The semiconductor industry is highly volatile in nature. Leading market participants in this industry are fabless companies that focus on leveraging their resources in designing and utilizes its expertise in enhancing the performance of the chipsets or ICs. Thus, most of the semiconductor assembly, testing, and packaging related services are outsourced by fabless companies to third party providers known as Outsourced Semiconductor Assembly and Test Services (OSATS) Providers. Moreover, the shift of semiconductor processing technology to the larger wafers and smaller feature sizes has increased the cost of building a state-of-the-art wafer fabrication factory. High CAPEX involved in wafer fabrication and its associated packaging and test operations has enforced semiconductor companies to remain fabless and instead focus on their core business. As a result, SATS providers have witnessed high demand in the past and are expected to be sole choice for fabless companies during the foreseeable future.
The global semiconductor assembly & testing services market is anticipated to expand at a CAGR of 4.7% during the period 2015-2021 to reach US$ 39,050.7 Mn by 2021.
The global semiconductor assembly & testing services market was valued at US$ 28,177.9 Mn in 2014. Increasing adoption of consumer electronics products including tablet PCs, wearable devices (smart watches, smart glasses, head mounted displays, fitness equipment etc.), gaming consoles, audio/video devices along with the rising penetration of smartphones in the communications segment is driving the overall SATS market growth. Additionally, growing technological advancements in next-generation cars (automotive electronics) equipped with enhancing car safety and management systems, are also driving the growth of SATS market.
In 2014, the assembly & packaging services segment was valued at US$ 22,298.9 Mn and is expected to account for US$ 23,494.8 Mn by the end of 2015. Advanced packaging solutions such as wafer level packages and flip chip are driving the market growth of packaging solutions (inter-connecting solutions) segment in the total SATS market.
In 2014, wafer level packaging segment was valued at US$ 3,508.9 Mn and is expected to reach US$ 3,800.6 Mn by the end of 2015. Growing adoption of wearable devices which mandates high performance with low power and thermal ratings, the demand for wafer-level packaging inter-connecting solution is expected to grow in the foreseeable future. This segment is analyzed to expand at a CAGR of 9.2% during the forecast period.
In 2014, consumer electronics application segment was valued at US$ 3,738.5 Mn and is analyzed to value US$ 3,999.6 Mn by the end of 2015.
Key players in global semiconductor assembly & testing services market include ASE Group, Amkor Technologies Inc., STATS ChipPAC Ltd. (JCET), Silicon Precision Industries Co. Ltd., Powertech Technology Inc., CORWIL Technology corporation, Psi Technologies Inc. (IMI), Global Foundries and Chipbond Technology Corporation.
The SATS market is anticipated to have substantial growth mainly driven by the increasing costs for advanced packaging solutions. However, with increasing competition, the price is expected to decrease in the foreseeable future. Major drivers propelling the market include: increasing demand for mobility and connectivity in consumer electronic products and increasing demand of advanced electronic systems in the automobiles Additionally, increasing demand for mobility and connectivity in the consumer electronic products and ability of SATS providers to facilitate a more efficient supply chain and reduced time-to-market are few other factors propelling the market growth. SATS providers offer additional features over in-house testing and packaging capabilities which is one of the primary factors for Integrated Device Manufacturers (IDM) to outsource the SATS services. In addition, the global market of semiconductor assembly and test services has been witnessing the emergence of strategic alliances and collaborations among the leading providers and manufacturers due to rising financial pressures.
Currently, more than 50% of the market accounted for Outsourced Semiconductor Assembly and Testing (OSAT) services, and this fraction is expected to increase during the forecast period. Although many of the low-end SATS providers are competing on price-driven products,
To understand and assess the opportunities in this market, the report is categorically split into three sections, namely, market analysis by services, application, and region. The services section is further sub-segmented on the basis of interconnecting technologies. The report analyzes the global semiconductor assembly and testing services market in terms of market value (US$ Mn).
The report starts with an overview of the global semiconductor assembly and testing services market and usage of these services in various applications across the globe. In the same section, PMR covers the global semiconductor assembly and testing services market performance in terms of revenue. This section includes PMR’s analysis of key trends, drivers, and restraints from supply and demand perspectives. Impact analysis of key growth drivers and restraints, based on the weighted average model, is included in this report to better equip clients with crystal clear decision-making insights.
The Semiconductor Assembly and Testing Services market is segmented as follows:
On the basis of services, the SATS market is segmented into:
Of these, the assembly & packaging services accounted for the highest share of the overall semiconductor assembly and testing services market in 2014. The semiconductor assembly and testing services market is mainly driven by factors such as increasing adoption of consumer electronics products such as tablet PCs and wearable devices (smart watches, head mounted devices, fitness equipment etc. in the developed economies.
The section that follows analyzes the market on the basis of packaging solutions and presents the market size in terms of value for the forecast period.
On the basis of packaging solutions, the SATS market is segmented as follows:
Of the above-mentioned segments, the wafer level packaging segment is expected to increase at the highest CAGR during the forecast period. However, the copper wire and gold wire bonding segment is expected to dominate the semiconductor assembly and testing services market in terms of value, by 2021.
On the basis of application the SATS market is segmented as follows:
Of the aforementioned segments, the consumer electronics segment is expected to expand at the highest CAGR during the forecast period. However, the communications application segment is expected to dominate the semiconductor assembly and testing services market in terms of value, by 2021. Leading market participants are investing heavily in R&D activities in order to innovate new advanced packaging solutions that would cater to the growing demand of miniaturization and low power requirements. For instance, in May 2014, STATS chip PAC (now JCET) introduced innovative FlexLine Manufacturing line. This manufacturing line can process multiple silicon wafer diameters, and produce both fan-in and fan-out wafer level packages on it. Additionally, it pioneered the Through Silicon via (TSV) enabled 3D chip stacking technology in August 2013.
The report also analyzes the market on the basis of region and presents the market size in terms of value for the forecast period.
Regions covered in the report are as follows:
Of the aforementioned segments, the Taiwan market is expected to expand at the highest CAGR during the forecast period and is expected to remain largest market share, out of the total semiconductor assembly and testing services market in 2021.
The leading players including:
Are focusing on obtaining the competitive edge by targeting the advanced expensive packages.