Key Market Overview:
Semiconductor IP Market is estimated to reach over USD 9.41 Billion by 2030 from a value of USD 4.87 Billion in 2022, growing at a CAGR of 8.30% from 2023 to 2030.
Semiconductor IP, or semiconductor intellectual property, refers to pre-designed, reusable IP Types or modules that are used in the development of integrated circuits (ICs) or semiconductor devices. The IPs include processor cores, memory compilers, interface IPs, and other specialized IPs including digital signal processors, encryption engines, and imaging processors. The IPs are widely used in the semiconductor industry to enable chip designers to reduce production time and costs by reusing pre-existing IPs instead of designing new.
Semiconductor IPs are licensed from IP providers, that specialize in developing IPs or larger semiconductor companies that have in-house IP development capabilities. IP providers usually levy a one-time licensing fee or a royalty on the usage of their IPs, after which the licensees are free to integrate those IPs into their own chip designs. In addition, increasing adoption of semiconductor IPs from semiconductor industry to introduce technologically advanced products is one of the key factors driving the market growth. Moreover, advent of new technologies including 5G, Internet of Things (IoT), and Artificial Intelligence (AI) is fueling the demand for specialized semiconductor IPs.
The global semiconductor IP market is expected to grow significantly in the coming years owing to increasing demand for advanced semiconductor devices in various end-use industries including computer peripherals and autombiles. dditionally, several companies are implementing strategies such as partnerships and collaborations, mergers and acquisitions, and new product launches in order to expand their market presence in the semiconductor IP market, in turn boosting the market growth.
Semiconductor IP Market Coverage
|Report Attributes||Report Details|
|Market Size in 2030 (USD Billion)||9.41 Billion|
|CAGR (2023-2030)||8.30 %|
|By IP Type||Processor IP, Memory IP, Interface IP Analog IP, and Others|
|By Core Type||Soft Core and Hard Core|
|By Source Type||Licensing, Royalty, and Servicing|
|By Application||Consumer Electronics, Telecom, Automotive, Aerospace, Healthcare, Agriculture, and Others|
|By Geography||Asia-Pacific [China, Southeast Asia, India, Japan, Korea, Western Asia] |
Europe [Germany, UK, France, Italy, Russia, Spain, Netherlands, Turkey]
North America [United States, Canada, Mexico]
Middle East & Africa [GCC, North Africa, South Africa]
South America [Brazil, Argentina, Columbia, Chile, Peru]
|Key Players||Arm Limited, Synopsys, Cadence Design Systems, Rambus, Imagination Technologies, Ceva Inc., Mentor Graphics (A Siemens Business), eSilicon, Virage Logic (Acquired by Synopsys), Silicon Creations, Silicon Labs, NXP Semiconductors, Broadcom, Marvell Technology Group, TSMC IP, Verisilicon, Open-Silicon, Kilopass Technology, Silicon Storage Technology (SST)|
Semiconductor intellectual property (IP) provides a cost-efficient and effective solution for companies seeking to develop intricate chips without bearing the significant expenses associated with internal design and production. . Additionally, the rise of the Internet of Things (IoT) and connected devices is fueling the adoption of semiconductor IPs for producing low-power, high-performance chips. Moreover, the growth of semiconductor IP market is boosted by the increasing number of startups and small businesses entering the electronics market. The startup companies lack the resources to create custom chips and hence rely on semiconductor IP manufacturers to introduce the products to market quickly and cost-effectively.
Intellectual property (IP) theft is considered to be one of the factors restraining the adoption of semiconductor IPs in the electronics industry. The semiconductor industry relies heavily on the protection of IP rights to maintain a competitive advantage and ensure continued innovation. The theft of semiconductor IP can result in significant financial losses for companies and hinder their ability to develop new products. The theft of semiconductor IP can occur through a variety of means, including hacking, reverse engineering, and the unauthorized sharing of confidential information. This can lead to the creation of counterfeit products, which can damage the reputation of the original manufacturer and result in lost sales.
Development of open-source IP to design and build custom hardware without requiring licensing fees or proprietary technology is anticipated to provide lucrative growth opportunities. The open-source IPs play a vital role in promoting innovation and driving down the cost of developing new hardware. For Instance in April 2020, Arm Limited, a leading semiconductor IP provider, introduced an initiative named Flexible Access for Startups, which enables the silicon startups to access the companys IP portfolio at no cost.
Semiconductor IP Market Segmentation:
By IP Type
The IP type segment is classified into processor IP memory, IP interface IP, analog IP, and others. Processor IP holds the dominant share in the Semiconductor IP market due to the increasing demand for high-performance and energy-efficient processors in various applications including mobile devices, automotive systems, IoT devices, and consumer electronics. For instance, Arm Limited provides capable mainstream Cortex-M processor with Arm Helium technology that Simplifies AI implementation for IoT.
