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IoT Driving Global Semiconductor Packaging and Assembly Equipment Market

Technavio analysts forecast the global semiconductor packaging and assembly equipment market to post a CAGR of 4.7% by 2020, according to their latest report.

The research study covers the present scenario and growth prospects of the global semiconductor packaging and assembly equipment market for 2016-2020. To calculate the market size, the report considers the revenue generated from the sale of die-level and wafer-level packaging and assembly equipment to semiconductor manufacturers.

Technavio’s report segments the market in two different main types of equipment:

  • Global die-level packaging and assembly equipment
  • Global wafer-level packaging and assembly equipment

“In 2015, die-level packaging and assembly equipment was the most prominent segment of the global semiconductor packaging and assembly equipment market, accounting for 60.6% of the total market. The primary reason behind the segment’s market dominance is the increasing demand for the application process, baseband, and SoCs, which are integrated in mobile devices. Wafer-level packaging and assembly equipment accounted for 39.42% of the overall market in 2015,” said Technavio lead semiconductor equipment analyst Asif Gani.

Technavio’s report highlights four major factors that are influencing the growth of the global semiconductor packaging and assembly equipment market:

  • Rising demand for polymer adhesive wafer bonding equipment
  • Growing application of semiconductor ICs in the IoT
  • Increasing complexity of semiconductor IC designs
  • Increasing miniaturization of electronic devices

Rising demand for polymer adhesive wafer bonding equipment

The demand for polymer adhesive wafer bonding equipment is rising due to the increasing adoption of advanced packaging applications like TSV, 2.5D and 3D ICs, stacked die packaging, and MEMS packaging. Polymer adhesive wafer bonding equipment provides reliable thinning and backside processing of the stacked dies. In addition, it lowers the cost of TSV integration. The rising demand for polymer adhesive wafer bonding equipment will therefore have a moderately high impact on the market for semiconductor devices, as this equipment supports 3D packaging, which is the future of the semiconductor packaging and assembly industry.

Growing application of semiconductor ICs in the IoT

An estimated 30 billion devices will be connected through the IoT by 2020. The IoT enables devices to collect data using sensors and actuators and transmit data to a centralized location on a real-time basis. The IoT has been extensively adopted in multiple market segments (consumer electronics, automotive, medical) and will likely drive the market for semiconductor devices and associated equipment during the forecast period.

The IoT requires the application of ultra-low power (ULP) processors. Therefore, to reduce the size of the processor chip and to fit in compact devices like wearables, development of new packaging technologies is necessary. The growing application of semiconductor ICs in the IoT will have a moderately high impact on semiconductor device manufacturers, as it is estimated that the market for semiconductors and sensors for IoT applications will cross the USD 50 billion mark by the end of 2020. Manufacturers will have to either increase their production capacity or revamp their technologies to match the changing technological environment.

Increasing complexity of semiconductor IC designs

Due to the increasing functionalities of consumer electronics, there is an increasing need for multifunctional ICs. Semiconductor manufacturers have addressed this need by developing sophisticated architecture and designs for semiconductor ICs. Manufacturing semiconductor ICs based on these designs is complicated, which has created a demand for upgraded packaging and assembly equipment.

“The increasing complexity of the semiconductor wafer design will have a moderate impact on semiconductor device manufacturers, as they must invest in packaging and assembly equipment to maintain the performance of semiconductor ICs,” said Asif.

Increasing miniaturization of electronic devices

The increasing demand for compact electronic devices used in multiple sectors like telecommunications and automotive has led to further miniaturization of semiconductor ICs. With advances in technology like 3D ICs and MEMS, as well as changes in the design of ICs such as finer patterning, electronic equipment is becoming more compact and user-friendly. MEMS is a technology used for miniaturization of chips by the process of microfabrication.

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