© 2010

Copyrights © Yole Développement SARL. All rights reserved.

Emerging applications of

MEMS devices:

From which product the growth

will come?

© 2010 • 2

Yole Développement

• Yole Développement is a market research and strategy consulting company, founded in 1998 and involved in the following fields:

• MEMS, including microfluidics

• Advanced packaging (3D IC, TSV, SoC, WLP…)

• Power electronics

• LED & HB LED

• Compound semiconductor business (SiC, GaN, AlN, ZnO, Thick SOI…) at substrate and device level

• Photovoltaic, from equipment and materials to cell business

• Our research is performed by in-house personnel conducting open-ended discussion based interviews.

• 20 full time analysts with technical and marketing degrees

• Primary research includes over 2,500 interviews annually

• Our customers’ base and perspectives are global.

© 2010 • 3

Our Global Activity

Yole Inc.

Yole Développement SA

Lyon (HQ).

Yole Paris

Yole K.K.

30% of our business is

in North America 30% of our business is

in Asia

40% of our business is

in EU Countries

© 2010 • 4

3 business models

• Custom analysis:• 85% of YOLE business

• Covered by NDA agreement

• From few days to several months of work, depending on subject

• Publication of reports:• 10% of YOLE business

• 25 to 30 reports published every year

• Covering Mems, power devices, advanced packaging, PV…

• Publication of newsletters on 3D, PV and MEMS:• 5% of YOLE business (advertising in our newsletters)

• Take benefit of our 45 000+ subscribers to be visible and diffuse

information on your company and products!

© 2010 • 5

Across the Value Chain

Yole consultants provide Market Analysis, Technology Evaluation and Business Plan Assessment for clients

along the entire value chain.

© 2010 • 6

Some of Our Customers

Financial investors

& industry advocates

R&D Organizations

Suppliers (equipment, wafers, materials)

Component manufacturers

Integrators, system manufacturers and end users

© 2010 • 7

Custom Analysis Services

• Market research and marketing analysis• Identification of new applications and markets

• Set-up of market segmentation

• Proposal of marketing and action plans

• Strategic analysis• Analysis of positioning to create value

• Development of action plans to improve company performance

• Support in implementation and fund raising

• Technology evaluation• Analysis of technical areas and definition of technology strategy

• Process cost analysis and cost comparison

• Development of product and technology roadmap

• Specific services for investors by Yole Finance• Evaluation and analysis of business plans

• Evaluation of production infrastructure

• Expertise and due diligence before M&A– Company, market and technology expertise

– Strategy, marketing and technical due diligence

© 2010 • 8

Yole’s MEMS Reports

MEMS company valueAnalysis and evaluation

Reports released in May 2010

Report & Database released in July 09

Acceleration, gyro and IMUTechnologies & Markets

Report released in September 09

MEMS

CoSim+Cost Analysis Tool for

MEMS manufacturing

Excel™ tool released

September 09

MEMS foundryMarket and industry trends

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Status of the

MEMS industry

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$27

7% $23

6%

$109

26%

$82%$37

9%$92%

$317%

$168

41%

TSV Scenario Cost structure breakdown

Via / Etching Drilling

Via Isolation

Via filling

Temporary bonding

Thinning

Stress release

BEOL (Pads)

Bonding

Emerging Mems

applications

© 2010 • 9

EVOLUTION OF THE MEMS

MARKETS

© 2010 • 10

Key facts to remember…

• MEMS remains a fragmented market:• A limited number of applications have a market size above $200M

• Simplification of manufacturing is still an objective• The MEMS law “One product, one process, one package” is still

there

• MEMS packaging is more and more an “added value step” with 3D

MEMS being more widely adopted

• Software development is now an important competence in MEMS

companies in order to sell functions and not devices

• The development of new MEMS applications is taking

years to be commercialized• On average, 4 years from first developments to first commercial

product and $45M of investment … and 3 to 4 different CEOs…

© 2010 • 11

Key facts to remember…

• Several major system companies with MEMS fabs are

now looking to use external foundries• At least 5 major companies are involved in such changes, with a

total cumulative business of $350M…

• Delphi and Conti have already taken this decision

• 8’’ manufacturing infrastructure is needed for companies targeting consumer electronics

