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revenue totalling $167bn, up from $153.4bn in 2002, according to quarterly
forecast estimates from Gartner Dataquest. The slowdown at the end of 2002
is continuing in Q1 2003.
The market analysts believe that business spending on IT will return in H2
2003, which will fuel demand. While the cell phone handset application
segment continues to be the major driver for chip sales, the second phase of
the recovery requires a healthier PC market.
Looking longer term, the analysts say that a combination of pent-up demand
and under-investment in fab capacity is likely to act to spur semiconductor
unit shipment growth and stabilise device pricing, making prospects for
strong growth in 2004 and 2005.
Another market research organisation, IDC, says that a majority of companies
in the US, Europe, and Asia/Pacific (85%) expect to increase or maintain
their IT spending levels in 2003, but that economic stability and corporate
profits remain key to an IT market rebound. The study was based on a survey
of nearly 1000 CEOs and CIOs in 12 countries.
"Just as IT spending was severely disrupted in 2002 by wild card factors
including WorldCom and Iraq, so it is that the outlook for 2003 remains
clouded by similar uncertainty," says Stephen Minton, program director at
IDC Worldwide IT Markets.
Another market research company - Semico Research - cut 2 points off its
growth forecast for the semiconductor industry this year. The company now
expects a 23% increase in 2003. Semico president Jim Feldhan says that the
industry is suffering from "Iraqnpophobia" resulting from the
"fear/uncertainty of war with Iraq". The effect includes uncertainty of oil
supply, length of the coming war, use of chemical weapons and increased
incidence of terrorist attacks.
The NAND Flash market saw an 85% growth in business to more than $2.3bn in
2002, according to iSuppli. The market researcher says that this is thanks
largely to a tremendous increase in the popularity of flash cards as storage
devices for digital cameras.
The company expects lesser growth in 2003, with a better than 26% revenue
increase forecast, primarily due to a softening in consumer confidence. By
2007, Flash card revenues are expected to reach more than $18bn. Capacity
will also take off, from last years average of about 100MByte to well over
1Gbyte by 2007.
VLSI Research released its top ten semiconductor equipment suppliers for
2002 based on revenues. US and Japanese companies dominated the listing with
only one European company - lithography system producer ASML at No.3 with
$1.875bn in revenues.
There were no surprises at Nos.1 and 2 - Applied Materials with $5.080bn and
Tokyo Electron (TEL) with $2.646bn. KLA-Tencor - the US supplier of
inspection and metrology equipment - came in at No.4 with $1.419bn.
The two Japanese lithography companies Nikon and Canon made No.5 and No.6,
respectively with $1.091bn and $0.848bn. The remaining companies in the top
ten were: Novellus ($0.837bn), Dainippon Screen ($0.737bn), Lam Research
($0.726bn) and Hitachi High-Technologies ($0.631bn).