Advanced IC Substrate Market

Market Overview

The global advanced IC substrate market size was valued at USD 9.44 billion in 2023. It is expected to reach USD 17.32 billion in 2032, growing at a CAGR of 6.98% over the forecast period (2024-32). As electronic devices become smaller and more compact, there is a growing need for advanced IC substrates that can accommodate densely packed integrated circuits (ICs). These substrates enable the miniaturization of devices while maintaining performance and reliability.

With the proliferation of new IC types such as BGA (ball grid array) and CSP (chip scale package), which require different package carriers, IC substrate has been evolving. IC substrates connect the IC chip(s) and the PCB via a network of conductive traces and holes. Substrates for integrated circuits support vital functions, such as circuit support and protection, heat dissipation, and signal and power distribution. Packaging is an essential aspect of modern ICs. Similar to the circuit boards they attach, they need a particular substrate. In addition to shielding the exposed IC, the substrate facilitates connections between the IC and the network of traces on the PCB. As such, the substrate has a substantial effect on circuit performance. They consist of multiple layers and a central support core. In addition, the IC substrate has a network of conductor pads and drill holes. Frequently, their density exceeds that of typical PCBs. Thus, their fabrication can be somewhat tricky.

In addition to offering mechanical and physical support, IC packaging is also in charge of connecting the chip to external terminals such as printed circuit boards (PCB). The encapsulation aids in stopping physical deterioration and corrosion of the metallic components. The kind of package utilized to make an IC depends on several factors, including power dissipation, size, price, and other criteria. Due to the rise in demand for 5G capable smartphones and smart wearables globally over the upcoming years, it is anticipated that the need for sophisticated IC substrates will rise even higher. Both the consumer and industrial sectors drive global IoT demand since both are seeing an increase in demand due to the technology's expanding application.

Market Dynamics

Global Advanced IC Substrate Market Driver

Increasing Usage in Manufacturing IoT Equipment

The global demand for IoT is bolstered by both the consumer and industrial sectors, as the rising implementation of the technology in both sectors drives the demand. Vendors are making IoT-specific chipsets because of the increase in demand. Altair, Huawei, Intel, Qualcomm, Samsung, Sierra, and many other leading IoT chipset manufacturers are only a few of the market's players. The demand for chips used in IoT device development is anticipated to rise throughout the estimated period due to the growing number of IoT devices. The innovation in lowering energy usage will also be a top goal for manufacturers, along with chip shrinking.

The IoT improvements benefit the producers of IC substrates. Apple, for example, planned on employing TSMC's antenna in package technology and ASE's FC AiP process to package mmWave antenna for its 5G iPhones and 5G iPads, which they launched in 2020. The expansion of IoT has led to increased adoption of the newest semiconductor packages, which can improve IC performance and reduce cost in various situations.

In response to the growing demand, vendors are producing more IoT-specific chipsets. A few well-known IoT chipset producers on the market are Altair, Huawei, Intel, Qualcomm, Samsung, and Sierra. The adoption of the most recent semiconductor packages has increased along with the Internet of Things, which can enhance IC performance while reducing prices in various circumstances. Smart industrial automation, also known as Industry 4.0 and IoT, is a new technology strategy for creating, manufacturing, and managing the complete logistical chain. The substrate market will experience significant growth due to Industry 4.0 and IoT acceptance in manufacturing.

Global Advanced IC Substrate Market Restraint

Complexity of Process

When a board has a thickness of less than 0.2 mm, the IC substrate is thin and readily distorted, especially in protruding situations. Breakthroughs in board shrinking, lamination parameters and layer positioning technologies are required to manage substrate warpage and lamination thickness and get around the challenges. Furthermore, it is challenging because of the expenses associated with maintaining ideal levels of physical, electrical, and thermal restrictions.

Flip chips have not proven a cost-effective packaging solution despite their advantages, such as higher thermal and electrical performance, the highest I/O capabilities, and substrate flexibility for different performance needs. The higher costs are felt throughout the process, from wafer fabrication's repassivation and redistribution (RDL) through the substrate vendor's high-performance multilayer organic build-up substrates. The flip-chip packaging becomes an expensive choice when assembly charges are included. These elements limit market expansion.

Global Advanced IC Substrate Market Opportunities

Trend for Miniaturization in Semiconductor Devices

The ability to purchase goods with different purposes on a single platform has been made possible by quick technical improvements. The demand for compact and reliable semiconductor devices has grown due to developments in computing, networking, telecommunications, and consumer electronics. This has driven the demand for the materials required to create high-performance semiconductor components. For space and downsizing savings, portable electronic equipment also needs smaller and thinner packaging techniques. The need for increased electrical performance to reduce noise impacts is also evident because of highly integrated, high-speed applications like aerospace and some consumer devices.

The role of IC packaging is increasingly important in developing electronic systems as a result of these factors for developing the final products. There is a growing need for small electronic devices in every industry, whether communication, automotive, industrial manufacturing, or medical equipment. Micro electro-mechanical systems (MEMS) and 3D chip packaging have emerged due to the pressure on semiconductor IC producers to spend more on research and development to make ICs smaller and more effective, resulting in the development of potential opportunities for the advanced IC substrate industry.