• The MEMS manufacturers not involved in consumer electronics are facing a very strong risk to lose competitiveness

• Fabless companies are under the financial umbrella of their main customers… or are sold or dead because financial investors are NOT taking the risk to re-invest

• Siimpel has now LG Innotek as investor, same for Wispry with Samsung and Murata…

© 2010 • 12

Significant Changes in the

2009 MEMS Ranking

0

100

200

300

400

500

600

700

800

TOP 30 MEMS Company ranking 2009 - 2008

2008

2009

© 2010 • 13

Annual Growth Rate 2009 / 2008

497%

67%

19%

14%

10%7%

3%0% 0% 0% 0%

0% -1% -2%-4%

-7%-10% -10% -10%

-13% -14% -15%-18% -19% -20% -21%

-29% -30% -30%-33%

Annual growth rate 2009/2008 (on USD basis)

© 2010 • 14

Innovation in Mems has changed

• One of the key element to understand the evolution of the Mems

markets is to understand the source of the innovation

• New functions are proposed by MEMS devices at the moment:

• The functions which are under commercialisation now have been

developped since a very long time: energy harvesting, oscillator, speakers,

micro-motors, autofocus, micro fuel cells… are under development since

more than 10 years and will step by step be introduce on the market.

• Innovation is coming from the usage of the existing devices… and

new ways to package and integrate the devices in a system

• All the important successes in the MEMS industry since 5 years are

linked to these 2 innovations paths: usage and packaging

• The success of ST with accelerometers is linked to usage of well known

accelerometer

• The success of Invensense is linked to packaging innovation

• The success of the silicon microphone is linked to the packaging innovation

• The success of pico projector is link both to a new usage and new

packaging

© 2010 • 15

Last M&A and VC round

Company Round Type Acquired Company Amount raised (US$)

Sensata Technologies IPO - 600M

Discera Series D - 11M

MEMSIC Acquisition Crossbow’s inertial business lines

18M

Integrated Device Technology (IDT)

Acquisition Mobius Microsystems Not disclosed

Mezmeriz Equity Financing - 2M

Tessera Acquisition Siimpel 15M

Thermo Scientific Acquisition C2V Non disclosed

Becton Dickinson Acquisition HandyLab 250M

Rohm Acquisition Kionix 230M

Bosch Acquisition Akustica Non disclosed

Walsin Liwha Acquisition Miradia Non disclosed

© 2010 • 16

MEMS FOUNDRY MARKET

© 2010 • 17

Ranking of the MEMS Foundries

TOP20 MEMS Foundries

Ranking on 2009 compared to 2008 data

© 2010 • 18

Mems foundry sales growth/decrease

in 2009 compared to 2008

© 2010 • 19

MEMS MARKET UPDATE

© 2010 • 20

MEMS $M 2009-2015 forecast

2009 2010 2011 2012 2013 2014 2015

Others (microstructures, micro tips, flow meter …) $129,0 $150,4 $204,9 $270,0 $342,7 $462,4 $596,9

