Monday, August 03, 2009

Strategies Unlimited Predicts Start of the New Era

Strategies Unlimited predicts decline of image sensor market to $6.4 billion in 2009, a drop of 11% from 2008 and the first decline since the company began tracking the market in 1997. Growth is expected to return in 2010, but the average growth rate will be in the single-digits in coming years, following over a decade of 22% compound annual growth, as on the chart below:



Other predictions:

A new, more cyclic phase. The current global economic cycle is driving a temporary decline, but cycles will have a stronger effect going forward, now that the perfect convergence of forces leading to rapid growth in image sensor revenues for cameraphones is maturing. There will still be growth in unit sales in coming years for image sensors overall, but short-term fluctuations in demand, periods of oversupply and shortage, and severe price pressure will make it more challenging to stay competitive than before.

Turmoil in Japan. Japan used to dominate world image sensor production, and still manufactures over 90% of the world’s CCDs. CCDs continue to dominate in digital still cameras and security cameras. Even so, Fujifilm stopped production of image sensors for its line of cameras in 2007. Sony is thinking of stopping its production of CMOS arrays for cameraphones, and Panasonic has already done so.

Koreans make huge strides. Meanwhile, Korean and Taiwanese suppliers are gaining market share, especially for cameraphones. Samsung grew 61% from 2006 to 2008, placing it among the top suppliers. Strategies Unlimited is also seeing increased competition from other Korean and Taiwanese companies, such as SETi, SiliconFile Technologies, and PixArt Imaging. Hynix reentered the image sensor business in the second half of 2008. These companies are focusing on the China handset market.

6 comments:

  1. I wonder what is included in the $6.4 billion. It seems about 3 times too high to be just the sensor silicon.

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  2. my calculation is that the total sales for sensors was in the range of about $4.5B in 2008

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  3. Sensor, lens packaging, test - all managed by the sensor providers. There's some misinformation in this piece. I was on a conference call two weeks ago with Fujifulm. Fujifilm announced two SuperCCD consumer cameras, manufactured at their fab.

    Regards,

    Ron Tussy
    Principal Analyst
    The Imerge Group

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  4. Ron,

    Are you saying that $6.4B includes sensor, lens, packaging and test together?

    I've seen Fujifilm announcements. I only picked up 3D announcements from them. You are right, other cameras with HDR modes and multi-frame capture tricks might be worth publishing too.

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  5. IS: I'm saying the holy grail for OEM's is to get to a 5MP module for under a buck. This will happen with BSI, active lens solutions and AA packaging within the next two years, probably less. So from that standpoint, the forecast might be close. Gotta go and get back under the radar.

    RT

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  6. To RT

    I think your predicion for 5MP is unlikely to happen even in 5 years time. The key factor here is not the technology, but corporate revenue.

    Lets assume a 5MP module does end up being $1, it would be pretty safe to say that a huge proportion of the market volume will be 5MP, say 60%. Lets predict that by 2015, the total market for cellphones reaches 1.5 billion. The numbers would then be: 1.5 * 0.6 * 1 = 0.9 billion. There simply isn't enough money to keep the 5MP segment of the market afloat. No one in their right might would want to run this sort of business.

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