According to the market research group, demand for semi-conducting GaAs bulk substrates from photovoltaic markets has the potential to grow at a CAAGR (compound annual average growth rate) of 79 percent through 2012, representing over 20 percent of demand.

In the short term, Strategy Analytics (Milton Keynes, England) suggests LEDs will continue to represent the largest end market for SC GaAs bulk substrates, accounting for 39 percent of demand.

Overall, the merchant market for SC GaAs bulk substrates is expected to grow at a CAAGR rate of 7 percent through 2012 in terms of area.

"Mitsubishi Chemical, Sumitomo Electric Industries and Hitachi Cable are the market leaders," noted Asif Anwar, Director of Strategy Analytics' GaAs service. "Collectively, the Japanese leaders accounted for over 64 percent of the total market. Other significant suppliers in 2007 in rank order included AXT, Dowa, Freiberger Compound Materials and Neosemitech."

The researchers also note that the merchant market represented 88 percent of total output in 2007 with the Japanese suppliers accounting for the captive demand. They also suggest three- and four-inch material accounted for 70 percent of wafer output in 2007 and the market for larger diameter material will continue through 2012.

Separately, Strategy Analytics has released the results of its annual GaAs bulk and epitaxial vendor ratings and customer satisfaction survey, and suggests that no one substrate supplier was rated highly enough to be able to satisfy both the technical and commercial requirements of end users.

VPEC, Kopin and IQE were found to lead GaAs epitaxial wafer customer satisfaction on price, lead time, delivery and responsiveness to complaints. Meanwhile, Hitachi Cable had the highest satisfaction rating for technical parameters especially those related to wafer and lot uniformity.

Commenting on bulk wafer suppliers, Anwar said: "AXT has steadily increased its customer satisfaction ratings over the past few years. In 2007, bulk substrate users rated AXT on a par with Hitachi Cable and FCM who have traditionally led the Strategy Analytics customer satisfaction ratings."

The survey reveals that IQE and Kopin are competing strongly for customer satisfaction on commercial parameters such as lead time, delivery and response to complaints; that AXT's bulk substrates were rated alongside FCM for technical parameters, beating both Japanese majors, Hitachi Cable and SEI (Sumitomo Electric Industries); and that despite high profile relationships with leading GaAs device and GaAs epitaxial wafer producers, SEI continues to be rated poorly by other customers.

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