Regional Analysis

Preponderance of Asia-Pacific

Region-wise, the global advanced IC substrate market is analyzed across North America, Europe, Asia-Pacific, and the Rest of the World.

Asia-Pacific will command the market during the forecast period, with Taiwan as its top country, expanding at a CAGR of 6.2%. Taiwan occupies a substantial proportion of the market for advanced IC substrates due to the sheer quantity of producers and rising investments in the country's semiconductor industry. Some key producers, such as ASE Group, Unimicron, and Kinsus, are based in Taiwan and experiencing rapid production rates. The IC industry in Taiwan has a complete supply chain, from upstream IC design to downstream IDM and IC packaging and testing, as well as a skilled division of labor.

In Taiwan, there were 120.7% more mobile connections in January 2021 than there were people. Furthermore, the 5G rollout has increased across the nation. For instance, Chunghwa Telco, a significant telecom company, declared its intention to deploy 10,000 5G stations across Taiwan by the end of 2021. The business announced that the development of its 5G network is progressing ahead of schedule. The growth is consistent with the assistance provided by the government.

Japan also contributes to the Asia-Pacific advanced IC substrate market. As the home of some significant IC chipset makers and the electronics sector, Japan occupies a prominent place in the semiconductor industry. The nation recruits firms and forms alliances with other countries to grow its semiconductor sector. For instance, the nation intends to provide considerable financial incentives to secure supplies for essential components, according to a draft growth strategy unveiled in 2021. Most of the nation's domestic semiconductor demand is met by imports. Still, as part of its growth strategy, the government promotes high-tech semiconductor design, research, and manufacture.

North America will advance significantly throughout the forecast period. The sheer number of businesses operating in the United States, including Apple Inc., Dell Technologies, Intel, and others give the nation a considerable market share for advanced IC substrates. As a result, the country commands a significant portion of the global electronic sector. The region's electronics industry is expanding steadily and has a significant presence in several businesses engaged in the design and fabless manufacturing. The US Census Bureau projects that by 2023, the US semiconductor and other electronic component industries will generate USD 105.16 billion in sales. The need for sophisticated IC substrates is growing along with the semiconductor industry.

Segmental Analysis

The global advanced IC substrate market is classified by type, application, and region.

Type-wise, the global advanced IC substrate market is segmented into FC BGA and FC CSP.

The FC BGA section is projected to advance at a CAGR of 7.37% and hold the largest market share over the forecast period. A flip-chip ball grid array (FC BGA) is an advanced ball grid array with properties similar to the ceramic substrate (CBGA). Still, FC BGA uses bismaleimide triazine (BT) resin instead of ceramic substrate. This also contributes to a decrease in total expenses. The significant benefit of FC BGA is the shorter electrical pathways compared to other BGA types, which result in increased electrical conductivity and faster performance.

The FC CSP section will hold the second-largest market share. Significant factors pushing the adoption of the flip-chip chip-scale package are the rising scope of smartphones and the growing need for smart wearables (FC CSP). CSPs are significantly more space-efficient than conventional BGA electronic packaging technologies. As smartphone makers broaden the scope of sophisticated technologies for mobile applications, semiconductor packaging businesses are becoming more interested in advanced silicon (Si) nodes technology (down to 7nm), reduced power consumption, and enhanced efficiency. As a result, the FC CSP is observing a rise in the use of mobile devices to meet these stringent requirements.

Application-wise, the global advanced IC substrate market is segmented into Mobile & Consumer, Automotive & Transportation, IT & Telecom, and Others.

The Mobile & Consumer section is projected to advance at a CAGR of 6.8% and hold the largest market share over the forecast period. The rising functionality of consumer electronic items and the increasing acceptance of smart devices and smart wearables are the primary factors driving the adoption of advanced IC substrates. Increasing adoption of high-performance mobile devices (including 5G) and increased penetration of advanced technologies such as AI and HPC drive the demand for advanced IC substrates.

The IT & Telecom section will hold the second-largest market share. Increasing investments in 5G infrastructure, the growing number of data center servers and Internet of Things (IoT) connections, and the development of networking devices are some of the major factors driving the growth of the market's IT and telecom segment. The market's vendors have great opportunities due to the data center industry's rapid growth.

Recent Developments

• July 2024 - With the release of their glass substrate suite, Onto Innovation Inc. (NYSE: ONTO) showcased their JetStep® X500 panel-level packaging lithography system and Firefly® G3 sub-micron automatic metrology and inspection system. The former boasts hybrid substrate handling capabilities, while the latter is ideal for panel-level packaging and advanced integrated circuit substrates (AICS).
• May 2024 - DuPont exhibited the entirety of its line of cutting-edge circuit materials and solutions at the Shanghai International Electronic Circuits Exhibition in 2024. DuPont, which offers products in the areas of fine line, signal integrity, power, and thermal management, was displayed from May 13 to May 15 at Booth #8L06 at the National Exhibition and Convention Center (NECC).