The report by Future Market Insights said that the market, valued at $27.7 million in 2016, is forecast to register a compound annual growth rate (CAGR) of 4.7 percent from 2017 to 2027.
The report cited growing demand in consumer electronics as one of the major factors driving growth. According to the report, the semiconductor industry is highly volatile in nature.
Many of the major producers of semiconductors are so-called fabless companies. The term fabless refers to a company that designs and sells the hardware and semiconductor chips but does not manufacture the silicon wafers, or chips, used in its products. These chips are instead produced by foundries, many located in Taiwan and China.
As a consequence most of the semiconductor assembly, testing and packaging-related services are outsourced by fabless companies to third-party providers known as ‘Outsourced Semiconductor Assembly and Test Service Providers’.
SATS are offered in various end user industries including communication, computing and networking, consumer electronics, industrial and automotive. According to the report the revenue contribution from the consumer electronics segment is anticipated to expand at a CAGR of 6.3 percent during the forecast period.
Among the regions, Taiwan is projected to exhibit relatively high growth in the global market, registering a CAGR of 5.6 percent over the forecast period.
Revenue from the SATS market in North America and the Asia-Pacific region (excluding Taiwan) collectively accounted for over 40 percent of the SATS Market revenue in 2017. SATS providers, meanwhile, are focusing on expanding their footprints across several countries in the Asia-Pacific region and Europe such as India and UK.
The report comes as the consumer electronics industry grapples with the impact of a global shortage in semiconductors. The shortage, which has impacted the availability of many consumer electronics products, is likely to continue throughout this year.
According to a US Commerce Department report published recently the global shortage will last until at least the second half of 2022.