MARKET TRENDS

Integration of MEMS components and sensors is not new to the mobile phone industry. For example, FBAR RF filters and silicon microphones have been integrated on our mobile phones since 2002. More recently, MEMS accelerometers have been established as a “must-have” feature for many smartphones and feature-phones. And other types of sensors, like CMOS image sensors, have experienced a large success in the recent years.

But the mobile phone market is changing extremely quickly. It appears that in 2010 we are at a turning point in the history of MEMS & sensors for handsets: the market for MEMS & sensors will experience double digit growth, from $3.55B in 2009 to $7.91B in 2015.

We have identified several factors explaining why MEMS & sensors will experience this tremendous growth over the next few years:

• Share of smartphones is rising faster than ever: 44% of the mobile phones will be smartphones in 2015. Success of smartphones is leading to an increasing amount of MEMS & sensors in mobile phones to provide new features/ services to end-users, to reduce cost through more integration or to improve hardware performance
• GPS integration is not limited to high-end phones anymore. Nearly one phone in three will incorporate GPS in 2010. This is an additional driver to integrate motion sensors: when combined with compass, accelerometers or gyroscopes, this enables new services to be deployed
• The RF part of cell phones is currently changing very quickly, with more and more multi-band multi-mode mobile phones. The incoming deployment of new standards (LTE network in particular) has a direct impact on RF components and will open new doors for online services using an increasing amount of sensors

One striking illustration on how quickly things can happen in the mobile phone industry is the recent release of iPhone 4, the first mobile phone to integrate a MEMS gyroscope, followed a few days later by the announcement of InvenSense IPO. The gyroscope business is now expected to boom very quickly: we believe that the gyroscope market for mobile phones will be more than $80M in 2010 already. We believe strongly that the impact of gyroscopes on the user experience will be as high as the accelerometer case. Only 3 years ago the first accelerometers were integrated on mobile phones, at a price level similar to gyroscopes today. Now accelerometers are viewed as commodity products in some platforms and their penetration should be above one third of cell phones in 2010. Total motion sensor market for mobile phone will reach $1.19Bin 2015, with a 25.3% CAGR.

Gyroscopes are not predicted to be the only “killer app” in handsets for the years to come. Many other signifcant changes are also expected:

• While the accelerometer and compass try to offer differentiating features, gyroscopes are now entering the mobile phone business, and efforts are also put on pressure sensors. Combo of motion sensors with an increasing processing part are now in development
• RF filters, variable capacitors and silicon MEMS oscillators should benefit from the changes occurring at the radiofront end level, from the increasing market for duplexers to the LTE impact on multi-mode phones.
• Silicon microphones are being accepted by the handset market. The cost benefit of ECM tends to decrease, and silicon microphones offer many other advantages. The emergence of dual-microphone solutions for ambient noise cancellation is going to push this business.
• Numerous innovative developments in the optical MEMS area are observed. Integrated  picoprojectors could make the micromirror market take off, while new microdisplay concepts expect to widely decrease power consumption.
• CMOS image sensors are already a very big business. The battle is intense between the competitors to develop the next key features such as BSI, WLO, autofocus solutions or stabilization.
• Several other emerging sensors have been identified, with the potential to become new killer applications in 5 to 10 years: microspeakers, environmental sensors…

Such an attractive market brings with it intense competition between players. We can observe very quick changes in the supply chain since 2 years with the emergence of new players, the alliances between companies and regular fundraising / acquisitions, in particular when it comes to startups. IDMs such as ST Microelectronics have been established as business leaders, by offering reliable components, high level of customer support, an extensive product portfolio and huge price reduction. However few fabless companies have been successful and several innovative fabless start-ups are expected to impact the market within a few years.

COMPANY INDEX

3M, AgileRF, Aichi Steel, AKM, Akustica, Alces Technology, Alps Electric, Analog Devices, Apple, Aptina Imaging, Artificial Muscle, Asahi, Atmel, Audiopixels, Authentec, Auxitrol, Avago, Baolab, BEI Kimco Magnetics, Best Sound Electronics, Bluechiip, Bosch Sensortec, Btendo, Cambridge Mechatronics, Carnegie Mellon University, Cavendish Kinetics, CEA Leti, Ceradyne, ChipSensors, CSEM, Cypress, Dai Nippon Printing, Deep Di Semiconductor, DelfMEMS, Discera, Domintech, DXO, Epcos, Epson, Epson Toyocom, Fox Electronics, Fraunhofer IZM, Freescale, Fujitsu, G-TEK Scientific, Hamamatsu, HDK hokuriku, Hillcrest Lab, Hiperscan, Honda/Stanford University, Honeywell, Hosiden, HT Micro, IBM, iC Haus, ICT, IDT, IMEC, Infineon, Intersil, Invensense, Jyve, KDS, Kionix, Knowles Acoustics, Kyocera, Lawrence Livermore National Laboratory, Lemoptix, Lensvector, LG, Light Blue Optics, LighTuning / Egis Technology, Linear Technology, M2E power, Maradin Technologies, Maxim, Mcube, MEMSIC, Memsmart, Memsmeriz, Memstech, Micro infinity, Microflown Technologies, Microsemi, Microvision, Miradia, MIT, Mitsubishi, Mitsumi Electric, Mobius microsystem, Motorola, Movea, MTI Fuel Cell, Murata, MyFC, NDK, New Scale Technologies, Nippon Signal, Nokia, NPC, NTT Docomo, Nuvoton Technology, NXP, Olympus, Omnivision, Omron, Optotune, Opus Microsystems, Osram, Panasonic, Paratek, Pegrine SC, Pixart, Pixtronix, Polight, Powermat, Qualcomm, Qualtre, Rakon, RFMD, RIM, Rohm, Samsung, Sand9, Seiko Instruments, Senda Micro Technologies, Senodia, SenseAir, Sensirion, Sensor Platforms, SETi, Sharp, Siimpel, Silicon Clocks, Silicon Labs, SiTime, Siward, Skyworks, Sony, SonyEricsson, ST Microelectronics, Taiyo Yuden, Tessera, Texas Advanced Optoelectronic Solutions, Texas Instruments, Tohoku University, Toshiba, Triquint, TXC, Unipixel, Upek, Varioptic, Vasstek, Veratag, Virtus Advanced Sensors, Vishay, VTI, VTT, Wacoh, Wispry, Xiamen Hualian Electronics Company, Yamaha, Yishay Sensor, ZTE.

