NEVADA CITY, CA – IC packaging revenue is expected to grow 9.8% compounded annually, versus a CAGR of 7.3% for unit shipments through 2016, says New Venture Research.

Handheld electronic gadgets such as smartphones and tablets are driving the demand for ICs in the consumer electronics industry, as is the return in demand for automobiles, the firm says.

Increased demand for product functionality is driving up the IC packaging revenue faster than IC unit growth. The growth in handheld gadgets, which are increasingly digital in design, will boost the growth of special purpose logic communications chips by a 16.7% CAGR for device revenue through 2016, versus a 13.5% CAGR in units. FBGA and QFN package solutions are the most in demand, which pull at either end of the pricing structure. QFPs are ranked third as a package solution, but are decreasing in demand over time. These devices are expected to have a 14.8% CAGR in revenue through 2016.

Wireless infrastructure products are also in high demand, which is helping boost consumption for standard cell and PLD chips, says NVR. These devices will grow at a CAGR of 16.1% in terms of revenue through 2016, while the device units are projected at 15%. High I/O BGAs are the package solution of choice over the forecast period, the firm notes, so the package revenue growth is projected to be slightly higher, at a CAGR of 16.3% through 2016.

Logic chips are in demand for a host of products; therefore, 32-bit MCUs are expected to have an 11.1% CAGR unit demand, although only a device revenue CAGR of 4.7% through 2016. QFPs and BGAs have the highest demand of the package solutions, although the QFP is waning in favor of the BGA. Thus, the package revenue is growing at a CAGR of 12.8% through 2016 for 32-bit MCUs, according to NVR.