October - 2014 - issue > CXO View Point

Semiconductors: Beyond the Compute & Smartphone Era

By Job K Joseph, Pre-Sales Consultant, Manufacturing & Hi-tech, Wipro Limited
Monday, November 24, 2014
By Job K Joseph, Pre-Sales Consultant, Manufacturing & Hi-tech, Wipro Limited
Wipro Limited (BSE: 507685) (NSE: WIPRO) (NYSE: WIT) is an IT Consulting and System Integration services company based out of Bangalore. The company has a current market cap of Rs.140,529.54 crore.

The semiconductor industry is widely recognized as a key driver for economic growth in its role as a multiple lever and technology enabler for the whole electronics value chain. However, a detailed view of industry annual figures for 2013 revenues reveal a sorry state, in contrast to analysts� projections of $400 billion by 2015/16.This is largely due to the fact that the industry has been witnessing an emergent plateau effect in key areas that once successfully supported the demand for semiconductor products. Thenewer avenues for growth are diverse and spread acrossverticals, but with potential to generate only moderaterevenue streams, unlike the demand created by smartphones and tablets over the last decade.

Customer Life cycle in the Semiconductor Industry

The various stages in the life cycle for a semiconductor provider�s customer play out slightly differently for the commoditized solutions segment.The customer life cycle for a leading LTE Integrated Radio product targeted at smartphones and tablets would be different from commodity products such as analog to digital converters and other discrete component devices.

Semiconductor products are categorized into ASICs & ASSPs based on how they are used by end customers. ASICs are usually built for few high-volume customers with lock-in contracts. ASSPs(application specific standard parts)essay standard functionsare sold primarily using a traditional make-then-sell process.

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