A market report from Frost & Sullivan projects that revenue in the power management IC market will grow from $5,833.3 million in 2004 to $12,638.2 million in 2008. According to analysis presented in “World Power Management ICs Market,” the rapid growth of the power management IC market is primarily due to expanding applications in increasingly popular portable products such as cellphones, notebooks, and digital camera, which have greater power requirements.
"Along with portable products, consumer preference is also veering toward feature-rich products like mobile phones that integrate numerous functionalities such as digital camera, Internet access, multimedia features, global positioning system (GPS), and so on. Highly integrated products are becoming the order of the day and are one of the primary driving forces for the market today," notes Frost & Sullivan Research Analyst Vinoth Praveen Premkumar.
Such sophisticated devices need complex power management ICs to satisfy their power requirements of multiple supply voltages, high currents and reducing voltage levels. While this is good news for power management IC manufacturers, the need to satisfy these requirements at low prices poses a strong challenge to them.
Increasing price pressure is the result of declining prices of end-use products due to immense competition among original equipment manufacturers (OEMs). This, in turn, forces power management IC manufacturers to reduce prices and decreases their chances of earning good margins, despite growing end-use requirements and rising unit shipments.
To address this problem, manufacturers develop low-cost manufacturing processes and shift their production facilities to attractive destinations such as Asia, and particularly, China. This strategic move also helps them capitalize on the spiraling sales of consumer electronics - especially of portable products - in Asia.
Apart from the price pressure, manufacturers need to address the power requirements of integrated products such as cellphones, which incorporate multiple functions requiring different supply voltages and currents. While manufacturers are able to offer distinct solutions to address growing integration, the real challenge lies in satisfying consumer demand for compact products through smaller form factors.
The introduction of certain lead-free programs and energy efficiency regulations in both Europe and the United States is another significant challenge facing power management ICs manufacturers. Directives such as the Restriction of Hazardous Substances (RoHS) and the Waste Electrical and Electronic Equipment (WEEE) restrict the use of substances such as lead in electrical and electronic products.
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World Power Management ICs Market provides an in-depth analysis of the power management ICs market and each of its five broad product categories: switching (AC-DC & DC-DC), voltage regulators and references, integrated application specific standard products (ASSP) power management ICs, motor control ICs, and battery management ICs. The detailed analysis provided for each segment includes market revenue, unit shipment, and growth rates from 2002-2008.