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AUGUST 2019        TAP TIMES          -10-          Historically, the driving force behind the
                                                                higher average annual growth rate of the
                                                                semiconductor industry as compared to
              Semiconductor content in                          the electronic systems market is the in-
            systems may decline 26.4%                           creasing value or content of semiconduc-

                                                                tors used in electronic systems.

        SCOTTSDALE, Arizona—IC Insights
        forecasts that the 2019 global elec-                    Increased content and value
        tronic systems market will grow 4                       With global unit shipments of cellphones,
        percent to $1,680 billion in its mid-                   automobiles, and PCs showing maturity
        year update to the McClean Report.                      and slowing over the past 10 years, the

                                                                disparity between the 3 percent 2008-
        In contrast, the worldwide semiconductor                2018 CAGR registered in the electronic
        market is expected to drop by 12 percent                systems market and the 7 percent 2008-
        this year to $443.8 billion after exceeding             2018 CAGR displayed by the semiconduc-
        the $500.0 billion level for the first time             tor market is directly due to the increased
        last year.                                              content/value of semiconductors in elec-
                                                                tronic systems.


        Chip content will decline                               While the trend of increasing semiconduc-
        If the 2019 forecasts come to fruition,                 tor content has been evident for the past
        the average semiconductor content in an                 30 years, the big jump in the average
        electronic system will drop to 26.4 percent             semiconductor content in electronic sys-
        after setting the all-time record of 31.1               tems in 2017 and 2018 was primarily
        percent last year (Figure).                                                                    Next page
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