REPORT OUTLINE

• Worldwilde market metrics:

> 2009 – 2015 market (M units/$M) & ASP ($)

> 2009 market shares

• 150+ companies included in the report

• Report is a 330+ slides PowerPoint presentation

• Excel datasheet included

• 20+ key devices are described: ALS & proximity sensors, BAW filters & duplexers, CMOS image sensors, CO2 & other gas sensors, Digital compass, Fingerprint sensors, Humidity sensors, Liquid sensors, MEMS accelerometers, MEMS autofocus, MEMS energy harvesting, MEMS gyroscopes, MEMS RFID, MEMS variable capacitors, Micro fuel cell, Microdisplays, Micromirrors, Microspeakers, Pressure sensors, Silicon MEMS oscillators, Silicon Microphones, Temperature sensors

OBJECTIVES OF THE REPORT

• To provide market data on MEMS & sensors for mobile phones: key market metrics & dynamics:

> Unit shipments, revenues and average selling price by type of MEMS & sensors

>Market shares with detailed breakdown for each player

• To provide application focus on key sensors that are changing the mobile phone industry: new features, technical roadmap, insight about future technology trends & challenges:

> Packaging roadmaps (size of the sensors)

> Integration roadmaps (multi-sensors, integration of processing…)

> Performance roadmaps with functionalities (e.g. for gyroscopes: from current devices used for stabilization, gaming and user interface to very low-drift gyroscopes used for true pedestrian navigation)

• To provide a deep understanding of MEMS & sensors value chain, infrastructure & players for the handset business:

> Exhaustive list of players for each device under consideration

> Analysis on who are the key suppliers and emerging players to be considered

> What business model is the most successful and how will it evolve?

WHO SHOULD BUY THE REPORT?

• MEMS & sensors suppliers

> Evaluate market potential of future technologies and products for new applicative markets

> Understand the differentiated value of your products and technologies in this market

> Identify new business opportunities and partners

> Monitor and benchmark your competitor’s advancements

• R&D centers

> Evaluate market potential of future technologies and products for new applicative markets

> Identify the best candidates for technology transfer

• MEMS & packaging foundries

> Understand what are the applications that will drive the volumes in 2015

> Identify new business opportunities and prospects

• Mixed-signal companies & ASIC manufacturers

> Spot new opportunities and define diversification strategies

• Mobile phone OEMs

> Evaluate market potential of future technologies and products for new applicative markets

> Screen potential new suppliers for introducing disruptive features such as low-drift gyroscopes and IMUs, secondary microphones, MEMS oscillator, tunable RF components…

> Evaluate the benefits of using these new technologies in your end system

• Network operators

> Understand what will be the future services that can be offered by taking benefit on the new sensors

• Financial & strategic investors

> Understand the potential of new devices & MEMS technologies such as gyroscopes, RF switches, oscillators, speakers…

> Get the list of main key players & emerging start-ups of this industry

Introduction, Definitions & Methodology 3

Executive Summary 14

1. Mobile Phone Market Overview 28

2. MEMS & Sensors for Mobile Phones: 2009-2015 Market Overview 35

3. Supply Chain Analysis 52

• Business Models of Device Suppliers

• Strategy of the key MEMS players

4. Motivation to Integrate MEMS Devices and Market Dynamics 68

5. Motion Sensors and Pressure Sensors 74

• Overview

• MEMS Accelerometers

• MEMS Gyroscopes

• Electronic Compass

• Inertial Measurement Units & Other Motion SensorClusters

• Pressure Sensors

6. RF Devices 147

• Analysis: Evolution of the Radio Front-End Module

• BAW Filters and Duplexers

• MEMS Switches and Variable Capacitors

• Silicon MEMS Oscillators

7. Silicon Microphones 207

8. Optical MEMS for Display and Projection 234

• Micromirrors for Picoprojectors

• Microdisplays

9. CMOS Image sensors and MEMS Auto Focus 261

• CMOS Image Sensors

• MEMS AF & Microzoom

10. Emerging sensors for Mobile Phones 291

• Ambient Light Sensors & Proximity Sensors

• Energy harvesting

• Micro fuel cells

• Microspeakers

• Fingerprint sensors

• RFID

• Environmental and biologic sensors: temperature, humidity, gas…

Conclusion 329