Smarter appliances mean more chip sales


You know those GE(s ge) connected ovens? Or the quiet cycle on your dishwasher? As appliance makers seek connectivity and improvements in noise and energy efficiency, the sales of chips destined for appliances will hit $2.6 billion when the year concludes, a growth rate of nearly 12 percent over the year before. Appliances aren’t just better, they are also selling in more geographic regions, leading to a larger overall market.

The current growth rate is almost double the growth rate from 2012, according to data from research firm IHS iSuppli. And those double-digit increases will continue in 2014 and 2015, after which growth will settle down to the still-high 9 percent range during the following two years. By 2017, semiconductor revenue for this market will be worth $3.8 billion.

Now not all of these chips are related to wireless connectivity and intelligence — the biggest growth will actually come from power management chips to govern motor operation to add more efficiency and quieter cycles. Instead of the smart home, this might be a function of more open floor plans.

As for intelligence, it’s in there, as can be seen by the growth of higher function 32-bit microcontrollers gaining ground — although the traditional 8-bit microcontrollers will still dominate the market. That growth of 32-bit microcontrollers will be a boon for ARM(s armh), which doesn’t have lower bit-rate MCUs. IHS estimates that total microcontroller revenue will reach an estimated $700 million by the end of this year.

Beefier brains in appliances are a result of improved touchscreens and programmed cycles as well as a function of adding connectivity, Room air conditioners and washing machines are the largest users of semiconductors, accounting for more than 60 percent of the industry’s chip revenue in 2013. This explains why my new washer has a dedicated pet beds and stuffed toys cycle that I never use.


Barun Kumar De

The biggest gainer of this Smarter Appliances business will be low power AFE manufacturer

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