Boom predicted for chiplet market
The global chiplet market is set to grow at an annual rate of over 42% says a new report from Markets.us.
The research identified $3.1bn of revenue in the chiplet market in 2023, but all of this was withing single companies. Two thirds came from the launch of processors from Intel, AMD and Nvidia and the rest from networking devices from Marvell and high end FPGAs from AMD/Xilinx.
The chiplet market is expected to grow to $107.0bn by 2033, a CAGR compound growth of 42.5%, with $4.4bn predicted for this year.
Chiplets provide the flexibility to mix and match different blocks to cater to specific needs, making them ideal for a range of applications, from consumer electronics to high-performance computing and data centres say the analysts at Markets.us. The chiplets market is poised for significant growth, driven by various driving factors and opportunities. The increasing demand for advanced semiconductor solutions across multiple industries, including consumer electronics, automotive, telecommunications, data centers and AI, is a major driving factor.
- Intel launches its chiplet-based CPU and GPU
- TSMC looks to standardise chiplet protocols in ‘world first‘
- €16m project to secure the chiplet supply chain in Europe
It cites Omida with microprocessors as the largest market segment for chiplets, and the market share of microprocessors supporting chiplets is expected to grow from US$452 million in 2018 to US$2.4 billion in 2024.
Chiplets enable product designers to mix and match different components, allowing for customized ICs tailored to specific applications and using different process technologies, This is where foundry TSMC has had a major influence, looking to standardise the process of developing and combining chiplets on a substrate. The first heterogeneous devices with chiplets from different suppliers are now emerging to fuel further growth and there are key European projects to ensure that the technology for chiplets is available in the region in an open supply chain.
- World’s first UCIe heterogeneous chiplet test chip
- Socionext collaborates with ARM and TSMC on 2nm chiplet
Another driving factor is the development of a chiplet ecosystem. The market has witnessed the emergence of companies specializing in chiplet design, manufacturing, and assembly. These players provide a range of chiplet-based interconnect, devices and services, contributing to the growth of the market. Additionally, advanced packaging technologies and interconnect solutions have evolved to enable efficient chiplet integration, facilitating high-bandwidth and low-latency communication between chiplets.
The Consumer Electronics segment dominated the chiplet market in 2023, with over a 26% share. This is due to the rapid advancement of technology in laptops, high end gaming and data cetnre chipselts.
IT and Telecommunication Services segment held a 24% share. This is driven by the demand for high-performance computing solutions in data centers and the need for efficient network infrastructure.
However the report does not appear to take into account the growing impact of chiplets for the automotive industry in this timeframe.
- Major Japanese push for automotive chiplets for 2028
- ASIC platform targets automotive chiplets
- UCIe sees automotive chiplet group
In 2023, APAC emerged as a dominant force, capturing over 31% of the market share. APAC’s leading position is attributed to its advanced semiconductor manufacturing capabilities and rapid technological advancements.
The rise of Internet of Things (IoT) devices has further fueled the demand for chiplets in consumer electronics. IoT devices require components that can process and communicate large amounts of data while consuming less power. Chiplets, being more efficient than traditional monolithic chips, are well-suited to meet these requirements.
However, the chiplet market faces challenges that need to be addressed says the report.
One significant challenge is the technical complexities involved in integrating and ensuring interoperability between chiplets. Since chiplets come from different manufacturers and may have different designs and specifications, integrating them into a cohesive system can be challenging. Ensuring compatibility and seamless communication between chiplets require careful planning and development of standardized interfaces and protocols.
Another restraint in the chiplet market is the issue of heat management. When multiple chiplets are integrated into a single system, heat dissipation becomes a critical concern. As each chiplet generates heat, managing and dissipating it to maintain optimal operating temperatures can be a technical challenge. Effective heat management techniques such as advanced cooling solutions and thermal design considerations need to be implemented to address this issue.
A challenge in the chiplet market is maintaining consistent quality and reliability across different chiplet designs. As chiplets come from various manufacturers, ensuring uniform quality standards and reliability across different chiplet designs can be a challenge. Standardization of interfaces and protocols, rigorous testing procedures, and effective quality control measures need to be in place to address this challenge and ensure consistent performance and reliability of chiplet-based systems.
A further challenge is related to intellectual property (IP) protection and licensing. Different chiplet designs may involve proprietary technologies and IP, which need to be protected and properly licensed to ensure fair and lawful usage. Addressing IP concerns, establishing licensing agreements, and fostering collaboration among manufacturers and IP holders is crucial says the report.
Intel reached a significant milestone in September 2023 at the Innovation 2023 event with the introduction of Pike Creek, its first chiplet-based test chip. This signals a substantial leap forward in Intel’s incorporation of chiplet technology for forthcoming product developments.
TSMC and Intel have jointly declared a collaboration to create the Universal Chiplet Interconnect Express (UCIe) standard, aiming to establish a unified ecosystem for chiplet integration. This strategic initiative highlights the industry’s dedication to open standards in the chiplet domain.
Advanced Micro Devices (AMD) showcased two key products throughout the year 2023, with the Genoa CPU Built on a modular chiplet design and the Instinct MI300 GPU. The AMD Versal ACAP devices also feature chiplets with dedicated processing engines for AI and machine learning tasks. Nvidia also introduced the Grace CPU as a chiplet-based CPU for the server market in data cetnres.
Marvell announced its OCTEON 10X data processing unit (DPU), incorporating chiplets for high-performance networking and security applications while TSMC introduced its 3DFabric advanced packaging technology, enabling efficient interconnections between chiplets in 3D configurations.