Photonics (telecom, datacom, LiDAR, sensing and others…) is driving the InP wafer market.
Key features of the report
- Analysis and description of the applicative markets: RF and photonics
- Applicative market dynamics
- Status of InP wafer growth and epi growth technology
- Technical description of InP wafer growth and epi growth technology
- Technical description of InP RF and photonic devices
- Key players, by market and analysis
- Wafer and epiwafer suppliers – Market share
- Wafer and epi wafer market size and market forecast through 2024, in $M and units
Objectives of the report
Determination of InP wafer and epiwafer market dynamics:
- Technical description of InP wafer growth and epi growth technology
- Wafer and epi wafer market size and market forecast, in $M and Munits
- Ecosystem identification and analysis
- Key players, by market
- Main technical challenges
Analysis and description of the markets and technologies involved:
- Technical market segmentation – Two big applicative markets: RF and photonics
- Market trends and forecast
- Technology trends
- Major players worldwide
Table of Contents
Companies cited in this report
Report objectives 10
Executive summary 12
InP applicative markets 51
- InP photonics market
- InP photonics market overview
- Introduction to fiber optic communication
- Telecom market
- Datacom market
- LiDAR market
- Photonic Integrated Circuit (PIC)
- InP photonics supply chain & market forecast
- InP photonics market supply chain overview
- InP wafer market volume for photonic applications
- InP wafer market size for photonic applications
- InP RF
- InP RF applicative market overview
- Automatic test equipment
- Military & defense applications
- InP RF components in fiber-optic communication
- Handset applications
- Wireless transmission
- Other THz applications
- InP RF market forecast and supply chain
- Potential of InP for RF mass market
- Positioning of InP RF applications
- InP substrate volume for RF applications (2017-2024)
- InP substrate market size for RF applications in $M (2017-2024)
- InP RF – Business models
InP wafer market 2019
- Technology & market
- InP wafer ASP ($)
- Total InP substrate volume in units
- Total InP substrate market ($M)
InP epiwafer technology & market 242
- Total InP epiwafer market ($M)
- InP epiwafer suppliers
- Estimated InP epiwafer shares (open market)
InP fabs 257
- Major InP fabs in North America
- Major InP fabs in Europe
- Major InP fabs in Asia
Discussion and conclusions 262
- Where is InP attractive?
- Can InP penetrate larger markets?
DATACOM IS DRIVING THE INP WAFER MARKET
As an old but still gold-standard member of the compound semiconductor family, InP possesses the key advantages of emission and detection capabilities over 1000 nm in the photonics domain, as well as high speed and low noise performance in high-frequency RF applications. Though it is often overshadowed by rivals like GaAs and SiGe for mass-volume, cost-driven RF applications, InP remains a top choice for performance-driven niche markets like military communication, radar, and radiometry, as well as automatic test equipment. Moreover, different industrial actors (i.e. Skyworks, GCS, and IntelliEPI) are monitoring InP technology for the upcoming 5G move.
Currently, the real boost for the InP wafer market is expected in photonic applications. In optical communication, InP offers high performance in many functions including emission, photo detection, modulation, and mixing, but it is often challenged by other semiconductor platforms because of its high cost. Nevertheless, InP is an indispensable building block for laser diodes in transceivers used for telecom and datacom applications. Specific to the cyclic telecom market, which has recently slowed down, massive investment plans from different operators (i.e. China Telecom) are expected with the imminent 5G network. In fact, the InP wafer market for telecom is projected to reach around $53M by 2024. Also, significant investment in the datacom market is expected from different players, led by internet giants Google, Amazon, Alibaba, and more.
With the requirement of more data transfer at higher speeds, transceiver technology is migrating to technology offering better rates (100GbE and 400GbE), for which InP is more favorable. The wafer market for datacom is expected to explode, with an impressive CAGR 2017-2024 of 28%. Last but not least, exciting LiDAR applications could be promising for InP, i.e. enabling eye safety at higher wavelength, which is currently in an early R&D phase.
