Communication Integrated Circuits Market Size
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 157.72 Billion |
| Market Size (2029) | USD 239.92 Billion |
| CAGR (2024 - 2029) | 8.75 % |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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Communication Integrated Circuits Market Analysis
The Communication Integrated Circuits Market size is estimated at USD 157.72 billion in 2024, and is expected to reach USD 239.92 billion by 2029, growing at a CAGR of 8.75% during the forecast period (2024-2029).
- Communication integrated circuits are specialized components utilized in various telecommunication electronic systems, facilitating the transmission, reception, and analysis of data and signals.
- The advancement of integrated circuits has significantly decreased the size, increased the speed, and lowered the cost of computing, thereby facilitating the emergence of compact, portable devices. This progress has contributed to enhancements in processing capabilities, which are in line with Moore's Law, promoted the evolution of digital technologies, and made possible the development of more sophisticated software applications.
- The rising need for data centers is driving an upsurge in the demand for communication ICs. Presently, substantial data center initiatives in North America have led to a robust demand for memory ICs, particularly DRAM. Nevertheless, when evaluating data center space per user, it is projected that China's internet data centers will expand to at least 22 times the capacity of those in the United States or at least 10 times the existing space in Japan. Consequently, DRAM presents a considerable growth opportunity, thereby significantly influencing the communication ICs market.
- Furthermore, several regional governments are actively promoting the adoption of wireless communication technologies, thereby facilitating the expansion of communication ICs. For instance, in May 2024, the National Telecommunications and Information Administration (NTIA), part of the Department of Commerce, announced its intention to allocate a significant sum of USD 420 million for the advancement of radio equipment.
- This funding is specifically designated to enhance the implementation of open networks, both in the United States and internationally. This initiative represents the second Notice of Funding Opportunity (NOFO) issued by the Public Wireless Supply Chain Innovation Fund. The main objective of this NOFO is to stimulate commercialization and encourage innovation in the field of open radio units.
- The growing adoption of 5G worldwide is expected to support market growth. In October 2023, Vodafone Idea announced that it would make significant investments in the deployment of 5G networks as well as expand 4G coverage across India. This commitment, which the company made in line with its determination to promote the government's vision through initiatives such as OpenRAN, has been disclosed at the 7th India Mobile Congress.
- Adding to this, it is anticipated that telecommunications companies and mobile operators are expected to make investments worth more than USD 600 billion in 5G infrastructure. These investment prospects are expected to fuel market growth for communication ICs over the forecast period.
- The advancement and miniaturization of integrated circuits (ICs) have resulted in more complex manufacturing processes. This increased complexity often leads to elevated failure rates during both production and testing stages, negatively impacting yields and overall expenses. Additionally, the design of ICs typically relies on a web of patents and intellectual property rights, adding another layer of intricacy. Organizations must adeptly navigate the risks related to patent infringement and possible legal disputes, as poor management of these matters can severely obstruct market entry and stifle innovation.
- The macroeconomic factors, such as fluctuations in exchange rates and international trade dynamics, might impact the global communication integrated circuits market. Changes in currency values can affect the cost of imported IC products and raw materials, influencing pricing and profitability for IC manufacturers and distributors. Additionally, trade policies, tariffs, and trade agreements can impact the availability and cost of integrated circuits, especially for countries heavily dependent on imports or exports.
Communication Integrated Circuits Market Trends
Logic IC Segment is Expected to Hold Significant Market Share
- The swift progress in communication technologies, including 5G, the Internet of Things (IoT), and edge computing, is propelling the need for logic integrated circuits (ICs) in the communication industry.
- These ICs are essential for facilitating effective communication, data transfer, and network connectivity. There is a significant demand for logic ICs tailored for high-speed interconnections, wireless communication standards, and network infrastructure to accommodate the growing data rates, minimal latency, and extensive connectivity needs of contemporary communication systems.
- In addition, demand for logic ICs is driven by the proliferation of machine learning and artificial intelligence technologies in various applications such as natural language processing, image recognition, or predictive analytics. These ICs are essential for accelerating AI model inference, optimizing neural network algorithms, and facilitating efficient data processing in AI-enabled devices and systems. As AI and ML continue to advance, logic ICs capable of efficient and high-performance computation will be increasingly in demand.
- Moreover, owing to the digitalization of corporate business practices and increased streaming and internet usage, the demand for data is growing. Additionally, the rapid growth of cloud computing drives considerable investments in data center infrastructure.