Micro speakers $0,0 $0,0 $0,0 $10,0 $37,5 $90,0 $150,0

Oscillators $7,9 $17,0 $33,6 $64,7 $119,9 $213,0 $347,6

RF MEMS $228,9 $246,5 $286,5 $339,4 $402,1 $506,3 $602,5

Microdispensers (microfluidics) $140,1 $174,3 $214,7 $261,3 $313,5 $376,1 $451,3

Microfluidics for IVD $633,3 $757,5 $952,4 $1 196,8 $1 494,9 $1 875,5 $2 363,5

Microfluidics for Research $199,3 $269,0 $363,1 $490,2 $637,3 $828,5 $1 077,1

Other optical MEMS $77,4 $91,4 $107,8 $128,7 $154,9 $189,3 $225,9

Projection systems $663,7 $707,4 $839,8 $1 068,6 $1 415,4 $1 814,2 $2 115,1

Micro displays $0,5 $2,5 $9,6 $23,0 $45,0 $66,0 $86,0

Microbolometers $204,5 $219,3 $233,5 $250,6 $277,6 $313,8 $375,0

Digital Compass $111,5 $194,6 $248,5 $269,0 $281,7 $286,9 $285,0

Gyroscopes $839,6 $1 012,1 $1 127,5 $1 235,7 $1 381,6 $1 442,4 $1 533,9

Accelerometers $1 036,2 $1 117,0 $1 237,1 $1 341,2 $1 402,2 $1 429,1 $1 470,3

Microphones $123,3 $170,5 $222,2 $292,4 $323,6 $370,5 $410,7

Pressure Sensors $1 056,0 $1 200,6 $1 404,3 $1 694,9 $1 941,8 $2 154,7 $2 324,4

InkJet Heads $1 547,7 $1 566,1 $1 625,7 $1 740,4 $1 831,5 $1 937,9 $2 043,7

$0,0

$2 000,0

$4 000,0

$6 000,0

$8 000,0

$10 000,0

$12 000,0

$14 000,0

$16 000,0

$18 000,0

US

$M

MEMS Forecast in $MJune 2010

© 2010 • 21

MEMS units 2009-2015 forecast

2009 2010 2011 2012 2013 2014 2015

Others (microstructures, micro tips, flow meter …) 1 2 5 9 16 35 56

Micro speakers 0 0 0 5 25 75 150

Oscillators 17 36 72 138 248 421 674

RF MEMS 559 658 805 987 1 190 1 551 2 023

Microdispensers (microfluidics) 25 43 55 68 118 141 168

Microfluidics for IVD 177 246 312 394 493 621 785

Microfluidics for Research 0 1 1 1 2 2 3

Other optical MEMS 1,3 1,7 2,2 3,7 6,6 12,8 18,3

Projection systems 1 3 9 21 44 79 136

Micro displays 0,1 0,5 2,0 5,0 10,0 15,0 20,0

Microbolometers 0,2 0,3 0,3 0,4 0,4 0,6 0,7

Digital Compass 103 219 340 441 542 652 770

Gyroscopes 201 268 325 402 510 587 722

Accelerometers 906 1 090 1 362 1 630 1 838 2 002 2 194

Microphones 318 449 579 816 995 1 186 1 381

Pressure Sensors 296 337 389 488 571 633 689

InkJet Heads 668 664 673 683 691 706 719

0

2 000

4 000

6 000

8 000

10 000

12 000

Mu

nit

s

MEMS Forecast in MunitsJune 2010

© 2010 • 22

EMERGING MEMS

APPLICATIONS

© 2010 • 23

Emerging MEMS

NEW

APPLICATI

ONS

SUBSTITUTION FOR

OTHER

TECHNOLOGIESCAGR >

50%Auto-focus

Digital compass

Energy

harvesting

Micro bolometers

Microdisplays

µFuel cells

µspeakersMicro structures

MicrotipsOscillators

MEMS RFID Where Emerging MEMS are.

© 2010 • 24

Emerging MEMS

• Auto focus:

– System relying on one or more sensors to determine correct focus. MEMS used provides high precision control of a

moving lens barrel to provide auto focus functionality.

• Energy harvesting (or “energy scavenging”):

– Process by which energy of the environment is captured and stored

• Magnetometer (« electronic compass »):

– Scientific instrument used to measure the strength and/or direction of the magnetic field in the vicinity of the instrument

• MEMS RFIDs:

– Wireless communication system that stores data about items allows information to be extracted using radio waves.

• MEMS speakers:

– Electroacoustic transducer that converts an electrical signal into sound.

• Microbolometers:

– Microbolometer is an uncooled - low cost - thermal sensor. A microbolometer consists of an array of pixels, each pixel

being made up of several layers.

• Micro displays:

– Display screens for portable applications (cellphones).

• Micro fuel cells:

– A micro fuel cell is a portable power source for low power electronic devices that converts chemical energy into useable

electrical energy

• Microstructures:

– Micro components (gears, spring, anchor) used in mechanical watches and made with MEMS micromachining technologies

(DRIE, UV-LIGA).

