Power Electronics

Consolidation Trend in Power Management IC Market

The power supply and power management integrated circuit (IC) market has undergone considerable change over the last three years with regard to the supplier landscape. In 1999 and 2000, 15 spin-offs, acquisitions, or mergers took place specifically relating to power supply and power management ICs. Only four such transactions occurred in 2001: Maxim and Dallas, Vishay and General Semi, Fairchild and Impala Linear, and Microchip and TelCom Semi. With Intersil’s acquisition of Elantec in 2002, only 90 power supply and power management IC suppliers remain worldwide.

According to recent analysis by Venture Development Corp. (VDC), the trend toward consolidation is also exhibited in changing market shares among the top players. In 1998, the top five power supply and power management suppliers accounted for 35% of the marketplace. After the flurry of acquisitions/mergers in 1999-2000, this figure rose to more than 40%, demonstrating industry consolidation. However, this figure decreased to 37% in 2001, as many of the larger players struggled in a down economy. Although a definitive industry trend towards consolidation exists, 2001 represented a minor setback. The following firms are ranked by global revenues for power supply and power management ICs.

Top Ranked Power Management IC Vendors:

  1. Texas Instruments
  2. Linear Technology
  3. National Semiconductor
  4. ON Semiconductor
  5. Fairchild Semiconductor
  6. ST Microelectronics

The presence of Texas Instruments, Linear Technology, National, ON Semi, and Fairchild Semi in the top five is not surprising, because these firms are well-established in this market. Texas Instruments, National, ON Semi, and Fairchild are broad-line semiconductor suppliers. Power supply and power management ICs are a natural subset of their product lines, and these benefit greatly from their firms' vast resources in this industry. Power supply and power management ICs represent no more than 25% of their corporate revenues. Linear Technology, while not as large, possesses strong commitments to these products as an important part of its business (more than 50% of corporate revenues). All five of these firms offer a full complement of products in most or all of the power supply and power management IC product categories.

In 1998, the top five vendors were National, Motorola (now ON Semi), Linear, Sanken, and Maxim. Acquisitions and mergers have played a major role in the shift in vendor shares, specifically the TI/Unitrode and the Fairchild/Samsung acquisitions.

In addition to those listed, there are more than 60 vendors with less than 1% market share. Despite the fact that there are approximately 90 participants in this market, the top eight vendors account for more than 50% of the global merchant shipments of these ICs. In fact, the 80/20 rule accurately applies to this market, with 79.6% of 2001 revenues attributed to the top 20% (18 suppliers) of IC manufacturers.

For more information on this study, visit www.vdc-corp.com/power/annual/01/br01-20.html or www.vdc-corp.com.

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