Microcontrollers Make Waves in Automotive and Internet of Things



Market analyst sees a blurring of the lines between microcontrollers and microprocessors, including the move to multicore and systems-on-chip

Semiconductor market research company IC Insights has released the 2014 edition of The McClean Report (http://www.icinsights.com/services/mcclean-report). We talked to Senior Market Research Analyst Rob Lineback to get his views on microcontroller trends (responses edited for clarity and space).

EECatalog: Your report shows a downward or flat trend in low-end controllers. Overall in microcontroller trends, is the change due to the need for higher performance in more applications?

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Lineback: It’s getting to the point where with chip integration and architecture, suppliers are able to deliver 32-bit, RISC-based microcontrollers at almost the same price and sometimes slightly less than even 8-bit designs. So from a cost point of view, the 32-bit doesn’t really have any penalty. It’s not any more expensive. The issue is always—in microcontrollers as well as microprocessors—the programming and how much has been done in converting that over. There is an effort by a lot of companies to build a migration path for 8-bit designs to move to 32-bit, especially with the types of legacy architectures that are not ARM-based. Companies that have been leaders for a long time have built migration paths from their 8-bit families to new 32-bit architectures. That’s been one attempt to try to maintain market share. Of course, ARM-based microcontrollers have really hit the market in a big way, with a lot of companies licensing the architecture and most major suppliers have an ARM-based offering. ARM has changed the marketplace quite a bit.

EECatalog: Are there penalties for making the migration from 8-bit to 32-bit?

Lineback: The one thing they have to do if they’re using an 8-bit is to rework their code so that it can run on a 32-bit architecture. Some companies have built in compatibility of their 32-bit designs so that it can run recompiled code. They’ve already been trying to diminish the amount of work that an engineer might have to do to move a design from an 8-bit microcontroller to a 32-bit. But honestly, I think there are so many new applications and that’s really driving the market; it’s not so much taking something that existed and trying to upgrade it to 32-bit although that does happen. I think it’s the appearance of a lot of new types of systems that are driving the growth.

EECatalog: If we look back historically at where the large market segments were for low-end processors—white goods, automotive, etc.— is that still typical?

Lineback: Home appliances are significant, but automotive is a major segment for microcontrollers. It’s by far the biggest MCU application—in 2014, we think about 48% of overall microcontroller dollar sales will be in automotive.

EECatalog: What about 8/16-bit specifically?

Lineback: There are a lot of applications for 8/16-bit microcontrollers in automobiles. Actually quite a few specialized 16-bit microcontrollers are aimed specifically at automotive applications. 16-bit devices have digital signal processing type technologies (people call 16-bit microcontrollers digital signal controllers, or DSCs). They tend to be oriented toward more real-time and math-intensive type applications, so there are lots of automotive specialized microcontrollers that are 16-bit. 32-bit is certainly gaining share in the automotive segment as a lot of applications are moving to 32-bit in automotive.

One thing to make note of is that the 4/8-bit (mostly 8-bit) unit shipments will still be the largest volume in the microcontroller business even out to 2018. We know that 32-bit is on the verge of passing 8-bit unit shipments, and dollar-wise, of course, it’s quite a bit more because 8-bit devices are being pressured to be lower and lower cost.

EECatalog: What do you expect from a market segment standpoint? Do you expect that automotive will continue to be the largest segment, or do you see growth coming from other areas?

Lineback: Automotive will be a large market for the foreseeable future, so it’s significant. Now whether it’s something close to 50 percent… it definitely will be drifting down as we see more microcontrollers used in new things that are emerging like the Internet of Things. As that takes off, there’s a lot of Internet connection being built into microcontrollers and that’s driving 32-bit designs. Then you have the wearable medical type of devices and wearable electronics—the medical electronics segment is growing quite strong and using a lot of microcontrollers and we think that will be growing faster. We think home automation and you mentioned MEMS and sensors—anytime you have a sensor of any kind, a microcontroller is usually involved or connected. As those applications keep growing—as we have self-aware systems that either know there’s movement or sense things around them— there’s a microcontroller sitting there doing the work.
One thing that I think is going to be interesting to see out in the future—and this may have an impact on who’s playing in this whole market—is I’ve always seen microcontrollers way back to the 1980s as being systems on chip, SoCs. And we’re seeing SoCs in processors growing too. Now a lot of those are ARM-based, but Intel is definitely making a big push with its Atom SoC that’s not just aimed at cell phones and tablets and even notebooks, but they’re going after embedded applications in medical, television and such. I think there’s going to be a point, probably by the latter part of this decade, where we might see SoCs—microprocessors and microcontrollers—being pretty much the same thing. It’s going to be hard to differentiate between them because all the functions that are on a microcontroller are appearing on SoC designs, which has a little more on-chip. We’re not splitting the two in forecasts yet, but it’s something to be mindful of. It’s going to get very blurry further out.

I guess we could see that Atom could end up coming back as a microcontroller type of device, as a system on chip. A lot of the applications they’re going after are the same ones that are driving microcontrollers. We’re seeing microcontrollers in SoCs as the processors serving a lot of the wearable stuff as well as medical. In teardowns, sometimes it’s a microcontroller and sometimes it’s an ARM-based processor. What’s the difference between the two?

