November DSP chip shipments were up a modest 2.5% in revenue terms, with cellular DSP (mostly baseband chips) up 6%, according to Forward Concepts. FC sees December shipments to be even better, boosting quarterly shipments up an estimated 4.8%, as illustrated in the chart.  FC believes that shipments for the year will be down only 5% to the $7.9 billion level, compared to its earlier more pessimistic forecast of -9% for all of 2007.

The Multipurpose shipment increase is largely attributable to video applications, like Texas Instruments' DaVinci line of chips.  Computer is primarily DSP for HDD controllers, and Wireless is mostly for cellphones, which has seen a late-season improvement.  Wireline continues to be lackluster, while Automotive and Consumer shipment shortfalls appear to be short-term situations.

FC expects significant changes in DSP chip reporting beginning in 2008, likely necessitating to change the way it accoutns for DSP market shares.  Several companies that have previously reported their products as "DSP chips" will likely now report them as "ASICs," under sub-categories of wireline, cellular, computer, etc.  In short, DSP silicon is loosing its identity as a separate "DSP chip" category.

For example, Agere Systems, first acquired by LSI Computer for its (DSP-based) hard disk drive (HDD) controller line, has had its (DSP-based) cellular operations acquired by Infineon.  Infineon has no catalog DSP chips in its portfolio and has long reported its DSP-based silicon (mostly as cellular basebands) as ASICs. Consequently, absorbing the Agere wireless product line (previously reported as DSP chips) will likely result in zero "DSP chips" being reported by Infineon in the future.  And, LSI Computer may report shipments of its now-substantial HDD chip line as ASICs, too.

Then there is the MediaTek acquisition of Analog Devices' cellular product line.  DSP shipments from that product line will no longer be including in ADI's finances, and MediaTek will likely report those products as ASICs, as well.  The net result will likely be a diminished size of the reported "DSP Chip Market", and an increase in the DSP-based "ASIC cellular, ASIC computer, ASIC wireline, etc. Markets."  However, the overall "DSP silicon" shipments will continue to increase because without DSP (technology) there would be no digital wireless, no digital multimedia, no VoIP, and no HDTV. 

Contact:
Will Strauss, president, Forward Concepts,  wis@fwdconcepts.com, Tel: (480-968-3759)