March 1, 2024

Growing Demand For Portable Consumer Electronics To Drive Growth Of The System On A Chip (Soc) Market

The global System on a Chip (SoC) Market is estimated to be valued at US$ 164.45 Bn in 2023 and is expected to exhibit a CAGR of 8.0% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:
A system on a chip or SoC refers to integrating all the components of a computer or other electronic system into a single integrated circuit. It allows for miniaturization of device and simultaneous processing of different tasks. SoCs are commonly used in embedded systems, portable electronics such as smartphones, digital cameras, and other applications. They help reduce manufacturing cost and power consumption while increasing functionality and performance. The widespread adoption of Internet of Things devices and growing demand for portable electronics due to changing lifestyles has increased the need for low power and highly integrated components like SoCs.

Market key trends
:
One of the major trends in the SoC market is the increasing integration of artificial intelligence capabilities. Major players are developing SoCs with integrated machine learning and AI accelerators to power applications like image and voice recognition. This enables the development of smarter consumer electronics with capabilities like computer vision. For instance, Qualcomm’s Snapdragon 8-series mobile platforms integrate the Hexagon Tensor accelerator for on-device AI processing. The rise of 5G networks is also driving innovation in SoC design, with 5G modem integration becoming common. 5G-enabled SoCs allow for faster data speeds and low latency networks critical for applications like augmented reality/virtual reality and autonomous driving. Manufacturers are focusing on emerging technologies to develop highly integrated and powerful 5G SoCs.

Porter’s Analysis
Threat of new entrants: The System on a Chip (SoC) market has moderate threat of new entrants due to the high development cost of designing customized SoCs for different applications which requires huge capital investments.
Bargaining power of buyers: The bargaining power of buyers in the SoC market is moderate as there are several established players offering substitutable products. However, switching costs for buyers are low.
Bargaining power of suppliers: The bargaining power of suppliers is low in the SoC market as there are many suppliers for basic raw materials and components required for manufacturing SoCs.
Threat of new substitutes: The threat of new substitutes is moderate as specialized SoCs catering to different applications may be replaced by newer technologies, however established applications using SoCs have low risk of substitution.
Competitive rivalry: High as major players compete on the basis of innovation, product features and pricing.

Key Takeaways

The global System on a Chip (SoC) market growth is expected to witness high exhibiting CAGR of 8.0% over the forecast period, due to increasing demand for smartphones, computers and other consumer electronic devices which require high performance and low power integrated circuits.

The Asia Pacific region dominates the SoC market currently and is expected to continue its dominance during the forecast period as well owing to presence of major manufacturers of consumer electronics in countries such as China, Taiwan, South Korea and Japan. China especially is estimated to be the largest market for SoCs in the region supported by the ever-growing production of smartphones and computers in the country.

Key players operating in the System on a Chip (SoC) market are Apple Inc., Huawei Technologies Co. Ltd., MediaTek Inc., Qualcomm Technologies Inc., Samsung Electronics CO. LTD., Intel Corporation, STMicroelectronics N.V., Toshiba Corporation, NXP Semiconductors N.V., and Broadcom Inc. Major players are focusing on new product innovations through continuous heavy investments in R&D to gain a competitive edge in the market.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it