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ICs still in growth phase, says expert

Posted by iNext - 2006-01-11

HALF MOON BAY, Calif. — Contrary to popular belief, the semiconductor business is still in the growth phase, according to an economist at Air Products and Chemicals Inc. on Monday (Jan. 9).

For some time, many industry analysts have said the semiconductor industry is maturing. The compound annual growth rate for the IC industry is expected to slow to about 10 percent from 2005 to 2008, according to the Semiconductor Industry Association.

One expert disagreed, saying there is little or no evidence that the IC industry is maturing. “We may be still in a growth phase,” said Duncan Meldrum, chief economist for Air Products, a supplier of gases and materials for the semiconductor industry. “We can’t conclude we’re in a mature phase.”

During a presentation at the Industry Strategy Symposium (ISS) event here, Meldrum compared the “life cycles” of the semiconductor industry to that of the automotive, steel, tire and other businesses.

There are striking similarities between the steel and semiconductor industries in terms of the overall growth curves. The economist dropped hints that the semiconductor growth cycle would last longer than steel, which matured in the 1906-to-1910 time frame after decades of growth.

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