Semiconductor Sectoral Analysis
The Semiconductor market within the EU is immensely important to the continued recovery of the Euro-Zone in general. The industry is starting to ebb away from its' European dependence due to the uncertain economic situation within Europe and the increased levels of IT development in developing nations. The expected growth within the sector is not isolated to China and the U.S. as it has been in the past, European development is expected to increase. The semiconductor market it moving away from its dependence on the computer industry and into other industries that offer great prospects for the EU. Automotive and telecommunications industries are expected to increasingly demand semiconductors making the area of application for semiconductors more diverse allowing for profits to be sought out by companies that were able to predict this trend. The ability to successfully create semiconductors that are matching the new industries demands relies heavily upon multiple factors including supply chains allowing for already established institutions within Europe to maintain profits without innovation due to their institutional foundations. This report will give a broad analysis of the semiconductor sector within the EU and the global market, and to better understand the reasons why European companies are expected to succeed a singular product will be looked at.
The semiconductor industry is the single most capital intensive in the world making it highly responsive to economic fluctuations (Millard, 2014, p. 5). Due to the diversification of the market and the ability of semiconductors to be placed into a plethora of new products, the industry has witnessed non-stop growth through the last fifty years. It has grown from 2% in 1960 to 20% in 2000 due to its applicability in almost all new products (Millard, 2014, p. 5). The sector is one of the most competitive in the world and has witnessed immense performance improvements as a...