Apple plays powerful role in rapidly growing space
Apple Inc.’s tremendously influential iPhone helped spark the market for microelectromechanical systems (MEMS) microphones to new heights, causing MEMS microphone shipments to nearly quintuple in just three short years, according to an IHS iSuppli MEMS market brief from information and analytics provider IHS.
Shipments of MEMS microphones reached an estimated 2.06 billion units in 2012, up by a factor of 4.8 from 432.9 million units in 2009. While MEMS microphones have been around for many years, 2009 marked an important milestone when Apple started to buy MEMS microphones for the iPod nano 5, and more importantly, for the iPhone 4. With Apple playing a huge role despite not being an early adopter, MEMS microphone shipments jumped to 696.4 million units in 2010, and then surged to 1.3 billion units the following year. Apple’s share of MEMS microphone shipments rose from just 6.2 percent in 2009 to an outsized 30.8 percent in 2012.
One of the great success stories in the MEMS field, silicon microphones have found their use broadening over the years in what has become a fast-growing market. While a smartphone or feature phone may need one accelerometer, compass and gyroscope each, two MEMS microphones for a smartphone is typical—up from just one microphone two years ago. Even more remarkable, handset suppliers are now considering the use of three or more MEMS microphones for additional benefits, such as greater support for noise suppression as well as HD-quality audio recording for videos.
The emphasis on clearer sound is much more pronounced today, especially because handsets have become versatile tools for other tasks, such as listening to music or recording video, in addition to their original purpose for making phone calls. Acoustics, in fact, remains one of the few ways in which handset manufacturers can differentiate their phones. For instance, the new Nokia Lumia smartphone touts its audio performance and high-quality recording as an important feature setting the handset apart from competitors. And in a high-profile move a year ago, Apple introduced its Siri voice command feature in the iPhone 4S that was then carried over to the iPhone 5 and included in other Apple products, such as the fifth-generation iPod touch music player and the iPad fourth-generation tablet.
The voice command in Siri, in particular, was a breakthrough that held significant implications for MEMS. While voice command has been around for more than 10 years, Siri demonstrated the impressive functionality that could be achieved by multiple MEMS microphones featuring a lower signal-to-noise ratio.
The inclusion of more microphones in handsets has also improved video recording in cellphones. For instance, a third microphone from Analog Devices in the newest iPhone version dedicated to video recording has boosted the quality of video recording. Prior to the addition of the third microphone, two microphones from Knowles and AAC had been implemented on the side of the display, not on the side of main camera, which made for superb video but not-so-great audio.
MEMS prospects healthy moving forward despite fractious history
In a clear illustration of the high value of the MEMS microphone space, the fast adoption of MEMS microphones has come about without a corresponding price reduction of the device, defying a trend that usually occurs in fast-growing applications for the consumer and mobile markets.
Unlike accelerometers, the price of MEMS microphones has held up, mainly because the high-end segment—typified by the likes of Apple and Nokia handsets—is not purely driven by price. Apple, for instance, pays anywhere from three to four times more than its competitors to secure performance-oriented MEMS microphones, helping to stabilize pricing for MEMS microphones as a whole.
The MEMS microphone field is strewn, however, with failed efforts and costly intellectual property wars. Bloody IP exchanges have ensued between Knowles, the dominant MEMS microphone player, with other manufacturers, such as ADI and Memstech, especially as Knowles holds generic patents on the packaging of MEMS microphones that have proven hard for competitors to get past.
The road has also been rough for some when it came to target pricing. Many companies have produced MEMS microphones in only small volumes—unable to break through because their devices are considered too expensive—or have folded up completely.
Aside from Knowles, Infineon is the other major manufacturer of MEMS microphones, projected to have supplied 30 percent of all MEMS microphones last year, up from 7 percent in 2009. After giving up on the idea of selling packaged MEMS microphones in 2009, Infineon concentrated on selling MEMS die and application-specific integrated circuits to electret condenser microphone companies like AAC, Goertek, BSE and Hosiden.
Infineon’s increasing success with this approach has filled the need for a second source in MEMS microphones in addition to Knowles, providing buyers like Apple with alternative sources, even as Apple has indicated expanding its search to other suppliers in order to mitigate sourcing risks.
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