Digitization driving rapid analog growth

Author: Biswadip (Bobby) Mitra
Managing Director, Texas Instruments India
It comes across as a paradox. It may sound counter-intuitive to some. But it is a reality that as the world becomes more digital, the more is the need for analog chips.

Take any electronic end-equipment where digitization has taken major strides – whether it is in wireless, entertainment, industrial, or other domains. In every such system, we see rapid growth of analog semiconductor solutions – whether it is amplifiers, data converters, interface, or power management chips. Emerging opportunities, such as medical electronics or renewable energy systems, are also demanding critical analog semiconductor solutions.

Analog chips provide the means for converting real world signals such as voice, sound, pressure, and temperature into the digital world. What makes analog so ubiquitous is that there is ‘at least one’ analog chip in ‘every’ electronic system in the world. Think about it – one or more analog chips in every electronic system! This makes analog a very powerful growth engine for the future.

Let us take wireless communication as an example. Whether it is audio quality, battery life, or quality of display in our handsets – it is analog components that play a vital role. Similarly, in wireless base-stations, high performance analog solutions have a strong impact on the power consumption and customer coverage per cell site.

In the automotive sector, analog designs play a crucial role in safety, fuel efficiency, and car entertainment systems. In digital cameras or camcorders, the image or video quality is directly linked to the analog components in the system. Similarly in ultrasound systems, the analog components – amplifiers, and data converters - have a direct impact on the resolution of the image.

The analog market today is large – and the future growth opportunity even higher. The worldwide analog market was $37 billion in 2006 and it constitutes the single largest semiconductor market. A less known, but important, story is that of India’s analog semiconductor market. The analog total available market (TAM) in India (as per ISA-Frost & Sullivan, 2007) is expected to reach $425 million by 2010, representing a CAGR (compound annual growth rate) of 27.4 percent. The last few years have seen increased systems engineering innovation by OEMs – both local and multinational. Along with the need for digital chips, this has spurred the need for analog solutions.

Industrial Electronics, Medical Electronics, Telecom and Consumer Electronics sectors have been experiencing a high rate of growth in India. The Industrial Electronics sector particularly, is anticipated to maintain the momentum with the growth of end user markets. High volume products like energy meters, UPS, inverters, LED lighting are expected to continue their contribution to overall semiconductor revenues in the country.
According to ISA-Frost & Sullivan Report, the Indian electronics equipment production is expected to reach $58 billion in 2010 and $155 billion by 2015. This will drive significant local semiconductor consumption.

Therefore, it is truly an exciting time to play in the India market. Consumer digitization is happening at a fast pace. So is the demand for not only digital chips, but also for analog components. Partnering with our customers and making them win will provide us with the incredible opportunity to change the future landscape of India.
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