FAN-IN - SIP IMPACT AND SMARTPHONE MARKET SLOWDOWN

SiP impact, smartphone market saturation… What will be the future of Fan-in packaging?

Fan-In Packaging: Business update 2016 report – Yole Développement – November 2016

OUTLINES:

  • A steady growth platform with imminent disruptions ahead. How will Fan-In adapt to SiP growth and handle uncertainty in future markets?
  • Functional integration brings uncertainty to the Fan-In platform.
  • The implications of SiP impact need to be considered today.

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LYON, France – November 24, 2016:  Fan-In packaging has been a successful and steadily growing platform for over a decade. However Fan-In packaging should face a challenging future, announces Yole Développement (Yole), the “More than Moore” market research and strategy consulting company. Indeed, despite of unchanged market drivers, Fan-In packaging is showing an uncertain future with a slowing down smartphone market and the growing adoption of SiP technologies. The integration of Fan-In functions in SiP could disrupt the Fan-In market.
Fan-In Packaging: Business Update 2016 report from Yole is the 5th edition. This year, Yole’s advanced packaging team proposes a market overview of the Fan-In landscape with updated market figures and technology roadmaps from 2015 to 2021. The consulting company investigates the industrial supply chain with a detailed analysis of the market positioning of each player. This report also offers a detailed analysis of the SiP impact on the market with two scenarios.

The Fan-In packaging platform remains appealing as an inherently unmatched combination of smallest package form factor and low cost. Due to these features, historically it found penetration in form driven handsets and tablets and has maintained growth within these devices.
“At Yole we estimate that more than 90% of Fan-In packages today are found in the mobile segment”, comments Andrej Ivankovic, Technology & Market Analyst, Advanced Packaging & Semiconductor Manufacturing at Yole. “With respect to Fan-In adoption, in today’s high end smartphones already more than 30% of all packages are Fan-In packages. Therefore, Fan-In packaging spread in the sweet spot mobile segment continues.”
Many companies are today fearing a general slowdown due to smartphone market saturation: against a 35% growth in 2013, Yole announces 8% in 2016 and 6% by 2020 (1). According to the analysts, the market needs to reinvent itself to avoid commoditization. Advanced packaging companies are so searching for new growth opportunities…

The biggest challenge the Fan-In platform will be facing in the future is functional integration of devices into SiP form. Under its new Fan-In report, Yole’s analysts indicate the impact of SiP growth on Fan-In unit production, decreasing the overall CAGR from 9% to 6%.
In order to increase functionality and potentially decrease overall time to market and packaging costs, multichip packaging in the form of SiPs is already under way. While a variety of SiPs are already present in smartphones, a stronger push for further integration of multiple dies in one package can be expected especially in the RF and power management domains. This implies that as a consequence of functional integration, a significant portion of Fan-In dies could be integrated in SiPs. The consulting company Yole analyzed in its report two scenarios: a disruptive SiP impact and a negligible SiP impact on the Fan-In platform.
In the case of negligible SiP impact, the Fan-In packaging services market is expected to rise from US$ 3.1 billion in 2015 to US$ 4.9 billion to in 2021 with a 8% CAGR. The Fan-In wafer count is expected to rise from 3.7 to 5.9 million 300mm eq. wafers from 2015 to 2021, respectively, with a CAGR of 8%. Yole’s market figures indicates the impact of SiP growth on Fan-In wafer production, decreasing the overall CAGR from 8% to -2%. The impact of SiP growth is greater on wafer level than on unit level, due to the size of particular devices expected to be integrated first.

Yole’s report brings a full revenue, wafer and unit forecast by IC device type from 2015 to 2021 as well as a detailed impact of SiP growth. A detailed description of this report is available on i-micronews.com, advanced packaging reports section.

Source:
(1) Sensors for Cellphones and Tablets 2016 report, Yole Développement, Jun. 2016

Acronyms:

SiP : System in Package
CAGR : Compound Annual Growth Rate
RF : Radio Frequency

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