Digicam Market Research

Solid State Technology: After five years of double-digit growth, the digital camera market is leveling off to a plateau of roughly $18 billion/year as most users have already converted from film photography. The next big growth trend to watch -- the crossover for CMOS image sensors to surpass charge-coupled devices (CCD), according to data from IC Insights Inc.

After quadrupling in value from 2001-2004, the digital still camera market is expected to slow down to just 5% growth in 2006 to $18.1 billion, and remain basically flat through the end of the decade, while unit shipments ratchet down from a 38% compound annual growth rate (CAGR) from 2000-2005 to just 6% CAGR from 2006-2010. About 81.9 million standalone digital cameras are expected to be sold in 2007, a 7% increase from 2006.

An important trend in digital cameras is growing adoption of high-speed CMOS image sensors, which are already in most embedded cell-phone cameras, but now increasingly used in "hybrid" models offering both high-resolution still pictures as well as high-definition full-motion videos. About 79% of today's digital still cameras still use CCDs, but IC Insights projects a crossover by 2009 where CMOS image sensors surpass CCDs in digital still cameras.

This year, Micron has surpassed fabless OmniVision as the top image sensor supplier, with sales surging 147% in its just-closed fiscal 2006 (through August) to $749 million, about 14% of its overall revenues, a 7.5xfold increase from 2004's $99 million. The company is utilizing old DRAM fab lines in the US, Italy, and Japan to produce CMOS image sensors, including a closed 200mm fab in Idaho purchased from Zilog restarted for image sensor work.

Most of the top CCD makers are in Japan (e.g., Matsushita, Fujifilm Microdevices), although Kodak has a CCD fab in New York. But several CCD makers including Sony, Sharp and Toshiba are shifting capacity to CMOS image sensors, and even Samsung is expanding its output of CMOS image sensors.