Sensors and NFC Markets Experiencing Strong Growth

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According to the latest tracker from Databeans "Q3-2011 Sensors and MEMS" the sensors market is growing significantly faster than the overall semiconductor market. The sensor market is forecasted to have a 10 percent compound annual growth rate, with average unit prices decreasing by 1 percent over the same 5 year time frame.  Contactless smart cards and NFC transceivers are also growing strong with an estimated compound annual growth rate of 20 percent.     

The two strongest market segments impacting the sensor industry are the consumer and the automotive industry. The revenue for sensors in the consumer market segment is forecasted to increase to $853 million by the end of 2012 and $203 million for the automotive segment respectively. These two segments constitute 40 percent of the sensors market alone. New technologies and government regulations being developed now are only going to increase these numbers as time progresses.           

The consumer segment is being driven by high demand for smart phones and tablet PCs. Although this is no new phenomena, the new sensors that will soon be added these products will make them even more desirable to consumers. Most of these products today already include gyroscopes, accelerometers, touch sensors, GPS, and magnetic field sensors.      

In addition the automotive market is continuing its growth of electronic applications. The sensors market is experiencing an immediate push because of NHTSA regulations that mandate Electronic Stability Systems (ESC) and Tire Pressure Monitoring Systems (TPMS) for every new vehicle that rolls off the production line. Fuel economy and emissions standards have also increased the demand for exhaust temperature sensors in vehicle applications. These same regulations will soon be adopted worldwide and create some of the growth that will be seen in the automotive sensors market.     

Manufacturers should look for a strong push to include NFC (Near Field Communications) chips to be on smart phones and tablets. These transceivers and contactless smart cards will sense and transmit secure information between devices. The most significant application of this technology in the near future will be with the use of currency transactions from mobile handsets. The emergence of this technology is being pursued by many companies, the most well known being Google Wallet. This service is currently in a testing phase because of limited device and financial institution support. During the next couple years however, this will dramatically change.     

Currently there are only a handful of phones that are equipped with NFC chips, but it is rumored that even the next generation of iPhone's and iPad's will include them. Most other companies will also follow suit and include the NFC chips in their competing products. The Google wallet system only includes one type of credit card on the Android Nexus S, but there are many other ventures and startups experimenting with this technology too. Companies such as ISIS, Square, Jumio and Naratte will offer competing cards that will be accepted in the developing NFC payment infrastructure. The change in payment medium will be resisted for a short time, similar to the switch from checks to debit cards, but it will eventually be adopted. This adoption will create a large production demand for NFC chips in the consumer segment.     

Databeans forecasts the sensors and MEMs market to reach $19.1 billion by 2016, which means the companies involved will profit considerably. Databeans "Q3-2011 Microcontroller Market Tracker" projects that the contactless smart card market will reach $540 million this year.  More information on these two markets is available from Databeans a


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