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Gartner: Chip industry in ‘indefinite’ slowdown

The days of double-digit are growth are over, possibly forever, says one analyst

The global semiconductor industry is in a slowdown that one industry analyst doesn’t see it coming out of time soon, if ever.

Worldwide semiconductor revenue totaled US$273.9 billion last year, up just 3.8 per cent from 2006, according to a report from Gartner Inc. For an industry that’s accustomed to double-digit growth, the growth last year was noticeably slight. However, it’s a result that the industry may have to get used to, according to Gartner analyst Richard Gordon.

“Obviously, it’s better than negative growth, but from a historic semiconductor view, it’s not strong growth,” Gordon said. “The market is in a low-single-digit growth phase. It’s a concern. The high growth of the late ’90s seems to be in the past now. I don’t see anything on the horizon that will fuel growth in the near future. We’re talking about long-term – about forever.”

He added that he simply doesn’t see any major new growth drivers – like the PC and cell phone were – on the horizon.

“It just seems to be more of the same,” Gordon said. “From a demand point of view, there will definitely be volume growth, but pricing pressure will continue. We are concerned that we’re in an indefinite low-revenue growth phase.”