Prepare for 2010 demand surge, says analyst

LONDON — Looking forward to 2010 Bill McClean of IC Insights (Scottsdale, Ariz.) observed that both PC and cellphone unit volume shipments are forecast to increase at double-digit rates in 2010 and that this indicates an IC market boom is coming.

For equipment makers 2009 was not a good year. PC shipments were flat and cellphone unit shipments were down 5 percent. But when it is considered in the light that the global economy endured its worst recession since 1946, these results are a testament to the demand for electronics, according to McClean.

Capital spending for memory devices is forecast to more than double in 2010. However, this will not be enough avert memory shortages and prices will increase significantly in 2010, the analyst predicted.

Overall, the worldwide IC market declined 10 percent in 2009. In contrast, the NAND flash memory market surged by 20 percent during the year. The NAND flash memory market is set to grow by more than 20 percent in both 2010 and 2011.

Similarly the DRAM average selling prices (ASPs) were 65 percent higher in 4Q09 than they were in 1Q09.

Meanwhile at the other end of the spectrum China's IC production accounted for 1.8 percent of the worldwide total market in 2009 a very small increase from 1.2 percent in 2004. China continues to play minor role in IC production.

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