07/13/2009 11:01 AM
SAN FRANCISCO—FPGA revenue is projected to grow to nearly $3.5 billion in 2013 from $2.55 billion in 2009, a faster growth rate than is anticipated for the broader IC market, according to a study released Monday (July 13) by market research firm The Linley Group.
The report, titled "A Guide to FPGAs for Communications," concludes that FPGAs are likely to continue displacing ASICs and application-specific standard products (ASSPs) for many applications. But the report also finds that FPGAs cannot compete with the cost advantages of ASICs for many high-volume applications.
FPGAs will continue to cut into the ASIC market, but are unlikely to displace the highest-volume ASICs found in video-game consoles, set-top boxes and other consumer applications, according to the report.
"What it boils down to is, if you have markets that are worth $100 million or less, it doesn't make a lot of sense to do an ASIC," said one of the study's authors, Jag Bolaria, a senior analyst with The Linley Group.
Bolaria noted that rising costs for design and other non-reoccurring engineering expenses make FPGAs a more attractive option than ASICs for most applications outside of high-volume applications. He agreed, basically, with the position of Xilinx President and CEO Moshe Gavrielov and others that these trends would enable FPGAs to bite into the market share of ASICs.
But Bolaria also suggested that FPGA proponents paint an overly optimistic picture and noted that the use of FPGAs doesn't eliminate front-end design effort. He acknowledged that going with an FPGA over an ASIC does eliminate photomask set costs, which can be well into the millions at advanced nodes.
"There are certainly some savings, and FPGAs do allow you to get to market quicker," Bolaria said. "But the issue is not as black and white as it is sometimes painted."
Revenue decline anticipated for 09
After reaching $2.96 billion in 2008, FPGA revenue is projected to decline to $2.56 billion in 2009 before rising to $2.81 billion in 2010, $3.04 billion in 2011, $3.49 billion in 2012 and $3.48 billion in 2013, according to the Linley Group's report.
FPGA revenue from the largest market for FPGAs, communications applications, is projected to rise from $1.22 billion in 2009 to $1.58 billion in 2013, according to the report. The Linely Group predicts slightly faster revenue growth for FPGAs used in other markets, including broadcast video, digital TV, industrial, medical and automation.
Market research firm iSuppli Corp.'s most recent semiconductor industry forecast projects the market for all programmable logic devices to rise from $3.73 billion in 2008 to $4.22 billion in 2013, a compound annual growth rate (CAGR) of 2.5 percent. Meanwhile, the firm projects that the broader semiconductor market will grow at a 1.1 percent CAGR over the same period, reaching $272.94 billion in 2013.
he Linley Group's report predicts that increased densities, performance and customization of FPGAs will fuel the devices' rise over the forecast period. The report delves into technology offered by market leaders Xilinx and Altera Corp., as well as other established players and startups.
"Our report provides a roadmap to the complex FPGA product lines of market leaders, while contrasting the use of FPGAs vs. off-the-shelf ASSPs and ASICs for enterprise equipment, broadband infrastructure, telecom switches and wireless base stations," Bolaria said.
The report also details some of the design challenges presented by FPGAs and offers advice for OEMs and silicon startups on how FPGAs can be used. The report is geared toward engineers designing products that use FPGAs, as well as marketing executives, financial analysts and others, according the The Linley Group(Mountain View, Calif.).
The report is priced at $2,995 for a single-user license.