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Chip sales rocket – no one makes money

One of the smartest things anyone can do is work less for more money. Conversely, one of the dumbest things we can do is work harder/faster for less and less. Unfortunately, this is the situation that the major producers are finding themselves in. KitGuru heads down to the local takeaway to check on the price and availability of chips.

Established in 1959, IHS is one of the more important research organisations into the energy, product lifecycle, environment, security and Technology/ Media/Telecoms industries. Its iSuppli acquisition produces key data about market sizes, directions and shares. The latest copy indicates some significant growth, but it might not be growth that many companies want to service.

2011 saw the dregs of the global recession dragging the world back. Even though products like the iPad penetrated harder and deeper than expectation, the overall market only grew 1% for chip revenues.

iSuppli is predicting that 2012 will see a rise of around 4.3% in 2012 and a whopping 9.3% in 2013. That is in line with predictions about overall system market growth that we have seen from experts like IDC’s Eszter Morvay.

The problem is that the underlying increase in product shipment is so fast, that almost no one finds this expansion interesting.

KitGuru says: eBuyer ran an offer last week for a 32GB USB pen drive that was less than £15. This is the way that the market is going. It will be cool for consumers, but a right pain for manufacturers, who will be expected to crank up production and the development of new FABs, without the expectation of massive profits. Sucks to be a chip man, eh?

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