Breakthroughs and opportunities in the semiconductor industry driven by AI

2024/08/23

Business Times
August 07, 2024
Author: Industrial and Commercial Times Industry Analysis

"In 2023, the global semiconductor market will reach US$526.9 billion, and is expected to grow to US$611.2 billion in 2024, with an annual growth rate of 16%. Among them, the development of AI has jumped from decision-making AI to generative AI, which is a very critical reason. ” Fan Zhehao, manager of the Industrial Technology International Strategy Development Institute of ITRI, pointed out that the rapid development of AI is bringing about great changes in human life, whether it is generative video technology or technology that enables large language models (LLM) to have visual and auditory capabilities. All of this shows that AI still has great potential that has yet to be realized.

Fan Zhehao believes that although the global semiconductor market has experienced some fluctuations in 2023 due to the impact of inflation and weak end market demand, the overall recovery trend this year has not changed. The rise of generative AI has not only driven server demand, but also further Expand to smart applications on various devices.

●More terminal applications will drive demand for AI servers

"Generative AI will gradually be applied to more terminal devices, driving a new wave of demand for AI servers. AI PCs and AI mobile phones will become new driving forces for the growth of the terminal consumer market." Fan Zhehao said that generative AI technology has grown rapidly in recent years. The rapid development has brought new development opportunities to the semiconductor industry, which not only drives demand for servers, but also drives a wide range of applications including smartphones, personal computers, and various Internet of Things (IoT) devices. In the future, market demand will be more diversified, because these application scenarios require higher-performance semiconductor components. Under this trend, major international manufacturers have invested in the research and development of high-performance computing (HPC) chips and the layout of the application market, thus promoting the entire semiconductor industry. Market demand grows.

The IC industry is also facing new development opportunities in the era of generative AI. Wang Xuanzhi, an industry analyst at the International Institute of Obstetrics and Mechanics of the Industrial Research Institute, cited data and said that the global IC design market size has reached US$234.5 billion in 2023 and is expected to grow to US$276.5 billion in 2024, with an annual growth rate of 18%. Although the market is growing rapidly, it also brings considerable challenges to the IC design industry.

"IC design companies should pay attention to the balance between technological innovation and market demand," Wang Xunzhi said. Thanks to the generative AI boom, the market's demand for chips that can quickly process large amounts of data and have high performance has increased significantly. IC design companies must continue to improve their technology. level to meet the market's desire for chips with higher performance and lower power consumption.

●IC design industry welcomes diverse applications and must strike a balance between innovation and demand

However, the flourishing of diverse applications also makes IC designers face more variables and uncertainties. Different application scenarios have different requirements for chips, such as smart phones, personal computers, Internet of Things devices and other applications. Designs are all different. IC designers must continue to innovate and have the ability to respond to market changes more flexibly and quickly. As a result, the market is more difficult to predict and costs are more difficult to control than before.

"Only by finding a balance point can we remain invincible in the market." Wang Xunzhi made suggestions for the business strategy of the IC design industry, which is to strengthen cooperation with upstream and downstream companies to form a complete ecosystem to enhance market competitiveness.

Liu Meijun, an industry analyst at the International Institute of Obstetrics and Mechanics of the Industrial Research Institute, proposed that the IC design industry needs to pay most attention to the four key technologies in the era of generative AI, namely heterogeneous integration, high-efficiency packaging technology, silicon photonics manufacturing technology, and dedicated AI acceleration. Processor (AI Accelerator).

"In generative AI systems, data center servers are faced with the challenges of rapidly increasing data volume, urgent need to expand bandwidth, and skyrocketing power consumption." Liu Meijun pointed out that whether it is generating text, images, music, etc., generative AI The booming development of AI continues to exceed people's imagination of AI. The dedicated AI acceleration processor is a chip specially designed to accelerate AI operations. Its application range includes smartphones, personal computers, Internet of Things devices and data centers, etc., meeting the needs of various industries. Such complex AI application scenarios require large-scale data processing and high-performance computing, which significantly improves the computing speed and efficiency of AI models.

Silicon photonic manufacturing technology based on optoelectronic integration can significantly increase data transmission speed and reduce power consumption, which is crucial for building high-performance, reliable generative AI systems. Liu Meijun added that these technological advances can not only improve computing efficiency, but also reduce energy consumption and operating costs, further promoting the widespread application of generative AI in various industries, thereby bringing greater business value and market opportunities.

Talking about the future prospects of the semiconductor industry, Fan Zhehao believes that the semiconductor industry is facing unprecedented opportunities and challenges. Generative AI is not only driving the growth of server demand, but also stimulating the growth of personal computers, smart phones, and Internet of Things devices. and the development of more terminal devices. While witnessing the diversification of AI applications, it is foreseeable that innovative semiconductor technologies will continue to be developed, allowing the overall industry to maintain a strong growth momentum.

"Generative AI will continue to promote the rapid growth of the semiconductor industry, forming a virtuous cycle that complements each other." Fan Zhehao said, from heterogeneous integration to high-performance packaging, to silicon photonics technology and 3D packaging, every technology progress is driving the entire semiconductor industry forward. In the future, with the application of more innovative technologies and the release of market demand, the semiconductor industry will continue to maintain a strong growth momentum and the business opportunities are unlimited.

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