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To: Johnny Canuck who wrote (36738)	4/12/2002 5:06:36 AM
From: Johnny Canuck	Read Replies (1) \| Respond to of 68077

ASIC Market to Grow 5% in 2002, Analyst Says Online staff -- Electronic News, 4/8/2002 The market for ASICs is beginning to see improvement, according to research company iSuppli Corp., with sales expected to show marginal growth in 2002. But the market won’t return to 2000 levels until 2004. In 2001, worldwide sales of ASICs fell 28 percent to $12.9 billion. The market should return to growth this year, iSuppli said, although that growth will be slight. iSuppli is forecasting that the ASIC market will see a compound annual growth rate of 5 percent in 2002 to $13.6 billion, followed by 19 percent in 2003 to $16.1 billion. Sales will grow another 16 percent in 2004 to $18.7 billion, followed by 12.6 percent growth in 2005 to $21.1 billion and 3 percent growth in 2006 to $21.7 billion. "Compared to the market disaster that was 2001, almost any scenario in 2002 represents an improvement," said Jordan Selburn, principal analyst with El Segundo, Calif.-basediSuppli and author of the company’s latest report. "iSuppli expects the resumption of very modest growth in the coming months, driven by a second-half upturn in communications and continued strength in consumer applications." Despite the expected upturn in sales, ASIC suppliers will be facing new challenges, iSuppli said, with the greatest hurdle coming from the emerging fabless ASIC companies. These companies will become increasingly more competitive with the more established companies, iSuppli said. Additionally, the growing use of standard product solutions may become an obstacle to growth for entrenched ASIC vendors. While ASICs overall will see sales increase, revenues for gate arrays are projected to continue to fall. Gate array sales will decline from about 10 percent of total ASIC revenues, or $1.3 billion, in 2001, to less than 4 percent of ASIC revenues, or less than $1.2 billion, by 2006. This will happen despite efforts by some gate array vendors to provide easy migration paths from more costly FPGA devices. e-insite.net