This report provides an overview of the InP wafer and epi wafer markets’ size and market forecast for two large applicative markets: RF and photonics. Also, Yole Développement (Yole) addresses the 5G network’s impact on the InP RF and photonic wafer markets. Moreover, this report outlines Yole’s understanding of current market dynamics and future evolution, with a technical description of InP wafer and epiwafer growth, and the main challenges.
THE INP INDUSTRY FEATURES LOTS OF PLAYERS AT DEVICE LEVEL, AND A HIGH CONCENTRATION AT EPIWAFER AND WAFER LEVEL
The InP industry has different business models and numerous players. It is worth noting that from wafer to device manufacturing, this market’s concentration level is different. At device level, Yole has identified more than 30 InP foundries and integrated fabs, most of which are currently focused on photonic chips. InP fabs are found globally, from the US to Europe and Asia. The majority of players are integrated fabs for their own products. These fabs have their own epiwafer production capacity or R&D capability, along with an outsourcing division for their epiwafers. There are also InP fabs that purchase epiwafers on the open market. Yole does not expect the outsourcing ratio to evolve quickly in the coming years.
Contrary to the device manufacturing arena, the epiwafer open market is heavily concentrated. Landmark is the leader, focused on photonic applications. IQE also plays a key role with products covering photonics and RF applications.
When we observe wafer level, we see that it mirrors the epiwafer market in terms of concentration. More than 80% of market share is held by two firms: Sumitomo Electric Industries (SEI) and AXT Inc. JX Nippon Group occupies third place in terms of wafer sales. Other players are either in pilot-line production and only delivering small wafer volumes, or still in the R&D stages.
This report furnishes an overview of the InP industry playing field, covering wafer, epiwafer, foundry, and IDM players. Also outlined is Yole’s understanding of the market’s current dynamics and future evolution, covering technical and economic aspects.
IF CHALLENGED BY SILICON PHOTONICS, WHAT WOULD THE FUTURE LOOK LIKE FOR INP-BASED PHOTONIC IC?
Photonic IC (PIC) is not a new concept. It was first introduced in 1969, and since then different PIC platforms like InP, silicon photonics, and polymer have been studied and developed. InP-based PIC is widely studied, since it allows emission at wavelengths > 1000 nm, corresponding to several windows of optical fibers and also being necessary for some other applications. During our discussion with industry players about market data, Yole’s analysts found that there are questions concerning the definition of monolithic InP PIC. In the extreme, EML (Electro-absorption Modulated Laser) is already monolithic. In fact, it all depends on level of integration. Although different building blocks – passive components, polarization components, phase modulator, laser, detector, and others have been demonstrated with InP – commercially-available, fully-integrated InP products are still limited.
In recent years, InP PIC has faced strong competition from silicon photonics, where industrial players like Intel have heavily invested. Indeed, when comparing Si photonics and InP PIC, it is hard to dispute Si photonics’ cost advantage for large-volume applications, due to large, higher-quality Si wafers. But though InP has faced (and will continue to face) strong competition from other materials for photonic applications, InP’s direct bandgap makes it unique for laser diode applications. Thus, we believe InP laser devices will exist for a long time, at least for active optoelectronic devices. Moreover, InP PIC makes sense for small-volume markets, addressing diverse applications such as medical, high-end LiDAR, and sensing, as well as optical communication. Players in these areas are likely to capitalize on the existing telecom/datacom supply chain for ramping up.
This report establishes Yole Développement’s understanding of InP PIC technology’s maturity, and its applicative potential.
Aixtron, Alibaba, AXT, DXT Shenzen, Duet Microelectronics, Ericsson, Facebook, FBH, Finisar, GCS, Google, Huawei, II-VI Epiworks, IntelliEPI, IQE, InPact, JX Nippon, Keysight, Landmark, Low Noise Factory, Lumentum, Masimo, Microsoft, Northrop Grumman, NTT, Sanan IC, Sumitomo Electric, Teledyne, Veeco, VPEC, Wafer Technologies, Win Semiconductor, Yunnan Germanium, and more
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