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April 9, 2003 RELEASE

Release

32-bit MCU Growth Explosive Amid Steady MCU Market

Scottsdale, Arizona --- April 9, 2003 --- Bolstered by strong growth in the 32-bit segment, overall sales of microcontrollers (MCUs) are expected to rise 11 percent in 2003 according to a forecast published in IC Insights’ 2003 McClean Report. Total MCU unit shipments are expected to jump 7 percent and overall average selling price is forecast to increase 4 percent, resulting in the 11 percent overall MCU market growth (Figure 1). Steady sales of automobiles, home appliances and electronics, and consumer electronics will keep the market for MCUs very active throughout 2003.

Figure 1

The fastest growing portion of the MCU market continues to be the 32-bit MCU segment. IC Insights forecasts that increasing sophistication of end-use platforms such as the automobile, Internet-capable cell phones, PDAs, printers, digital still cameras, digital video cameras, high-speed modems, and other applications will drive this market segment to grow 30 percent in 2003 and 38 percent in 2004. Most leading MCU vendors have adjusted their portfolios to provide a seamless upgrade from 8- and 16-bit MCUs to 32-bit devices.

While many designers are being drawn to upgrade to 32-bit or 16-bit MCUs, the 8-bit MCU market remains very active. Though not reflected in bigger dollar volume, the fact remains that vendors such as TI (TMS370 family), Motorola (Nitron family), NEC (78K0 family), Microchip Technology (microPIC family), and Zilog (Z8 Encore! family) have strengthened their efforts in this competitive arena during the past year. Low cost ($0.50 to $5.00), yet very functional 8-bit devices can be found in applications ranging from give-away toys at fast food restaurants to the BMW 745i luxury sedan to space-based platforms.

Today, MCUs of all sizes increasingly offer more features and better performance such as flash memory, low power (1.8V) options, and small packages that integrate functions such as A/D converter and memory onto a single chip. Rewriteable flash memory allows manufacturers to program MCUs just before they ship. Last minute and in-system programming changes can take place with no increase in lead times. While on-board flash is about 20 percent more expensive than mask ROM, it saves money at the back end with fewer faulty chips.

More details on MCU market segments and MCU applications can be found in The McClean Report 2003 and Emerging IC Markets 2003, respectively.

About IC Insights

IC Insights, Inc., based in Scottsdale, Arizona, is dedicated to providing high-quality, cost-effective market research for the integrated circuit industry. Founded in 1997, IC Insights offers coverage of global economic trends, IC market forecasts, capital spending and fab capacity trends, product market details, and technology trends, as well as complete IC company profiles and evaluations of emerging markets for ICs.