For years, we've heard the Internet of Things touted as the Next Big Thing, and we've grown accustomed to the industry's bold predictions about this market—including trillions of devices on the horizon and bringing more than Tens of billions of dollars in IC revenue, etc. As the smartphone market shows signs of softening, chipmakers in recent years have increasingly relied on growth from another area seen as a focus: the Internet of Things. Motherboard customization
As market progress slows this year, smartphones may or may not meet the requirements of chip suppliers, but the data from the first quarter released so far clearly shows the power of the Internet of Things to drive semiconductor sales growth. is accelerating. Several companies already attribute sales growth to the Internet of Things, including Intel, Texas Instruments (TI), STMicroelectronics (ST), Cypress Semiconductor and Silicon Labs, among others.
"Over the past few years, these companies have restructured to allocate entire divisions to IoT platforms. That's why you hear so much about IoT driving revenue," said Tom Hackenberg, principal analyst for embedded processors at IHS Markit .
Sales of semiconductors used to enable IoT systems will total about $24.5 billion this year, up from $21.3 billion last year, according to IC Insights. The market research firm is currently updating its forecast for IoT chip sales, but last year's estimate said the market will grow to $31.1 billion in 2020.
For chipmakers, one of the challenges in defining the IoT market opportunity lies within the IoT itself. Because it is not actually a market, it can only be said to be a function at most. As Cypress President and CEO Hassane El-Khoury said, when Cypress sells connected chips to automakers for connected cars, those components are still sold to the automotive market, not a separate The "Internet of Things" market.
El-Khoury said it is difficult to determine the impact of IoT on Cypress's business. IoT is one of three focus areas where El-Khoury launched his 'Cypress 3.0' strategy when he took over as CEO last year - in addition to IoT, automotive and industrial. As El-Khoury illustrates, there is a lot of overlap in these areas. Still, Cypress continues to sell microcontrollers (MCUs) and memory, as these products are involved in many IoT-related products.