EECatalog: Are there viable options to ARM?

Intel would be an option. There are also the old MIPS cores which were acquired by Imagination Technologies, which is a competitor of ARM. They’re known mostly for graphic cores but they said in June that they intended to use the MIPS core aimed at microcontrollers and try to go after that market. Probably the biggest user of the MIPS core is Microchip, which is ranked number four in overall MCU sales by revenue (2012 are most recent numbers). Renesas is the biggest by far still, even though they’ve had a pretty good decline in sales. They actually don’t sell an ARM-based controller, so theirs is internal. Samsung we show as second, but they sold their 4/8-bit microcontroller business (they didn’t have much of a 32-bit presence) to IXYS. Fujitsu sold its microcontroller business along with analog ICs to Spansion, which is known for its flash memory—they’re trying to get into the microcontroller business because they see the microcontroller as basically a platform to put their flash technology on. There have been other acquisitions. As far as ranking, Samsung was number two, but that’s mostly 8-bit. Freescale we have ranked third in 2012. They have their own internally designed 32-bit microcontrollers based on the Power architecture, but they also sell a line of ARM-based devices and they’ve been expanding that quite a bit. Microchip is number four, STMicroelectronics is fifth, Atmel sixth, Infinion seventh, TI is eighth, Fujitsu is nine (they sold their business to Spansion), and NXP, which used to be Phillips, is ten.

That’s the overall ranking, but the ARM business is definitely reshaping the marketplace. They have four core architectures for 32-bit microcontrollers. One or two of them are aimed at the low-end, simple designs: the Cortex M0 and the Cortex M0+, which is the one being used for the Internet of Things and wireless systems. We don’t have the 2013 numbers, but ARM estimated about 1.9 billion Cortex M-based microcontrollers were shipped in 2012, which is about a 73% increase from 2011. For 32-bit designs, the ARM-based microcontrollers had 31% market share in 2010, 45% in 2011 and 51% in 2012. That’s pretty significant—a little more than half of all units shipped. You make the assumption that it’s still going up so they’re probably up around 55%, maybe even getting close to 60% this year.

EECatalog: Are those mostly new designs?

Yes, lots of Internet of Things, there’s a lot more automotive that’s going 32-bit, and consumer. It ends up that 32-bit is going into a lot of new sockets, so that’s one of the reasons it’s growing so strong. The need for higher precision, more real-time and the Internet connection factor is playing a big role in driving 32-bit sales.
There always will be new things happening in 8-bit and 16-bit. In the 8-bit world the emphasis has been on being able to have high levels of code efficiency to be able to keep the memory requirements low and the programming simple. The 16-bit world is driven by being more specialized and more focused as far as an application-oriented or specific microcontroller. 16-bit is big in automotive and audio systems as well as motor control.

EECatalog: Anything else of particular interest to you?

One new trend we’ve seen is multicore microcontrollers. We hear about multicore microprocessors in PCs and tablets and smartphones, but we’re seeing some multicore microcontrollers in the market. Some units might have two 32-bit cores, there’s been some mixing of 32-bit ARM—for instance, TI has a 32-bit ARM core mixed internally with a digital signal processing microcontroller core. We’ll have to see how that plays out. There are a lot of parallels between microcontrollers and the microprocessor world so I think we’re going to see some blurriness in definitions as we get further out.

fig1
Figure 1: Revenue growth in 32-bit microcontrollers will continue to outpace sales of 4/8-bit and 16-bit MCUs during the next five years.  (Source: IC Insights’ 2014 McClean Report)
fig2
Figure 2: In terms of device shipments, 4/8-bit MCUs overtook 16-bit devices in 2013 to regain their historic position as the largest unit-volume category in the market.  The outlook shows 4/8-bit MCUs remaining the largest unit-volume category in microcontrollers during the next five years, but 32-bit shipments are expect to be on the verge of taking the lead in 2018.
Editor’s Note: in our discussion, Rob clarified that the graphs for unit and sales volume are somewhat skewed by the inclusion of smartcard microcontrollers along with mainstream MCUs.  From a unit perspective, smartcards make up almost half of overall MCU unit shipments. In 2013, the smartcard business had a market correction based on delays in government and transportation programs worldwide and unit volumes fell after large volumes sales in 2011 and 2012. Because of the smartcard correction, IC Insights shows overall MCU unit sales declined 7% in 2013 to 16.1 billion from a record high of nearly 17.3 billion in 2012. Excluding smartcard units, shipments of mainstream, embedded microcontroller devices grew 11% to about 8.8 billion units from 7.9 billion in 2012. However, on the revenue side, the total smartcard sales volume in 2013 was $2.3 billion while total microcontroller sales in 2013 were $15.3 billion. This represents the dramatic difference in average selling price (ASP) of $.31 for smartcard microcontrollers in 2013 vs. $1.49 ASP for all mainstream microcontrollers.

coupe_cherylCheryl Berglund Coupé is managing editor of EECatalog.com. Her articles have appeared in EE Times, Electronic Business, Microsoft Embedded Review and Windows Developer’s Journal and she has developed presentations for the Embedded Systems Conference and ICSPAT. She has held a variety of production, technical marketing and writing positions within technology companies and agencies in the Northwest.

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