Samsung and Apple gobble up semiconductor marketshare

Samsung and Apple's battle for supremacy continues in the semiconductor market, with both firms dominating consumption, according to Gartner.

However, Samsung overtook its biggest rival to secure the number one position, the analyst claimed.

Together, the two vendors consumed $45.3bn (£28.5bn) of semiconductors in 2012, an increase of $7.9bn from 2011 and accounting for 15 per cent of total semiconductor spend.

Masatsune Yamaji, principal research analyst at Gartner, said: "Although Samsung and Apple continue to go from strength to strength, other leading electronic equipment makers fared less well, and six of the top 10 reduced their demand in 2012.

"In addition to a weak macroeconomic situation, a dramatic change in consumer demand contributed to a reduction in semiconductor demand in 2012. The PC market still represented the largest sector for chip demand, but desktop and mobile PCs did not sell well, as consumers' interest shifted to new mobile computing devices such as smartphones and media tablets.

"This shift caused a substantial decrease in semiconductor demand in 2012, as the semiconductor content of a smartphone or a media tablet is far less than that of a PC."

The top 10 companies demanded $106.4bn worth of semiconductors in 2012, accounting for 36 per cent of total revenue, which amounted to $297.6bn.  Of the top 10, Nokia's demand contracted the most.

Yamaji added: "While the growth of new mobile computing devices, notably smartphones and media tablets, has not fully compensated for the drop in the semiconductor demand from the PC market, the datacentre and communications infrastructure market will keep driving semiconductor demand.

"The limited computing and storage resources of new mobile computing devices will be compensated for by cloud computing services with light application software."

He added: "Price competition between smartphone and media tablet vendors was severe in 2012, as hardware differentiation was very difficult to achieve. Innovations in device hardware will soon be copied by competitors, as semiconductor vendors will soon provide commercial SoC (system-on-chip), software and reference designs to hardware vendors needing to catch up with innovative market leaders. Semiconductor vendors must aid, or at least monitor, the hardware innovations of the market leaders."

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