Audio Semiconductor Market Achieves Loud and Clear Gains in Cellphones

A better sound experience is the aim, especially for smartphone users

April 29, 2013 -- Driven by their capability to improve sound quality and boost language-recognition user interfaces such as Apple’s Siri, audio integrated circuits (IC) are set for expansive growth in cellphones, with chips for noise reduction and natural speech expected to be the biggest uses during the next five years, according to an Audio IC report from IMS Research, now part of information and analytics provider IHS.

Cellphones are the single biggest application space for audio ICs, led by adoption in smartphones. Revenue in the two audio IC segments for smartphones—audio signal-processing ICs and audio input and output ICs for silicon microphones—will increase by consistent double-digit margins in an unbroken run extending from at least 2011 until 2016.

For instance, audio input and output ICs for silicon microphones in smartphones will take in $322.8 million this year, up from $193.9 million in 2011, on their way to $540.5 million five years later in 2016. Growth this year stands at 24 percent.

Revenue for the audio signal-processing IC segment also displays the same kind of bullish expansion. In the non-core-based class of ICs spanning application-specific integrated circuits as well as application-specific standard products, revenue this year is forecast to reach $779.6 million, up from $469.8 million in 2011, and headed toward $1.3 billion by 2016. The 24 percent increase this year equals that of the audio input and output IC segment.

Growth in the audio IC market is heavily influenced by the demand for media-consumption devices. And with media content now ubiquitously stored in such systems as the Internet cloud and then delivered digitally, the ecosystem for audio content consumption is also evolving, centered on a user experience accustomed to obtaining instant access to new content.

This type of easy access, in turn, is driving the growth of audio playback systems in portable device markets such as mobile PCs, tablets and especially handsets. Cellphones alone accounted for 24 percent of revenue—nearly $1 billion in value—attributable to audio semiconductors in 2011, in the process becoming the single largest application for audio ICs.

Two growing trends: noise cancellation and natural speech

With the consumption of personal entertainment via portable devices becoming the norm, audio semiconductor companies for their part have been striving to give users a better audio experience. In particular, applications such as active noise cancellation and speech recognition are finding their way into new designs, with the most successful applications integrated into silicon in order to free up the processor for additional features, or to reduce overall power and cost with a more efficient processor. 

In the case of noise cancellation, microelectromechanical systems (MEMS) microphones are being deployed to distinguish between sound emanating from a user and sound coming from a user’s surroundings. In very high-end smartphones, for instance, a complex processor-based multidimensional algorithm is sometimes used in the receiving device to cancel ambient noise. The method can even be employed in the receiving device to cancel ambient noise surrounding the transmitting device.

With natural speech, the technology has also grown in leaps and bounds since the time of limited voice-activated controls that produced sound of mediocre quality. Starting with smartphones such as the Apple iPhone with Siri as well as the Samsung Galaxy S, speech recognition in smartphones can now recognize and respond to natural questions and commands, not just preprogrammed phrases.

Natural speech functionality is expected to penetrate heavily into other smartphones over the next five years, IHS believes. Moreover, the technology is sure to enhance new applications like wearable electronics, automotive driver assist and voice-sensitive security in the near future.

Given innovative developments of this sort on the horizon, perhaps futuristic voice control such as Star Trek insignia communicators, Dick Tracy watches and Iron Man’s Jarvis interface can’t be that far behind.

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