Semiconductor Intellectual Property (IP) is a reusable unit of chip layout design, cell, or logic, which is an intellectual property of a company. It may be licensed or borrowed by other companies to be used or can be owned and used by a single party alone. IP cores can be utilized as building blocks for FPGA logic designs or ASIC chip designs. Semiconductor intellectual property allows manufacturers to design chips more efficiently and enhanced speed by employing existing blocks. Using these blocks increases the efficiency of final products and improves the quality of devices. The global market for semiconductor intellectual property is expected to expand significantly over the forthcoming years due to manufacturers’ desires for reducing design and manufacturing costs of electronics devices. Transparency Market Research (TMR) has projected that the global market for semiconductor IP will reach the valuation of US$9.1 bn by the end of 2025, while showcasing an impressive CAGR of 10.7% over the forecast period of 2017-2025.
Prominent players in this market are constantly innovating and trying to obtain new IPs sooner than the competitors. However, arrival of new players are threatening well established players. TO sustain the dominance in the market, well established and developed companies are acquiring new players to own their resources. For instance, on June 1, 2015, Intel Corporation acquired Altera, a prominent manufacturer of programmable logic devices for $16.7 billion to utilize their resources. Similarly, other prominent players are following various strategies to maintain their significance in this highly competitive market. These players include Videantis GmbH, Synopsys Inc., Silabtech Private Limited, Open-Silicon, Inc., Mentor, Imagination Technologies Limited, Kilopass Technology Inc., eSilicon Corporation, Cast In., Ceva Inc., and Cadence Design Systems, Inc.
Which segments of the market are most likely to project high growth?
On the basis of product type, the market for semiconductor IP can be segmented into hard IP and soft IP. The soft IP segment dominated the market in 2016, while contributing 51.7% to the overall market. The increasing applications of soft IP cores such as synthesizable and netlist cores are benefiting the segment to expand prominently. The usage of high quality soft IP enhances the hardware quality of electronics products. It is estimated the soft intellectual property core segment will project a healthy CAGR of 13.1% over the forecast period owing to its capability of optimizing hardware components and testing in the virtual environment.
Considering applications, the semiconductor intellectual property market can be split into consumer electronics, telecommunications, healthcare, and automotive. Among these, the automotive segment is more likely to exhibit high growth due to rising demand for soft IP and hard IP over this segment. The automotive segment is anticipate to expand with a significant CAGR of 11.2% over the forecast period.
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Which geographical regions are anticipated to provide fruitful opportunities for the market investors?
Geographically, the global semiconductor IP market can be segmented into South America, Middle East and Africa, Asia Pacific, Europe, and North America. Of these, Asia Pacific held a dominating position and contributed 32.4% to the global market in 2016. The bolstering consumer electronics industry in this region is demanding for hard IP core, resulting in the expansion of semiconductor IP market over this region. Furthermore, countries such as Japan, China, and India are consuming and exporting high quantity of electronic devices such as smartphones, home appliances, and televisions, providing momentum to the market.
Moreover, Europe is expected to expand with a magnificent 10.9% CAGR over the period 2017-2025 due to the contribution of countries such as the U.K., Germany, and France. Presence of prominent vendors striving to expand their business and the development of semiconductor market within this region are among the noteworthy factors resulting in the growth of the Europe segment.