Consolidation still rampant in semicon metrology/inspection equipment market

NEW TRIPOLI, USA: The semiconductor setrology/inspection equipment market finally outperformed the rest of the overall semiconductor front-end wafer processing equipment market for the first time in three years, according to the report “Metrology, Inspection, and Process Control in VLSI Manufacturing”, recently published by The Information Network.

“Consolidation in the semiconductor metrology/inspection equipment market is greater than any other sector,” noted Dr. Robert Castellano, president of The Information Network. “Several factors are responsible, but the financial strain of numerous small companies competing against several large ones, exasperated by the downward spiraling macroeconomic landscape, and coupled with an undercurrent of less 300mm equipment needed by the semiconductor manufacturers, has taken its toll.”

The past few years have witnessed the acquisition of the MIE business unit of Vistec Semiconductor Systems, ICOS Vision Systems, Therma-Wave. ADE, August Technology, Accent Optical Technologies, Soluris, Laserfront Technologies, Tevet, Advanced Metrology Systems, and QC Solutions. In addition, Israel-based Negevtech ceased operations.

As the industry moved into the 65nm and 45nm technology nodes, more money was spent on metrology/inspection tools as a ratio of overall equipment buys in 2008. In 2008, metrology/inspection revenues dropped 21.8 percent, while the overall semiconductor front-end wafer processing equipment market dropped 32.8 percent.

However, for both 2006 and 2007, the metrology/inspection market underperformed the overall semiconductor front-end wafer processing equipment market. In 2006, metrology/inspection revenues grew 13.2% compared to 28% for the total front-end equipment sector.

In 2007, metrology/inspection revenues grew 7.2 percent compared to 11 percent for the total front-end equipment sector. Historically, sales of process control tools have mirrored sales of the entire front-end equipment market, with the average spread only 2.4 percent for the previous 12 years.

“For 2009, we project the metrology/inspection market to experience a drop in revenues of 33%, in tandem with the total front-end market, which will drop 41 percent,” added Dr. Castellano.