System On A Chip (Soc) Market To Witness High Growth Owing To Rising Adoption Of Iot And Connected Devices
The system on a chip (SoC) market is estimated to be valued at US$ 164.45 Bn in 2023 and is expected to exhibit a CAGR of 8.0% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
A system on a chip (SoC) is an integrated circuit that integrates all components of a computer or other electronic systems into a single chip. It contains digital, analog, mixed-signal, and often radio-frequency functions all on a single chip substrate. Using SoCs benefits manufacturers with reduced development costs, enhanced features, and increased reliability. Some key uses of SoCs include smartphones, computers, networking devices, robots and more.
Market Dynamics:
Rising adoption of Internet of Things (IoT) and connected devices is a major factor driving growth of the SoC market. IoT enables both consumer and industrial products to be connected to the internet and share data with each other wirelessly. The integration of various subsystems into a single chip in an SoC allows for increased connectivity and mobility in these devices at affordable costs. Furthermore, increasing focus of automotive manufacturers on vehicle electrification and driver-assistance technologies is also fueling demand for advanced SoCs. However, high research and development costs associated with continuous technological advancements in SoC technology remains a challenge for market players.
SWOT Analysis
Strength: SoC technology allows manufacturers to incorporate multiple computational and connectivity components into a single chip, reducing production costs and improving reliability. The technology also enables the development of more compact electronic devices. Growing demand for low-cost embedded systems is driving widespread adoption of SoCs across various industries.
Weakness: Developing cutting-edge SoC designs requires massive R&D investments and specialized engineering expertise that are difficult for new players to replicate. Dependence on a small number of foundries for manufacturing also poses risks related to supply chain disruptions.
Opportunity: Emerging applications centered around IoT, AI, augmented/virtual reality, autonomous vehicles and 5G networking provide vast opportunities for innovation and deployment of new SoC designs. Expanding into growth markets such as industrial automation, healthcare devices and smart infrastructure can boost revenue streams.
Threats: Dependence on a few core customers increases the risk of downturns in specific industries negatively impacting business. Rising chip costs and design complexities associated with scaling to the latest process nodes threaten profit margins. Intense competition from other semiconductor firms poses threats from substitutes.
Key Takeaways
The global System on a Chip (SoC) market scope is expected to witness high growth, exhibiting a CAGR of 8.0% over the forecast period, due to increasing demand for low-cost embedded systems across various industries.
Regional analysis: North America dominated the SoC market in 2023 with a share of over 30%, driven by proliferation of advanced technologies requiring reliable and cost-effective SoC solutions across industries such as consumer electronics, automotive and networking. Asia Pacific region is expected to witness the fastest growth going forward, led by expanding electronics production and adoption of IoT in countries like China, South Korea and India.
Key players operating in the System on a Chip (SoC) market are Apple Inc., Huawei Technologies Co. Ltd., MediaTek Inc., Qualcomm Technologies Inc., Samsung Electronics CO. LTD., Intel Corporation, STMicroelectronics N.V., Toshiba Corporation, NXP Semiconductors N.V., and Broadcom Inc. The intensity of competition is expected to further increase with growing focus on merging wireless and computing capabilities into single solution.
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