• Micro tips:

– The end of a pointed object attached to a surface or a cantilever.

• Oscillators:

– Electronic circuit that uses the mechanical resonance of a vibrating crystal of piezoelectric material to create an electrical

signal with a very precise frequency

© 2010 • 25

MEMS products are in the development phase

having successfully crossed the “Chasm”Emerging MEMS definition

Microdisplay

Autofocus/µZoom

MEMS OscillatorsµFuel cells

µstructures

Energy

harvesting

Emerging Development Mature Decline

Electronic Compass

Microtips

MEMS ID

MEMS Speakers

Micro bolometers

Microphones

Accelerometers

Gyroscopes

Inkjet Head

Pressure sensors

Filters

© 2010 • 26

Many new startups

New companies developing emerging MEMS devices

© 2010 • 27

Emerging MEMS 2009-2015 Forecast$M value

2009 2010 2011 2012 2013 2014 2015

RFIDs $0,0 $0,5 $1,4 $2,8 $5,1 $8,4 $14,4

Oscillators $7,9 $17,0 $33,6 $64,7 $119,9 $213,0 $347,6

Micro tips for microscopy $42,0 $43,8 $46,9 $53,9 $59,8 $67,0 $76,3

Micro tips for ATE $58,5 $67,2 $93,5 $110,8 $136,7 $167,2 $197,6

Micro structures $0,3 $0,6 $1,2 $1,8 $2,1 $2,7 $3,0

Micro speakers $0,0 $0,0 $0,0 $10,0 $37,5 $90,0 $150,0

Micro fuel cells $0,0 $0,9 $6,0 $15,0 $30,0 $75,0 $120,0

Micro displays $0,5 $2,5 $9,6 $23,0 $48,4 $66,0 $86,0

Microbolometers Cores $322,6 $392,8 $461,9 $538,4 $629,8 $707,4 $788,0

MEMS-based energy harvesting $0,0 $0,0 $0,0 $0,0 $0,0 $0,0 $0,0

Digital Compass $125,0 $218,2 $282,0 $312,7 $347,4 $361,1 $374,2

Auto-Focus $2,1 $2,6 $3,3 $5,7 $10,2 $19,1 $25,9

$0,0$400,0$800,0

$1 200,0$1 600,0$2 000,0$2 400,0

$M

Emerging MEMS Markets$M - February 2010

© 2010 • 28

Emerging MEMS Market Shares 2009

0,4%

22,4%

57,7%

0,1%

0,1%10,5%

7,5%1,4%

Emerging MEMS market share (in value, total $559M) 2009

Auto-Focus

Digital Compass

Microbolometers Cores

Micro displays

Micro structures

Micro tips for ATE

Micro tips for microscopy

Oscillators

© 2010 • 29

Emerging MEMS Market Shares 2015

1,2%

17,1%

36,1%

3,9%

5,5%

6,9%0,1%

9,0%

3,5%

15,9%

0,7%

Emerging MEMS market share (in value, total $2,2B) 2015

Auto-Focus

Digital Compass

Microbolometers Cores

Micro displays

Micro fuel cells

Micro speakers

Micro structures

Micro tips for ATE

Micro tips for microscopy

Oscillators

RFIDs

© 2010 • 30

Mems growth will be very strong for

these new devices…• We have analyzed markets and technologies for MEMS devices that are

promised to represent a significant market value in 2015. These MEMS have

or will soon crossed the gap between R&D and commercialization.

• Most of the new MEMS developments are under the roof of startups.

– The situation is quite similar to what has happened in the 1998-1999 years, when

many new MEMS developments were on the edge of crossing the chasm and are

today mature MEMS products with large volume market: gyroscopes,

microfluidics.

– We have identified more than 30 startups involved in these developments.

• Among the emerging MEMS analyzed, microbolometers, digital compasses

and oscillators will represent the most promising market.

© 2010 • 31

For more information …

Take a look at our websites

www.i-micronews.fr

Please make a stop at Yole booth: N° 1318

Feel free to give me your business card to receive the electronic copy of my slides.