According to The Insight Partners new research study on the system in package (SiP) technology market was valued at US$ 13756.2 million in 2019 and is projected to reach US$ 22013.4 million by 2027; it is expected to grow at a CAGR of 8.4% during 2019–2027. Growth in demand for the miniaturization of electronics drives the market growth. However, technical issues and the availability of alternative solutions hamper the market growth.
In 2019, Asia Pacific dominated the SiP market with more than 50% revenue share. The region is the largest consumer of smartphones; it accounted for sales of ~732 million units in 2018. The telecommunications sector is witnessing strong growth in the Asia Pacific mainly due to the positive outlook toward the introduction of 5G networks and the strong presence of 4G networks. According to Ericsson’s mobility report, 5G deployments would account for 66% of the total connectivity in Western and Northeast Asia by 2026, while in Southeast Asia and Oceania, it would hold 32% share; the rest of the shares would be held by the LTE (4G) technology. In terms of packaging technology, 2D ICs integrated with different technologies enhance the device performance. However, the increasing demand for microelectronics is a major factor challenging the progress of the market for this segment, which can be resolved through extensive research and development. In terms of packaging type, the flip-chip/wire-bond SiP segment is anticipated to hold a major market share during the forecast period. Further, the pin grid arrays segment dominated the global SiP market, by interconnection technique, in 2019. Among the key end-user industries, the consumer electronics segment held the most significant market share in 2019.
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(SiP market Segmented by Region/Country: North America, Europe, Asia Pacific, Middle East & Africa, and Central & South America)
The growing trend of adopting handheld electronic devices with small form factors is one of the major factors accelerating the SiP technology market growth. The miniaturization of electronics has influenced the industries such as military, aerospace, medical, media, retail, and consumer electronics. The devices with small form factor-based packages embed more functionality and serve as an alternative for traditional packaging systems. Personalized healthcare gadgets, thin smartphones, compact PCs, and other devices are embedded with processors, sensors, and RF modules, among other components, which are based on the system in package technology. Continuous developments in advanced packaging technology such as 3D IC and 2.5D IC are further supporting the market growth by addressing the technical challenges.
Ongoing innovations in mobile solutions are enhancing device performance as smaller spaces of mobile devices confers enhanced connectivity and control. The SiP technology market players are also making efforts to optimize this technology for better solution formation. For instance, in November 2020, SODAQ Company introduced a new miniaturized SODAQ TRACK SOLAR device with 80 × 80 × 11.5 mm3 dimensions, using Nordic multimode NB-IoT/LTE-M nRF9160 SiP solution. Similarly, Apple Company uses the system in package technology for upcoming devices to introduce miniaturized products. Thus, the rising development and demand for miniaturized electronics devices is driving the SiP technology market growth.
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SiP Technology Market: Segmental Overview
On the basis of packaging technology, the SiP technology market is segmented into 2D IC, 2.5D IC, and 3D IC. The market for the 3D IC segment is anticipated to grow at the highest CAGR due to its smaller packaging footprint. In 3D ICs, logic dies or memory dies are stacked upon each other to form connections using an active interposer. The 3D IC technology confers higher density in the given space, thus enabling more effective miniaturization of electronics than other packaging technologies. Other benefits of 3D IC include high speed, low power consumption, and enhanced performance. Further, increasing developments and adoption of 5G networking devices would also contribute to the growth of the market for the 3D IC segment in the coming years. The 2D IC SiP accounted for more than 50% share in the SiP technology market in 2019. This packaging technology has strong roots in the market as it is traditionally being used in a wide range of electronics. It connects different discrete devices using a printed circuit board with their packages. The technology offers large and bulky circuit boards, which hinders device performance, which is lowering its demand in various industries.
On the basis of the interconnection technique, the pin grid arrays (PGAs) segment is projected to register a CAGR of more than 9.2% in the market during the forecast period. This interconnection technology is widely used in microprocessors that can be placed on grids, wherein pins are arranged vertically. Different types of PGAs such as ceramic, plastic, flip-chip, and staggered arrays are available in the market. The interconnection technique is a low-cost solution that is also suitable for new processors for faster data transmission. AMD is one of the companies using the PGA design for the Socket AM4 that is used in CPU and APU products.
On the basis of the application segment, the consumer electronics segment is expected to account for ~40% of the overall SiP market, by end-user industry, during the forecast period. Rising disposable incomes and increasing tech-savvy populations are boosting the adoption of advanced and compact consumer electronics, thereby augmenting the SiP technology market growth. The advent of compact smart wearable devices is further escalating the demand for SiP technologies. Advanced packaging systems that allow the packaging of a maximum number of components on a single board, in limited space, are supporting the latest trend of miniaturization of electronics devices.
System in Package (SiP) Technology Market: Competition Landscape and Key Developments
Qualcomm, Chunghwa Telecom, and ASE jointly developed 5G mmWave enterprise private network smart factory in Taiwan. In 2020, Renesas Electric Corporation joined Global Semiconductor Alliance.
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