Sensors are a small but growing part of the worldwide semiconductor market, expected to grow faster than any market segment except memory chips, according to the Semiconductor Industry Association. Sensor chips record physical input like temperature, pressure or light, and convert the input to an electrical signal. The SIA says the worldwide market for sensor chips is was worth $8 billion last year, less than 5% of the overall chip market.
This year the sensor market is projected to grow 4.5%, and next year the market is expected to grow 7.1%. Sensors are benefitting from growth in machine-to-machine applications. Right now the automotive sector is one of the biggest users of sensor chips, but interest is growing in many other industries, from home health care to parking meters to wireless base stations.
3M included sensor chips when it created its newest product for macro base stations – its tower dome terminal for connecting fiber to the antenna includes two sensor options. “We are bringing intrusion sensors, if that’s what customers need, in the way in which if you open the closure a signal will be sent to the central office,” said 3M’s Omar Flores. “We are also adding moisture sensors.”
Right now, most wireless sensors are not required to handle volumes of data that require 4G, or even 3G connections. “If you look at M2M, the vast majority of solutions still only require 2G speeds,” said RACO Wireless president John Horn. “The majority of solutions out there on the market today are only passing kilobytes of information, not megabytes and gigabytes, so 3G and 4G aren’t really that necessary for a lot of connections.” But Horn added that one notable exception in RACO’s partner portfolio is the Audi Connect service. He said some cars are currently using 30 gigabytes of data per month.
M2M analyst James Brehm of Compass Intelligence thinks more and more intelligent machines will require 4G connections. “For anybody doing a deployment today, if they are not looking at 4G they are missing the boat,” he said. “You may deploy a solution today that does not need high bandwidth but six to 12 months down the road you’ll see that you can include video or increase the number of times the sensor reports, if you have the capability.”
Growing demands for sensors is good news for market leaders Intel, Freescale and Texas Instruments, but there is also room for smaller players. Proteus Digital Health recently created an ingestible sensor that monitors body functions. Pinoccio is a Michigan startup that has made a programmable chipset for home automation.
“I really see this industry as having the longest tail of any industry out there,” said Horn. “There are going to be thousands of solution providers that are going to change industries. Those providers may have just a few thousand devices, not millions, and those devices are going to change the way that industry does business.”
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