SAN FRANCISCO—At least 50 companies are now playing in the MEMS foundry market, a highly fragmented and competitive segment that has become critical to the MEMS industry, according to a new report by French market research consultancy Yole Development.
Major open MEMS foundries are now profitable and most are moving to upgrade to 8-inch production lines, according to Yole. But growth in consumer applications and other high-potential market opportunities have attracted new entrants in the market, coming from the mainstream semiconductor industry, according to Yole (Lyon, France).
These new entrants are able to leverage high-volume production lines combining CMOS technology and MEMS, Yole said, setting the stage for a heated competition between established MEMS foundries and newer players.
"While the foundry business experienced a booming 22 percent growth to reach $480 million in 2008, MEMS foundries do not expect more than single digit revenue increase for 2009 with low visibility on bookings," said Jerome Mouly, a Yole analyst, in a statement.
The largest markets for MEMS foundries are inkjet printheads, using mainly exclusive foundry providers, according to Yole. But open foundries are developing innovative platforms addressing new applications like RFMEMS or microphones and developing different approaches, according to the firm.
MEMS market share captured by foundries is increasing for most products because the structure
of the MEMS industry is stabilizing, Yole said, with emerging MEMS companies choosing fabless
or fablite business models and sharing the production risks of new products with the MEMS foundries.
According to Yole's report, "MEMS Foundries 2009," this increased competition means that decisions made today will have a major impact on the survival prospects of MEMS foundries. MEMS foundries to need to solidify their business models and solidify their offerings in order to ensure long-term success, according to Yole.
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