Semiconductor market bouncing back after Japan disasters

High demand for portable devices and the quick response by manufacturers to the recent natural disasters in Japan have put the semiconductor industry back on track for growth in 2011, according to research firm IHS iSuppli.

The company predicts that the semiconductor market will see revenues grow by 7.2 per cent on the year, despite the earthquake and tsunami in Japan which had initially threatened to devastate the electronics industry.

Dale Ford, senior vice president of semiconductor market intelligence for IHS iSuppli, told V3.co.uk that the growth was due to a mixture of high demand and resiliency from manufacturers.

He explained that in the wake of the earthquake, firms such as Texas Instruments were able to shift their operations from disaster-ravaged parts of Japan to facilities elsewhere in the country or region. Other vendors, such as Fujitsu, were able to quickly execute disaster response plans and return their operations to pre-quake output levels.

Ford added that increased demand for mobile tablets was helping to drive revenues and that the traditional backbone of the semiconductor market, PC sales, remained steady.

"[Tablets and smartphones] are some of the areas that are high growth, but you can never ignore PCs," Ford said.

"If you had weak growth in PCs, that would be hard on the market overall."

Going forward, IHS iSuppli expects the semiconductor market to continue to grow on the back of healthy demand for tablets and other instant-on devices. One small caveat remains, however, in the form of the overall global economy.

"While we are not relying on a strong market to drive this growth, it has to be reasonably stable," Ford explained.

"If we have a serious collapse in the economy it can still pull it down."