Semiconductor Industry Trends and Growth

IoT: Connected revolution
Semiconductors serve as the foundation for enabling emerging Internet of Things (IoT) technologies. The IoT revolution has increased the demand for semiconductor chips but also shifted value capture to software and solutions. To capitalize on emerging vertical industries in automotive, healthcare, manufacturing, and government, semiconductor companies often need to shift marketing, sales, engineering, and product development approaches. This shift is complicated in a world that is increasingly constrained by trade wars and COVID-19.

Digital supply networks
Digitalization is transforming supply chains in every industry. In most cases the transformation is a shift from a structured, linear system to an open, interconnected, often cloud-based system that integrates information from many different sources. Semiconductor companies should consider emerging digital supply network technologies to solve age old industry problems stemming from limited information transparency across the manufacturing and supply chain.

Consolidation through M&A
As semiconductor industry growth slows in individual segments, companies are increasingly turning towards mergers and acquisitions (M&A) to sustain profitability, seek new sources of revenue, and reduce revenue volatility through a diversified portfolio of products or solutions in the case of IoT. To help ensure value capture, semiconductor companies should consider developing a clear M&A strategy and drive execution.

Cloud
In the world of Chips, Merchant Silicon paves the way for disaggregation. It is becoming more important to differentiate proprietary ASIC (Application-Specific Integrated Circuit) solutions from DIY ( Do it Yourself ) White Boxes. There are no one size fit all Cloud Solutions which can cater uniformly to functional and product workloads for accelerated development and better time to market. Hybrid Cloud Environment is not an economic decision but an imperative for an efficient interoperable data hosting ecosystem. The need for robust DevOps, microservices, security, and network designs will be foundational for running such complex ecosystems.