Power Up?

Welcome to this power-focused edition of Electronic Design Europe, in which you'll find 75% of the content is dedicated to developments in the worldwide power-semiconductor industry. For an editor like me, the power-semiconductor market is great. Its dynamism provides an infinite source of interesting and valuable technology news to use in this magazine.

It has also proved to be a financial saviour for some semiconductor companies. It was power technology that helped many ride the financial storm that hit when the comms market plummeted a few years ago. Generally speaking, the power sector has and still is doing well financially. Yet it is not difficult to find conflicting theories when it comes to analysing the financial future of the power market. On the one hand, we have management at major players like Fairchild, Infineon, Philips, and STMicroelectronics trumpeting the fact the power market is on the up. On the other, analysts at the Darnell Group are being very cautious about the communications power system side of the business.

So who's view should we really buy into? Whose crystal ball is the clearest? Well to be fair, what Fairchild, Infineon, Philips, and STMicroelectronics are saying is that the power market will generally do very well in Europe over the next few years. Fairchild's boss Mark Thomson was more specific and believes that his company will see 60% sales growths in Europe and the USA during the next three years, with Asia Pacific growing at about 30% and Japan nearly 40%. All very positive stuff.

But when it comes to specific sectors like the communications power market, the message is restrained almost to the point of inertia. Can this really be the case? The Darnell Group believes that although there are signs the market is starting to turn around, it is likely an upturn will translate into flat sales as opposed to the more recently experienced declining sales. Unsurprisingly, boadband access is expected to be a key driver of equipment spending in the worldwide communications power market. The introduction of IP networks, along with the rollout of 3G and Wi-Fi services, will also boost equipment sales, claim the analysts. So things are positive, albeit in a conservative way.

So, generally speaking, the financial future is rosy for players in the power semi market, providing they stick to the rules laid down by the lessons of history. Watch out for seductive growth rates in the comms market as over-committing product ranges and corporate energies into comms applications can prove a financial roller coaster when the market tumbles. Don't neglect the more stable markets like automotive, industrial, and medical systems that helped many company sales figures when the comms market wobbled. And don't forget the fiscal protection afforded by diversifying power products across a sensible range of power applications, rather than putting all of the design eggs in what looks like the biggest sales basket.

TAGS: Automotive
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