- According to the global SWF, data centers accounted for one-third of global government investment in digital infrastructure as of 2023. This initiative concurrently will drive the market for logic ICs as data centers require powerful logic ICs to handle large-scale data processing, storage, and management tasks. Additionally, these are designed for energy efficiency and are sought after to optimize power consumption in data centers and cloud computing environments.
China is Expected to be the Fastest-growing Region in the Market
- Artificial intelligence, advanced wireless networks, and quantum computing such as 5G are also opening up new frontiers of communication ICs demand in China. For instance, as per GSMA, 5G will become the lead network technology in China by 2025. As the demand for high-performance computing devices accelerates, the rollout of 5G networks is keeping pace, with integrated circuits (ICs) playing a pivotal role.
- Furthermore, the expansion of the communication integrated circuit market within the country is being propelled by the integration of cloud technology, the rising establishment of data centers, and the progress of 5G technology. According to data provided by Sppedtest by Ookla and GSMA, in the first half of 2023, Hong Kong was the leading country in terms of 5G availability (42.3%), followed by countries such as Australia, South Korea, Thailand, and the Philippines.
- Similarly, as of October 2023, China boasted around 3.22 million 5G base stations, accounting for 28.1% of the nation's total cellular base stations. With 5G swiftly cementing its role as a pivotal player in the communication sector and streamlining data transfers across the manufacturing ecosystem, these infrastructural strides are set to propel the country's market growth.
- In addition, the growing cloud and data center market in the region is expected to drive the demand in the communication ICs market. As reported by Cloudscene, as of September 2023, China had 448 data centers, surpassing all other countries in Asia-Pacific. Furthermore, China ranked fourth globally in terms of the total number of data centers during the same month.
- Moreover, the country is also witnessing an increase in the construction of data centers, further creating demand for communication ICs. For instance, in August 2024, Equinix, Inc. declared an initial investment of USD 124 million for the development of its specialized International Business Exchange (IBX) data center located in Hong Kong. Designated as HK6, this facility will be linked to Equinix's five pre-existing data centers, which function as a central point for data and economic interactions among multinational corporations and local and mainland Chinese businesses within the Greater Bay Area (GBA).
Communication Integrated Circuits Industry Overview
The communication integrated circuits market is fragmented and consists of various players. The market players adopt various strategies such as strategic partnerships, mergers and acquisitions, product innovations, and market expansions to stay ahead of the competition. Some of the key players include Texas Instruments Inc., Analog Devices Inc., Infineon Technologies AG, STMicroelectronics NV, and Microchip Technology Inc.
- In June 2024, Magnachip Mixed-Signal Ltd announced the launch of a versatile power management integrated circuit (PMIC) along with a multi-channel level shifter designed to manage various voltages and signals in display panels for IT devices.
- In April 2024, Samsung Electronics Co. Ltd announced the development of the first LPDDR5X DRAM in the industry, which offers an impressive performance of up to 10.7 gigabits per second (Gbps). Utilizing 12 nanometer (nm)-class process technology, Samsung has produced the smallest chip size available among current LPDDR offerings, thereby reinforcing its position as a leader in the low-power DRAM sector.
Communication Integrated Circuits Market Leaders
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Texas Instruments Inc
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Analog Devices Inc
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Infineon Technologies AG
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STMicroelectronics N.V.
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Microchip Technology Inc
*Disclaimer: Major Players sorted in no particular order
Communication Integrated Circuits Market News
- March 2024: Toshiba added eight new products with 512 KB/1 MB flash memory capacity and four types of packages to the M4K Group of the TXZ+ Family Advanced Class 32-bit microcontrollers equipped with Cortex-M4 core with FPU. The new products expand code flash memory capacity from the 256 kb maximum of Toshiba’s current product to 512 KB/1 MB, depending on the product, and RAM capacity from 24 KB to 64 KB.
- January 2024: NXP Semiconductors introduced the MCX A14x and MCX A15x, marking the inaugural families in the versatile A Series of the MCX portfolio, which are now available for purchase. These new MCX A series microcontrollers are designed to empower engineers by providing a cost-effective, user-friendly solution with a compact footprint.
