More speed and 3G will boost chip demand, say analysts

date: 22nd January 2001, source: zdnet.co.uk

Microprocessor manufacturers will crack the 2GHz speed barrier and 3G devices will spur on the semiconductor industry in 2001, leading analysts predicted Thursday.

New semiconductor fabrication technologies, including a spray-on polymer and nanofabrication technique will allow manufacturers to look beyond 2GHz, said Steve Leibson, vice president and chief analyst at MicroDesign Resources (MDR), at a MDR awards ceremony in San Jose.

Senior Analyst at MDR Markus Levy said that the emergence of 3G mobile devices, which will deliver broadband Internet services across new wireless networks, will spur on development particularly within the field of Digital Signal Processing (DSP). This is the area of processor manufacturing concerned with turning analogue data, such as audio and video, into digital data.

Other industry watchers agree that 3G will have an impact on this area. "You need more powerful DSPs to do the decoding required for 3G," says Alan Brown, senior analyst at GartnerGroup's European semiconductor research group. "These DSPs are in development, however." Brown mentions other factors affecting the development of 3G including radio frequency and power consumption.

Microprocessor maker Intel was unsurprisingly also the subject of some key forecasts in San Jose. Senior MDR analyst Kevin Krewell said that the Pentium 4 would dominate the market in its class this year and predicted that Intel would be the first manufacturer to reach a 1GHz operating frequency with a mobile microprocessor.

Another key prediction was that the network processors segment would see most growth this year.

These predictions should help to reassure the semiconductor industry that this year will see important progress made. In recent news, analysts said they expected to see less growth in the market during 2001 than had previously been anticipated.

Expected growth slid from 35 percent to 10 percent, in line with an overall slowdown in the technology sector. Leading microprocessor manufacturers Intel and AMD have also both made disappointing revenue announcements.

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