IoT driven semiconductor industry consolidation is reflecting into a highly dynamic Advanced Packaging landscape. Demand for advanced packaging and market size is increasing.
Focus is turning to integration and wafer level packages to enable a functionality driven roadmap and revive the cost/performance curve
A transformation of the semiconductor industry is under way – advanced packaging is part of the scaling and functionality roadmaps
The latest events in the technology market indicate that 2015 marks the beginning of an exciting new era for the IT and electronics industry. At semiconductor supply chain level, the industry entered a profound consolidation phase with high M&A activity reshaping the business landscape. Front-End-of-Line device scaling and related cost reduction are deviating from the path they followed for the past few decades, with Moore’s law in its foundation. Advanced nodes do not bring the desired cost benefit anymore and R&D investments in new lithography solutions and devices below 10nm nodes are rising substantially. As the smartphone market matures, new forces are appearing in the form of the Internet of Things (IoT). While the mobile sector continues to drive the market, the scent of IoT is already spreading in the consumer sector with products such as wearables and first smart home appliances. IoT market, application and technology segmentation has begun. Companies across the industry are restructuring, merging and acquiring in order to adjust their portfolio, enable a complete platform offer and establish leading positions on the market.
At the level of technology, as profitability of FEOL scaling options remains uncertain and IoT promises application diversification, the spotlight is now turning to advanced packages for:
- Cost reduction
- Performance boost
- Functional integration
In order to answer market demands, the advanced packaging segment focuses on integration and wafer level packages (WLP). Emerging packages such as Fan-Out WLP, 2.5D/3D IC and related System-in-Package solutions aim to bridge the gap and revive the cost/performance curve.
How will the advanced packaging industry evolve, which changes in the semiconductor supply chain are taking place and which packaging technologies will be most critical in the years to come? In this report, Yole Developpement (Yole) brings a thorough analysis of the advanced packaging industry and its future development covering platforms Fan-Out WLP, Fan-In WLP, Flip Chip and 2.5D / 3D.
Advanced Packaging will reach 44% of packaging services and a revenue of $30B by 2020
According to Yole Développement estimates, advanced packaging services revenue will increase by $9.8B from 2014 to 2020 at a CAGR of 7%, in majority due to high volume adoption of Fan-Out WLP, 2.5D / 3D and evolution and growth of Fan-In WLP and Flip-Chip. Advanced packages currently account for 38% of all packaging services or $20.2B and are expected to grow share to 44% and $30B by 2020.
The mobile sector remains the main advanced packaging market with smartphones and tablets as end products. Other high volume applications include servers, PC, game stations, HDD/USB, WiFi hardware, base stations, TVs and set top boxes. The scent of IoT is spreading with first products already on the market in the form of wearables and smart home appliances. Further early stage investments are made in sectors such as smart cities, connected cars, various industrial devices and medical applications.
The Flip-Chip platform represents a large mature market and leads in packaging services revenue and wafer count. Fan-In WLP leads in unit count due to small size compared to demanded volume. Adoption of wafer level packages continues. Teardowns performed by Yole and its sister company, System Plus Consulting on 3 high end smartphones (iPhone 6+, Samsung Galaxy S6 and Huawei Ascend Mate 7) indicated a high penetration rate of WLP, 30% on average. Fan-Out WLP is expected to make a major breakthrough within the next year, likely led by TSMC inFO PoP and followed by other Fan-Out multi die solutions. Long term, a bright future lies ahead for wafer level packages with respect to IoT requirements as they are well position to answer related cost, form and functional integration demands. When it comes to advanced feature sizes, a competitive sub 10 µm / 10 µm arena is established where organic wafer level packages aggressively compete with advanced organic Flip-Chip substrates and 2.5D / 3D Si/glass interposers.
As WLP pin counts grow, thicknesses and overall cost decrease, the evolution of Fan-In WLP and in particular a breakthrough of Fan-Out WLP are expected to result in a takeover of a part of the Flip Chip market. With the breakthrough of Fan-Out WLP, the packaging landscape might drastically change, with an IDM and foundry leading all packaging services by wafer count.
A full analysis is available in the report including revenue, wafer and unit forecasts per advanced packaging platform and production breakdown by device type such as analog/mixed signal, wireless/RF, logic and memory, CMOS image sensors, MEMS, LED and LCD display drivers.
Advanced Packaging supply chain – the end of OSATs as we know today?
The semiconductor industry worth $335B in annual revenue is the spine of the mobile sector and is now transforming itself to be the hardware enabler of the IoT age. Due to cost pressures and portfolio completion, high M&A activity is in progress with record breaking deals and a whopping $120B already spent in 2015 alone - more than the last 10 years combined! How is the semiconductor business landscape and in particular advanced packaging landscape changing, who are the leaders, what is their activity by packaging platform and are IDMs and foundries taking over advanced packaging? Get the thorough analysis in this report!
Furthermore, this report brings a financial analysis with insight into gross margins, R&D expenses, net incomes and related industry segmentation. Advanced packages are also segmented by package features such as pin count, pitch, thickness, footprint, price with included analysis of their feature trends. A specialized section is dedicated to the breakthrough of Fan-Out WLP with revenue, wafer and unit forecasts until 2020 and high volume adoption of the 2.5 / 3D platform.
The advanced packaging industry is facing complex market and technology transformations, but is propelled by strong drivers perpetually increasing demand. With advanced packaging platforms still building on the smartphone market and new IoT driven applications on the horizon, leftover capacity in 2014 is forecasted to be exceeded by 6 times by 2020! Regarding wafer size, majority of advanced packages are still processed on 200 mm wafers, however, if total wafer surface is taken into account, processing on 300 mm wafers is dominant.
Objectives of the Report
To provide a high level market overview of the Advanced Packaging landscape
- Identify Advanced Packaging drivers and trends
- Current status and forecasts until 2020: Revenue, wafer count, unit count
- Identify main players and provide supply chain analysis
- Market shares by business model, wafer size and applications
- Financial insight and related industry segmentation
To provide analysis of technology trends
- Packaging segmentation
- Package feature trends
- Price comparison
To assess the future development of the Advanced Packaging market
- Outlook on potential disruptions: new market drivers, infrastructure, expanding business models, new entries, competing packaging solutions
- Impact on supply chain and technology roadmap