Market Share Rankings In Key Segments Of The Semiconductor Market - Company Business and Marketing

EDP Weekly's IT Monitor, July 17, 2000

Samsung and Hyundai are slugging it out for the leading market share position in the DRAM segment, Texas Instruments is hanging on in the hard disk drive (HDD) market, but the other segments of the semiconductor market have clear cut leaders. IDC recently published reports announcing market share leaders in each of the following semiconductor areas: PC graphics and MPUs, LAN, modem, HDD, DRAM, and flash cards.

According to IDC, Samsung hung onto first place in the worldwide DRAM market, fighting off a threatening run by Hyundai. In 1998, Samsung had what appeared to be a firm grip on the market's top spot with more than 20 percent of worldwide revenues. Hyundai was the closest competitor, a good distance behind with 12.5 percent of worldwide revenues. However, in 1999, Hyundai increased its revenues by more than 145 percent. As a result, its market share jumped to almost 21 percent. Samsung, meanwhile, grew its revenues almost 60 percent, and its market share inched up to 21.7 percent. Micron is also emerging as a serious threat in this market. Its revenues grew 160 percent, driving its market share from 9.2 percent in 1998 to 16.1 percent in 1999.

IDC expects the competition in the DRAM market to heat up even more this year. "Despite the rapid growth that Samsung experienced last year, they'll have a tougher time this year as Hyundai and Micron not only continue to grow at a faster pace, but also continue to ramp their folded acquisitions into one unit," says Soo Kyoum Kim, research manager for IDC's semiconductor program.

In the hard disk drive segment, Texas Instruments suffered a 17 percent revenue loss, causing its market share to drop from 32 percent in 1998 to 25 percent in 1999. ST Microelectronics increased its market share eight points to more than 18 percent with a 142 percent revenue surge.

"STM's success in the desktop segment came about as the company reinforced its leadership in the desktop HDD motor control segment, made a big entrance in the desktop HDD read channel business, and added three customers for its desktop controller chipset," says Xavier Pucel, program manager for IDC's Semiconductor program.

ATI has a firm grasp on first place in the PC graphics segment with $650.6 million in revenues, or 31 percent of the worldwide market. Several vendors experienced declining shipments in this segment during 1999, and IDC expects the market to continue to consolidate this year.

The microprocessor competition in 1999 was a two-pear battle that unfolded by the end of the year with Intel and AMD as the victors. During the first half of the year, Intel's aggressive positioning of Celeron resulted in the exiting of IDT, National, and Rise Technology from the low-end PC market, while AMD slowly bled in margins. By the second half of the year, AMD rebounded strongly with its new flagship product Athlon, while Intel slowly began to face supply problems and play catch up in performance against AMD.

The leading position in the flash card market belongs to SanDisk. The vendor earned a solid 90 percent growth in 1999, bringing its revenues to $196 million. However, its share dropped from 35 percent in 1998 to 27 percent in 1999, as several other vendors were able to grow much faster than SanDisk. In fact, the overall market grew at a 145 percent rate. IDC believes that while SmartMedia manufacturers Toshiba and Samsung will continue to be SanDisk's main challenge in the near term, the company, with its broad product portfolio, is well positioned to take advantage of existing as well as emerging applications for flash cards in the long run.

Conexant is the leading vendor in the overall modem semiconductor market. In 1999, it controlled 30 percent of worldwide revenues. However, IDC beli4eves, second-place vendor Lucent, with 22 percent of revenues, has a broader product portfolio. Conexant, while very strong on analog, is a relative newcomer to the broadband segment.

In the LAN ASSP segment, Intel put further distance between itself and the number-two vendor Lucent Microelectronics. Intel increased its market share to 34.5 percent in 1999, from 21.8 percent in 1998. Lucent, meanwhile, slipped from 20.5 percent to 18.9 percent. Intel's performance was significantly helped by the acquisition of Level One. IDC believes Broadcom is a vendor to watch in this segment. It increased its revenues more than 180 percent in 1999, compared with 20 percent growth for the overall market.