Skip to main content

Smartphone Drives Apps Processor Growth

As the wireless handset market surpasses 1 billion units shipped per year, application processors are an increasingly important enabler of multimedia capabilities in high-end smartphones and feature phones.

However, according to a recent study from ABI Research, this growing market will face several key challenges over the next several years.

"Over the course of our forecast period, from 2007 to 2012, strong unit growth is expected to be offset by dropping unit prices," says ABI Research senior analyst Doug McEuen. "After significant increases during the next two years, the decline in unit prices will compress the application processor revenue to a flat growth rate."

In later stages of market development, application processor unit shipment growth is expected to decrease due to two key factors -- integration, and the rise of the ULCH (Ultra Low-Cost Handset) market.

Integration impacts the market negatively, as multimedia functions are combined into the baseband processors, fabricated using 65nm or 45nm process technology. Low-cost handsets, which will not require an additional application processor given their limited multimedia functionality, likely will increase market share within the overall wireless device market -- further contributing to the decrease in application processor unit growth.

In 2012, application processor revenue is expected to reach nearly $2.8 billion, with unit shipments of 553 million, at a cost of $5.04 per unit.

ABI Research notes that over the next several years, the smartphone segment will be the largest market for application processor unit shipments. Although smartphone revenue will decrease from $3.3 billion in 2007 to $2.1 billion in 2012, it will continue to dominate the market.

"One device with the strongest growth over the same forecast period is the high-end feature phone, or enhanced phone, as unit shipments are expected to increase by 42 percent," concludes McEuen, "while revenue will rise by almost 21 percent."

Popular posts from this blog

Global Rise of Domestic Payment Ecosystems

Alternative Payment Methods (APMs) – comprising digital wallets, instant payments, and QR payment systems – are experiencing explosive growth that's reshaping the global financial services marketplace. According to the latest worldwide market study by ABI Research , the combined global transaction value for APMs is projected to reach $142 trillion by 2030. What's particularly fascinating is the underlying driver behind this trend: a growing desire for financial sovereignty, with nations developing domestic payment ecosystems rather than remaining dependent on international financial networks. Payment Ecosystem Market Development In 2024, approximately 45 percent of the global population used digital wallets – a remarkable adoption rate for a technology that barely existed a decade ago. China leads this transition, with 95 percent of its population using WeChat's payment functionality. WeChat exemplifies the "super app" phenomenon, where payment capabilities are in...