Moreover, surge in trend towars IoT, automation, and autonomous vehicle technologies, is expected to register the fastest- CAGR for memory IPs in the semiconductor IP market during the forecast period. Different types of memory IPs including SRAM, DRAM, and flash memory, are widely used in various applications including mobile devices, data storage devices, and automotive systems. The increasing demand for higher storage capacity and faster data access speeds from sectors including telecommunication, automotive and consumer electronics is driving the growth of the memory IP market.
By Core Type
The core type is bifurcated into hard IP core and soft IP core. The hard IP core segment accounted for largest share of the Semiconductor IP market in 2022. Hard IP cores are designed to be implemented in silicon devices and are usually used for high-performance and power-critical applications. The hard core IPsare often used for digital signal processing, memory controllers, and high-speed interfaces.
Furthermore, soft IP cores are estimated to show significant growth in the market during the forecast period, owing to increasing implementation of the IPsin FPGA (Field-Programmable Gate Array) or ASIC (Application-Specific Integrated Circuit) and low-performance and low-power applications. Also, the soft core IPs are widely used for control logic, interface and communication protocols, and software-defined functions.
By Source Type
The source type segment is divided into royalty, licensing, and servicing. The royalty segment holds the largest share in terms of revenue in the semiconductor IP market in 2022. Companies that specialize in IP licensing, such as ARM and Qualcomm, generate a significant portion of their revenue from royalties. Royalty models include high-performance processors, memory controllers, and high-speed interfaces. For instance, in 2021, the royalty revenues of the ARM company increased by 20% to account for approximately USD 1.54 billion.
Moreover, licensing segment is expected to register the fastest CAGR in the market. Licensing includes companies that design and manufacture their own chips, as well as those that integrate third-party chips into their products. For Instance, Intel licenses ARM\'s processor cores, and both Qualcomm and Texas Instruments use ARM cores in their mobile phone chips Licensing fees are based on the number of chips produced or the volume of products sold.
The application segment is categorized into consumer electronics, telecommunication, automotive, aerospace, healthcare, agriculture, and others. The consumer electronics segment holds the dominant share in the semiconductor IP market due to increasing demand for connected devices, smart homes, and the internet of things (IoT). The use of semiconductor IP in consumer electronics is critical for developing and producing integrated circuits that power the electronic devices.
Further, the telecommunication application is anticipated to show fastest growth in terms of CAGR during the forecast period. The growth of the telecom industry is driven by the increasing demand for high-speed connectivity, 5G networks, and the internet of things.
The North American region accounted for largest market share of the global market in 2022. The market in North America is driven by several factors including presence of a large number of semiconductor IP companies in the region. Additionally, the regions strong focus on research and development, as well as the presence of a large number of universities and research institutes, is also driving the market growth. For instance, the United States government offers tax incentives for businesses that conduct R&D and has impolemented grant programs that support research in different fields.
The Asia Pacific region segment is expected to grow at fastest rate during the forecast period. Growing population and increasing disposable incomes in the region has resulted in rise in adoption of electronic devices including smartphones, laptops, and other smart devices, leading to surge in demand for semiconductors. Additionally, the governments of several countries in the region have launched initiatives to develop semiconductor industries and reduce their reliance on imports, which in turn is expected to boost the demand for semiconductor IPs during the forecast period.
Semiconductor IP Market Competitive Landscape:
Stakeholders have the opportunity to evaluate parameters such as SWOT analysis, merger acquisitions, and business strategies. Thus, the nature of the global market is primarily competitive or high due to the presence of large numbers of market industry players. Following are the prominent market players that consist of the latest market concentration. –
• Arm Limited
• Cadence Design Systems
• Imagination Technologies
• Ceva Inc.
• Mentor Graphics (A Siemens Business)
• Virage Logic (Acquired by Synopsys)Silicon Creations
• Silicon Labs
• NXP Semiconductors
• Marvell Technology Group
• TSMC IP
• Kilopass Technology
• Silicon Storage Technology (SST)
• In May 2020, Arm Limited launched Cortex-A78 CPU IP, which is specifically designed to deliver high performance and energy efficiency for mobiles, laptops, and other smart devices.
• In April 2021, Cadence Design Systems released two new digital signal processing (DSP) intellectual property (IP) cores for embedded vision and artificial intelligence (AI) applications. The new cores are part of the companys Tensilica Vision DSP product family, which is a popular line of products that enables developers to create high-performance, energy-efficient vision and AI applications.