Trends Impacting the Semiconductor Industry In 2022
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Trends Impacting the Semiconductor Industry In 2022

As we head into 2022, with the semiconductor industry still dealing with the global ripple effects of the chip shortage, there are several other key trends dramatically shifting the landscape of this industry. In this post, we’ll take a look at these trends and discuss what we can expect over the coming year.
Published: Mar 31, 2022
Trends Impacting the Semiconductor Industry In 2022

What Is a Semiconductor?

A semiconductor is a substance that has specific electrical properties that enable it to serve as a foundation for computers and other electronic devices. It is typically a solid chemical element or compound that conducts electricity under certain conditions but not others. This makes it an ideal medium to control electrical current and everyday electrical appliances. 

A substance that can conduct electricity is called the conductor and a substance that cannot conduct electricity is known as the insulator. Semiconductors have properties that sit between the conductor and insulator. A diode, integrated circuit (IC) and transistor are all made from semiconductors. 

Semiconductors became essential for many electronic appliances as well as for social infrastructure that support our everyday life. Semiconductors play an important role in equipment control in a variety of fields, such as operating air conditioners at a comfortable room temperature, improving automobile safety, laser treatment in cutting-edge medical care and many more. Moreover, advances in semiconductor technology have driven systems efficiency through miniaturization and energy savings. They have been essential in the preservation of the global environment and in providing safe and comfortable applications to create a prosperous future.

What Are Current Issues for the Semiconductor Industry?

Continued Chip Shortage
The global semiconductor chip shortage has disrupted most industries and constrained supply chains. Automotive and consumer tech manufacturers have felt the biggest strain of reduced chip availability as many have been forced to delay product launches resulting in expected revenue loss. 

As demand for chips continues to soar, supply chains could remain constrained for the foreseeable future. That means everyone – semiconductor businesses and their customers – should focus on building more resilient supply chains and use just-in-time models selectively. 

Being better prepared for the future depends on re-examining near and long- term strategies and acting on lessons learned from shortages that disrupted manufacturing worldwide.

Geopolitical Impacts
Today’s mergers and acquisitions are generally involving smaller deals or are taking longer to finalize due to geopolitical considerations. In particular, the environment has not been very conducive toward larger, cross-border deals. Still, select megadeal opportunities have emerged even as the effects of COVID-19 continue to exacerbate global chip shortages. We expect these larger deals will face similar geopolitical constraints, making smaller transactions an attractive alternative. Moving forward, it will be important for companies to learn how to extract more value out of smaller opportunities.

Changing the Competitive Landscape
Many tech giants such as Apple, Tesla, Google, and Amazon are now making their own ASIC chips designed specifically for their products. This gives them more control over the integration of software and hardware while differentiating themselves from their competition.

Battle of the Chip Architectures  
The x86 architecture has dominated the microprocessor industry for over 50 years.  However, this is now changing with the growing popularity of Arm. While Arm’s architecture was born out of a need for low-power chips needed for vertical applications, they are starting to emerge not only as a low-power solution, but also as a high-performance contender, rivaling the established x86 players.  

As a result, when hyper-scalers such as Google and Amazon Web Services decided to make their own chips, they opted for the Arm architecture for its performance and low-power consumption that has become so critical for power-hungry data centers, consumer products and sustainability efforts.

Sustainability
The demand for semiconductors has never been greater and is expected to keep increasing due to emerging technologies such as 5G, AI, and the Internet of Things (IoT). To meet this demand, semiconductor production will need to increase, which will cause a massive surge in energy consumption and water usage. A single semiconductor fab can consume up to 1 TWh of energy per year and two-to-four million gallons of ultra-pure water per day. Industry leaders such as TSMC and Intel are taking proactive steps and have been working on substantial sustainability programs.

Opportunities for 2022

There is a wide variety of challenges and opportunities awaiting the semiconductor industry in 2022. Be always having the pulse on the latest changes, competitive threats and global trends. This enables companies to prepare the right technologies and strategies they need to be resilient in the face of change.

Published: Mar 31, 2022 Source :TechTarget, Source :Hitachi, Source :accenture

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