Communication Integrated Circuits Market Report - Table of Contents
1. INTRODUCTION
- 1.1 Study Assumption and Market Definition
- 1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
- 4.1 Market Overview
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4.2 Industry Attractiveness - Porter's Five Forces Analysis
- 4.2.1 Bargaining Power of Suppliers
- 4.2.2 Bargaining Power of Consumers
- 4.2.3 Threat of New Entrants
- 4.2.4 Threat of Substitute Products
- 4.2.5 Intensity of Competitive Rivalry
- 4.3 Industry Value Chain Analysis
- 4.4 Impact of COVID-19 Aftereffects and Other Macroeconomic Factors on the Market
5. MARKET DYNAMICS
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5.1 Market Drivers
- 5.1.1 The Rising Need for High-Band Connectivity Services will Support the Market Growth
- 5.1.2 Increasing Deployment of 5G Across the World
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5.2 Market Challenges
- 5.2.1 Complex Fabrication Process owing to the Decreasing Chip Size
6. MARKET SEGMENTATION
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6.1 By Type
- 6.1.1 Analog IC
- 6.1.2 Logic IC
- 6.1.3 Memory
- 6.1.4 Micro
- 6.1.4.1 Microprocessors (MPU)
- 6.1.4.2 Microcontrollers (MCU)
- 6.1.4.3 Digital Signal Processors
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6.2 By Geography***
- 6.2.1 United States
- 6.2.2 Europe
- 6.2.3 Japan
- 6.2.4 China
- 6.2.5 South Korea
- 6.2.6 Taiwan
7. COMPETITIVE LANDSCAPE
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7.1 Company Profiles*
- 7.1.1 Intel Corporation
- 7.1.2 Texas Instruments Inc.
- 7.1.3 Analog Devices Inc.
- 7.1.4 Infineon Technologies AG
- 7.1.5 STMicroelectronics NV
- 7.1.6 NXP Semiconductors NV
- 7.1.7 On Semiconductor Corporation
- 7.1.8 Microchip Technology Inc.
- 7.1.9 Renesas Electronics Corporation
- 7.1.10 MediaTek Inc.
8. INVESTMENT ANALYSIS
9. FUTURE OF THE MARKET
** Subject To AvailablityCommunication Integrated Circuits Industry Segmentation
Integrated circuits (ICs) serve as the essential building blocks of electronic devices, consisting of a network of interconnected transistors, resistors, and capacitors. These elements are meticulously constructed on a thin layer of semiconductor material, usually silicon, resulting in a compact chip or wafer.
The study tracks the revenue accrued through the sale of communication ICs by various players in the global market. The study also tracks the key market parameters, underlying growth influencers, and major vendors operating in the industry, which supports the market estimations and growth rates over the forecast period. The study further analyses the overall impact of COVID-19 aftereffects and other macroeconomic factors on the market. The report’s scope encompasses market sizing and forecasts for the various market segments.
The communication integrated circuits market is segmented by type (analog IC, logic IC, memory, and micro [microprocessors, microcontrollers, and digital signal processors]) and geography (United States, Europe, Japan, China, Korea, Taiwan, and Rest of the World). The market sizes and forecasts are provided in terms of value (USD) for all the above segments.
| By Type | Analog IC | |
| Logic IC | ||
| Memory | ||
| Micro | Microprocessors (MPU) | |
| Microcontrollers (MCU) | ||
| Digital Signal Processors | ||
| By Geography*** | United States | |
| Europe | ||
| Japan | ||
| China | ||
| South Korea | ||
| Taiwan |
Communication Integrated Circuits Market Research FAQs
How big is the Communication Integrated Circuits Market?
The Communication Integrated Circuits Market size is expected to reach USD 157.72 billion in 2024 and grow at a CAGR of 8.75% to reach USD 239.92 billion by 2029.
What is the current Communication Integrated Circuits Market size?
In 2024, the Communication Integrated Circuits Market size is expected to reach USD 157.72 billion.
Who are the key players in Communication Integrated Circuits Market?
Texas Instruments Inc, Analog Devices Inc, Infineon Technologies AG, STMicroelectronics N.V. and Microchip Technology Inc are the major companies operating in the Communication Integrated Circuits Market.
What years does this Communication Integrated Circuits Market cover, and what was the market size in 2023?
In 2023, the Communication Integrated Circuits Market size was estimated at USD 143.92 billion. The report covers the Communication Integrated Circuits Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Communication Integrated Circuits Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Communication Integrated Circuits Industry Report
Statistics for the 2024 Communication Integrated Circuits market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Communication Integrated Circuits analysis includes a market forecast outlook for 2024 to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
