.

Worldwide Shipment Share of Power Supply and Power Management ICs, by Application
(Percent of Dollar Volume)

2001 Total: $4,751.6 Million

Telecom - Fixed and Portable: 23.4%
Computers & Peripheral: 21.6%
Consumer Electronics: 13.9%
Merchant Pwr Supp/Chargers: 13.8%
Instruments: 9.5%
Automotive: 7.5%
Datacom: 5.5%
Military/Aerospace: 4.8%

To view the entire press release including charts go to
www.vdc-corp.com/power/press/02/pr02-43.html

Product Types - Portable electronics continue to demand more features with greater power consumption in less space. Without necessary advances in battery technologies, the requirements for these demands are met using advanced switching and battery management ICs. In fact, VDC expects that battery charging and management ICs will grow at nearly an 18% combined annual growth rate (CAGR) through 2006.

Application Markets - The telecom market was devastated in 2001 and has a long road ahead before full recovery. Nonetheless, sectors of this market look promising and are expected to return to growth. Emerging 2.5G and 3G mobile handsets are forcing designers to use highly efficient power management ICs to maintain battery life.

Factors increasing demand among computer & peripheral applications include the emergence of distributed power architectures and "standby" power supply sections in personal computers and workstations. Notebook computer applications are expected to have the highest growth rates, particularly for battery charging and management ICs. Increasing microprocessor needs (decreasing voltage and increasing current) are demanding the use ICs that enable highly efficiency tightly regulated power.

The consumer electronics industry is a high growth market segment, particularly for portable product applications. There is need for safe and efficient battery chargers, stand-by modes, and longer run times on products such as camcorders, digital cameras, MP3 players, and personal organizers. An emerging market within consumer electronics is the wearable computer market.

Geographic Markets - The Asia-Pacific region saw a significant increase in market share in 2001. This was primarily at the expense of North America, and to a lesser extent, Japan. As OEMs reduced production to meet market demand declines, they consistently reduced production at North American and Japanese facilities. Long-term advantages will continue to support Asia's greater geographical share, especially with the emergence of China as an attractive location for electronics manufacturing.

November 2002

**************************************************

ABOUT THE STUDY

This report, "The Global Market for Power Supply and Power Management Integrated Circuits", is a multiclient study designed to provide subscribers with relevant and up-to-date market intelligence to support strategic marketing and product planning decisions. This report includes:

- Forecasts by product categories, major applications, geographic regions, channels of distribution, power ratings, and standard versus custom designed ICs;

- Major issues, technology trends, and OEM needs that affect the future of this market;

- Discussion of the industry structure and the influences generated by the various types of participants;

- Worldwide vendor shipment levels and market share data, by product categories and geographical distribution;

- Detailed profiles on the leading worldwide suppliers of power supply and power management ICs; and

- Recommendations providing insight into current and future market opportunities in this highly competitive marketplace.

Venture Development Corporation, a technology market research and strategy firm, was founded in 1971 by graduates of Harvard Business School and MIT. Over the years, VDC has developed and fine-tuned a unique and highly successful methodology for forecasting and analyzing dynamic technology markets. VDC has extensive experience in providing analysis in electronic components markets. This includes multiclient and custom consulting engagements in a broad spectrum of related topics including switching power supplies, uninterruptible power supplies, fuel cells, static transfer switches, and others.

**************************************************

Report Availability
www.vdc-corp.com/power/annual/01/br01-20.html

**************************************************

For further information regarding "The Global Market for Power Supply and Power Management Integrated Circuits" contact:

Nathan Andrews, Practice Director
nathana@vdc-corp.com

Marc Regberg, Senior Vice President
msr@vdc-corp.com

If you would like to subscribe to more VDC updates go to: www.vdc-corp.com/subscriptions