This, our eleventh-edition market-share report, covers wired communications ASSPs, embedded microprocessors, and FPGAs. Our coverage of wireline technologies includes major product markets such as Ethernet and broadband. We also provide breakouts for the sales of embedded processors and FPGAs for use in communications systems. For completeness, we include merchant server processors, which are sometimes used instead of embedded processors.
This report tracks processors and networking chips used in wireless-infrastructure equipment. A separate report, Mobile Semiconductor Market Share Forecast, covers processors and wireless chips that appear in mobile client devices such as smartphones and tablets.
At the top level, the communications semiconductor industry eked out 1% growth in 2015 following nearly 8% growth in 2014. Broadband stood out with the best growth, but Ethernet grew as well. Together, the two largest segments more than offset declines in the aggregate of other segments.
The total market for Ethernet ICs grew only 1.6% in 2015. The standard for PC connections, Gigabit Ethernet (GbE) components made up 51% of sales. The Fast Ethernet (10/100) segment stabilized at 8% of 2015 total Ethernet chip revenue thanks to its expanded use in embedded designs. Growth in sales of 10G Ethernet (10GbE) ICs slowed to 11% in 2015, reaching 39% of overall Ethernet chip revenue. These figures include only chip-level revenue; we report sales of network interface cards (NICs) separately.
Broadband ICs had a mixed year, with PON growing quickly while cable-modem revenue was about flat and DSL declined. Massive Chinese deployments dominated the PON market in 2015. These deployments have been in waves modulated by government policies. The latest wave resulted in 18% growth in 2015 following a very strong 2014. Revenue from DSL CPE chips declined as VDSL2 growth failed to offset a steep decline in ADSL shipments. Following 2014 growth, cable-modem IC growth paused in 2015 as operators prepared to deploy DOCSIS 3.1 in 2016.
Top 5 Communications ASSP Suppliers
With more than 40% share, Broadcom is undisputedly the overall leading supplier of communications ASSPs. The company is by far the top supplier of Ethernet and broadband components, the two largest categories of communications ASSP. Broadcom’s leading position in the 10G Ethernet switch segment drove share gains in overall Ethernet chips while its PON chips drove broadband-revenue growth. We rank Avago, which completed its acquisition of Broadcom in 2016, separately at number 10.
Second-place Intel acquired Lantiq in 2015, adding DSL and PON chips to its broadband portfolio. After restating our 2014 estimate to include Lantiq, Intel underperformed the overall market. Still, the acquisition resulted in a 29% revenue increase in 2015 as compared with our previous Intel estimate for 2014. Intel’s existing Ethernet business performed well in 2015, growing slightly faster than segment-leader Broadcom.
Marvell lost overall share owing primarily to ongoing share losses in Ethernet chips. The company lost share in the mature Gigabit Ethernet market, and, more importantly, has little share in the growing 10G Ethernet market. Marvell has only a small presence in broadband, where it supplies CPE chips for PON. The company’s overall communications ASSP revenue dropped 8.6%.
Fourth-ranked Qualcomm, which acquired Ikanos in 2015, grew inline with the overall market. The company’s major growth driver is home networking ASSPs; it is the leading vendor of chips for the HomePlugAV powerline networking standard. Other segments - including the Ikanos DSL business - declined in 2015.
Moving into the fifth spot is Microsemi, which acquired Vitesse in 2015. Unfortunately, the acquired business shrank, resulting in a 10.5% revenue decline over our restated 2014 estimate. In 2016, Microsemi acquired 11th-ranked PMC-Sierra; the combined companies posted more communications revenue than Qualcomm.
Embedded Processors and FPGAs
Intel is unchallenged as the number-one embedded-processor supplier commanding more than 40% revenue share, and it gained share in 2015. NXP entered this market through its acquisition of Freescale, which lost share in part due to a slowdown in the wireless-infrastructure market. Posting a revenue decline, NXP ceded its position as the largest supplier of processors to the communications market to Intel. Broadcom held third place in overall embedded processors, whereas Cavium was third in processors sold into communications.
Overall FPGA revenue shrank 11% in 2015, and sales into communications fared even worse. Top-ranked Xilinx performed only slightly better than the overall market. Intel completed its acquisition of Altera, which suffered a steep decline in the communications segment. Although it is far smaller than the leaders, Microsemi gained FPGA share in 2015.