LONDON — Merchant demand for four-inch GaAs bulk wafers will decline by over 20 percent by 2009, with demand shifting to six-inch material, according to market research group Strategy Analytics, which also suggests six-inch substrates will account for 76 percent of total market revenues in 2012, up from 63 percent last year.

In a report on the semi-insulating (SI) GaAs bulk substrates sector, Strategy Analytics estimates demand increased by 5 percent year-on-year in 2007 with demand for GaAs devices driven primarily by cellular handset and other wireless markets. It suggests SI GaAs substrate demand will grow at a CAAGR (compound annual average growth rate) of 5 percent, with merchant demand accounting for 95 percent by 2012.

"Industry consolidation over the past 12 to 18 months will mean that customers for bulk substrates will have greater buying power," observes Stephen Entwistle, VP of the Strategic Technologies Practice. "It will be even more important for the bulk substrate suppliers to develop and maintain strategic relationships with major users such as IQE, Kopin, RFMD, Skyworks and TriQuint."

Strategy Analytics is forecasting that year-on-year substrate demand will grow 7 percent this year, increasing to 9 percent for 2009, "but demand for bulk substrates will vary by growth technology," predicts Asif Anwar, Director of the GaAs service at Strategy Analytics.

"In addition to the move to six-inch diameters, overall demand for SI GaAs bulk substrates is driven by HBT (Heterojunction Bipolar Transistor) device production, which will ensure dominance of VGF (Vertical Gradient Freeze) and VB (Vertical Bridgman) substrates. This also means that demand for LEC (Liquid Encapsulation Czochralski) bulk substrates will decline for the period through 2012."

In a separate report, Strategy Analytics suggests all the major tier one automotive systems companies are moving to silicon technologies for their next generation radar platforms, gradually decreasing reliance on GaAs.

The researchers also see the total market demand for RF millimeter-wave components will grow at CAAGR of 44 percent through 2012.

GaAs technology is seen as being supplanted by CMOS and SiGe technologies for use in both long-range and short-range automotive radar systems, with silicon technologies potentially dominating this market from 2013 onwards.

Strategy Analytics predicts that the CMOS and SiGe-based automotive radar systems will account for 20-40 percent of the market over the 2009-2012 timeframe, followed by another potential shift beginning in 2013.

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