SIA sees average annual microchip growth at 9 pct through 2009

Semiconductors sales are set to rise at a compound annual rate of 9 percent through 2009 on strong consumer demand for personal computer memory and electronics products such as music players, an industry group said on Thursday.

The Semiconductor Industry Association (SIA) forecast sales increases of 9.4 percent to $248.8 billion this year, 10 percent to $273.8 billion in 2007, 10.8 percent to $303.4 billion in 2008 and 5.8 percent to $321 billion in 2009.

Besides the growing cell phone and digital music player markets, the semiconductor industry is also benefiting from rising consumer demand for products like cameras, high-definition televisions, automobiles with advanced electronics and high-performance computers for video gamers, SIA President George Scalise said in a Web cast.

The association said it expected unit sales of mobile handsets to climb over 20 percent this year to more than 1 billion. With an average of $41 worth of chips in each handset, cell phones are now the second-largest user of semiconductors after personal computers, the SIA said.

Sales of microprocessor chips, which run computers, are expected to fall 5 percent this year to $33.2 billion, although the SIA forecast that would grow to $41.9 billion in 2009.

IDC analyst Mario Morales said the microprocessor segment's dollar sales figures have been hurt by a pricing war between Intel Corp. and Advanced Micro Devices Inc. that has kept unit prices down.

In its annual forecast for the industry, SIA also said it expected sales of DRAM, or dynamic random access memory, for personal computers to climb 29 percent to $33 billion this year, rising to $44.2 billion in 2009.