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Led by iPhone & iPad, sales of wireless semiconductors to top PCs in 2011

post #1 of 5
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Sales of CPUs, memory and other semiconductors will be greater for wireless connected devices, like Apple's iPhone and iPad, than for traditional PCs this year, a new analysis has found.

The major market-wide shift, revealed this week by IHS iSuppli, shows that wireless connected devices will become the leading category for semiconductor sales. Sales of semiconductors for wireless devices are expected to further extend their lead over sales for traditional PCs in 2012.

"Led by Apple Inc.'s iPhone and iPad, demand is booming for smart phones and tablet devices," said Wenlie Ye, analyst for semiconductor design and spending at IHS. "This is spurring a surge in sales of semiconductors used in wireless devices, including baseband chips, applications processors and mobile memory. With overall sales growth for PCs slowing, the balance of power in the semiconductor industry is shifting toward the wireless segment."

Original equipment manufacturers are projected to buy $55.4 billion worth of semiconductors for use in wireless devices in 2011. That's an increase of 10.7 percent from the $50.1 billion that were bought in 2010.

Wireless devices are expected to eclipse semiconductor sales for PCs, where 2011 sales are forecast to total $53.1 billion this year. That's just a 1.2 increase from the $52.5 billion sold in 2010.

"Thus, the supremacy of wireless as an OEM semiconductor spending category also is partly a consequence of Apple's domination of hot mobile markets -- and its primacy in the electronics supply chain," the report said. It forecasts Apple to increase its lead in semiconductor purchasing over HP through 2011 and 2012.

IHS said that trends in the semiconductor industry reflect the tremendous success of Apple, which became the world's largest buyer in 2010.

Apple's ascendance to the top dethroned longtime semiconductor leader HP. The report highlighted the major differences between the two companies, as 61 percent of Apple's chip budget in 2010 was on wireless products like the iPhone and iPad, while 82 percent of HP's chip buying was devoted to traditional computers.



The figures from IHS track semiconductor spending on all OEM purchases for mobile devices, including smartphones and tablets like Apple's iPhone and iPad. The category also includes wireless infrastructure gear, like routers and base stations.

The wireless segment is differentiated from the computer segment, where semiconductors in devices like notebooks, desktops and servers are counted. The computer segment does not include chips found in peripherals like hard drives and printers.

IHS said that tablets like Apple's iPad are cannibalizing sales of traditional PCs, partially driving the industry-wide shift toward mobile platforms. Wireless devices are expected to remain the largest source of semiconductor sales for the foreseeable future.

Last October, as many prognosticators reduced their iPad sales predictions in 2011, IHS increased its forecast to 43.7 million units. However, an iPad 2 shortage at launch prompted the research firm to cut its forecast to 39.7 million in April of this year. Last quarter alone, Apple sold a record 9.25 million units of its iPad 2.

In May, IHS also predicted that Apple will continue to dominate the mobile application market for the foreseeable future, representing 76 percent of mobile application sales in 2011. The group expects Apple to retain 60 percent market share by 2014.
post #2 of 5
It's a little clickbait-y to pronouce this as though it is the first time it has happened. Surely the 2008 & 2009 figures also had wireless devices ahead of computers by semi-conductor value?


PS 1st!
post #3 of 5
To me the story wasn't clear regarding modems as wireless devices. Are all ISPs now including wireless connectivity? Mine has for years. My ISP modems only last about a year or so. If others are having the same longevity problems then that must be millions of new modems needed each year.

I've read a report from somebody who is on his third Palm Pre because they just fail after about eight months. He keeps getting them replaced under warranty. His salesman said it is a very common problem with the Pre.

Hand held devices are definitely the future of computing. I'd like to know just how many mobile computing devices are being created relative to home computing devices. Smart phones, tablets, and even laptops could be considered mobile devices, but I wouldn't categorize laptops as hand held devices.

Are hand held devices growing at such a rate and increasing their capabilities that they'll replace conventional computers within five years? I intend to get the next generation iPod Touch or perhaps an iPad and try making it my main computer. I don't do scientific work or engineering so it should be possible and easy to do.
post #4 of 5
Boy, I wish people would stop misusing the term "cannibalizing". Cannibalization is where one product cuts into a companies own similar product line. Not where a product surplants a completey different category. And certainly not when it cuts into someone else's product.
Cannabalization: Eating one's own...
post #5 of 5
Quote:
Originally Posted by isaidso View Post

Boy, I wish people would stop misusing the term "cannibalizing". Cannibalization is where one product cuts into a companies own similar product line. Not where a product surplants a completey different category. And certainly not when it cuts into someone else's product.
Cannabalization: Eating one's own...

Apple has clearly said that it will cannibalize its own products as needed and probably is doing. The declining iPod market is clearly being eaten in part by iPhones and the Mac growth rate my well be higher without the iPad. Your stipulation about it being a similar product line has no bearing and is just your own addition.
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