No doubt about it, the frequency and control devices market is big. According to some market observers, it’s around a $6B market and growing, essential to all electronic systems and fueled further by end markets like automotive, the Internet of Things and 5G.
MEMS timing devices have been on a particularly steep growth trajectory, solving critical timing issues for 5G with their ability to handle rugged conditions like shock, vibration and temperature swings unlike their competition, quartz crystal oscillators. Some experts estimate the reliability of MEMS to be 10X greater than that of quartz oscillators.
“I think the fact that more electronics are moving to the outdoors—where the environment is not controlled--is the killer app for MEMS,” said Piyush Sevalia, Executive VP, SiTime. The company owns 90% of the MEMS-based timing market.
As a case in point, he pointed to the millions of small cells, pizza-box-size transmitters packed with antennas and electronics, that will be necessary to build the foundation of nationwide 5G networks. MEM-based timing devices will be inside.
As MEMS is a disruptive technology poised for high growth, it is forecast to be less hard hit than other technologies in this current downturn.
Notwithstanding the positive growth trajectory, Frank Kuzler, President/Senior Analyst of Dedalus Consulting, noted that the segment took a hit from the decline in industrial production in major markets across the Globe in 2019. “This had a ripple effect through the frequency control market. The CAGR (compound annual growth rate) dropped by several percentage points across multiple markets,” he said.
He further noted that while 2020 year started out strong, that due to the drop-off in industrial production from COVID-19, many sectors are already or will be hard hit. “The global pandemic is driving down both production and demand of the end-use product as well,” Kuzler said. “There will likely be shortages through the rest of this year as production gets back online. Already we've seen delays in shipping of finished products like automobiles, aerospace is totally down, personal electronics is being impacted.”
MEMS will also see a drop-off in CAGR, but Kuzler explains that it will be less hard hit as it is essentially a disruptive technology starting from a smaller base and poised for fantastic growth as mobile, wearable and IoT applications continue to expand. According to Dedalus Consulting’s Frequency Control Global Market Report 2020, MEMS will account for 6% of the market.
Kuzler sees a bounce back in 2021, anticipating a recovery and rebound elevating CAGRs past previous growth levels. “There will be slight fluctuations based on distributor backlog, but the market will start to smooth out,” he said.
That prediction jibes with data from the second quarter 2020 update of SEMI’s World Fab Forecast, released Tuesday. The report forecasts that DRAM will decline 11% this year, then surge 50% next year. Logic and foundry will also drop 11% this year and rise 16% in 2021.