Varactor Diodes – Critical in Wireless Technology

The exponential growth in the electronics industry has created significant opportunities for a host of component manufacturers. Varactor diode manufacturers have also seen demand increasing steadily in the recent past; however, reliance on quantity alone may not suffice in the long run. As devices becoming smarter and high-tech, varactor diode manufacturers are staring at a future where legacy components may become obsolete. To sustain and succeed, development of new products, through rigorous research and development, will be the key. Transparency Market Research (TMR) in its latest study, analyzes these global varactor diode market comprehensively, offering readers rare insights and analysis on how demand will evolve in the future.

varactor diode market key recommendations

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Increasing Applicability of Varactor Diodes

The proliferation of smart devices has necessitated the need for smarter components used in the manufacturing of these devices. Component manufacturers are being hard-pressed to develop and enhance the working of varactor diodes, as they play a significant role in providing the desired capacitance changes. Device manufacturers are looking for diodes that are reliable, incur lesser cost, and generate low noise—varactor diodes more or less satisfy these requirements. Driven by their growing applicability, the varactor diode market is likely to cross US$ 800 million by the end of 2027.

The adoption of varactor diodes has substantially increased in the aerospace and defense industry too. Varactor diode manufacturers are aware of the growing opportunities, and it is highly likely that demand from aerospace and defense will translate into a larger revenue share than it does currently.

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Reverse Bias Mode Continues to Impede Pervasive Adoption

Varactor diodes mainly work on the reverse bias mode. As such, their application is limited in a few industries. On the other hand, ordinary diodes work on the forward bias mode, allowing them to have a wide range of industrial applications. Owing to this fact, varactor diode manufacturers have limited scope in which to experiment, which also limits their scope of innovation. This, in turn, is obstructing the growth of the global varactor diode market.

Adoption of 5G Technology to Influence the Smarter Adoption of Varactor Diodes

The semiconductor industry is keenly observing the broader developments in wireless and 5G technology. The massive investments in these technologies has already created significant opportunities for semiconductor industry in general, and varactor diode manufacturers in particular. In a bid to capitalize on these opportunities, strategic partnerships, mergers, and acquisitions are in the offing.

Recently, Movandi and NXP Semiconductors N.V. entered into a strategic partnership to collectively work on millimeter wave solutions for 5G networks. With this initiative, they will collectively deliver high-performance 5G solutions and wireless communication infrastructure for applications such as smart homes, self-driving cars, and mobile cloud-based services.

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Skyworks Solutions, Inc., another prominent player in the global varactor diode market, entered into a collaboration with MediaTalk Incorporated to deliver a standard-based 5G solution.

China and India at the Forefront of Demand

Growing demand for smartphones in China and India continue to drive demand for varactor diodes. Based on recent studies, the number of mobile phone users in Asia Pacific is projected to cross 2.8 billion by the end of 2019. Increasing Internet penetration and disposable income have meant that demand for smartphones is not going to subside anytime soon—a critical factor that can ensure sustained demand for varactor diodes in the region.

Duality in the Varactor Diode Market Structure

In the global varactor diode market, the competition seems moderately consolidated, as leading players in this market hold more than 50% share. However, in the coming years, the market may experience a fragmented nature due to the emergence of prominent and new players.

Key players in the market are focusing on organic and inorganic strategies that create a dynamic competitive landscape in the global varactor diode market. Innovation and geographic expansion are also some of the key focus points of players in the market. For example, Skyworks Solution Inc. acquired Avnera Corporation to expand its leadership in wireless connectivity solutions. With this acquisition, Skyworks intends to capitalize on the rapid proliferation of audio functionality and its convergence with advanced connectivity solutions.

Another example is of Infineon Technologies AG, which recently expanded its development site in Liz, Austria. With this expansion, the company will offer room for around 400 employees. Further, it will strengthen its research and development efforts in the area of high-frequency components. The company’s R&D mainly focuses on 77GHzradar chips for driver assistance systems.

Global Varactor Diode Market: Overview

A varactor diode is a semiconductor device that operates in a reverse-bias mode. A diode whose internal capacitance varies according to variations in the reverse voltage is known as a varactor diode. In a voltage-dependent device, the output of the diode depends upon the input voltage. A Varactor diode is also called a varicap diode, voltage-variable capacitance, or tuning diode. Varactor diodes are largely used in applications wherein variable capacitance is required. The global varactor diode market is anticipated to expand at a CAGR of more than 6.5% between 2019 and 2027, and reach value of more than US$ 800 Mn by the year 2027.

Varactor diodes are largely used in the filters and tuning circuits of various electronic devices such as mobile phones, TV sets, FM radios, and satellite communication equipment. These diodes are also extensively utilized in wireless system infrastructure. They play a key role in the operation of 5G technology. Varactor didoes enhance the linearity function for the high-speed applications of 5G technology. With the implementation of 5G technology and the growing use of varactor diodes in tuning circuits, the varactor diode market is estimated to expand at a significant pace during the forecast period.

The demand for varactor didoes for use in consumer electronics products such as mobile phones, TV sets, FM radios, and satellite communication equipment; and in their circuits, such as voltage-controlled oscillators, RF filters, and automatic frequency controls; is rising. This factor is expected to provide lucrative opportunities to the global varactor diode market during the forecast period. Since semiconductors form an integral part of electronic and computing products, the boom in the consumer electronics industry and the high consumption rate of mobile phones and TV sets are also driving the global varactor diode market.

Varactor diodes offer several advantages over other types of diodes. A varactor diode operates in the reverse-bias mode. In this mode, a varactor diode operates at up to 20 volts. Some diodes can operate at up to 60 volts too. Some of the key characteristics of varactor diodes are reliability (varactor diodes are more reliable than other p–n junction diodes), low noise (varactor diodes generate less noise than other diodes), low power consumption, portability (varactor diodes are small in size and easy to carry), and low price.

The global varactor diode market has been segmented based on product, end-use industry, and region. In terms of product, the varactor diode market has been classified into mobile phones, TV sets, FM radios, satellite communication, and others. The mobile phone segment dominated the market in 2018, due to the increasing consumption of mobile phones with varactor didoes being used in their circuits.

In terms of end-use industry, the global varactor diode market has been divided into consumer electronics, automotive, aerospace & defense, and others. The consumer electronics segment is expected to dominate the market during the forecast period, due to the increasing adoption of consumer electronic devices such as mobile phones, TV sets, and FM radios.

In terms of region, the global varactor diode market has been segmented into North America, Europe, Asia Pacific, South America, and the Middle East & Africa. Asia Pacific accounted for a major share of the global market in the year 2018. The varactor diode market in the region is driven by the strong presence of key players and high rate of adoption of consumer electronic devices in the region.

Attracted by the anticipated growth of the global varactor diode market and underlying latent demand, several players are expanding their businesses through strategic mergers and acquisitions, as well as partnerships. Some of the prominent players operating in the global varactor diode market are NXP Semiconductor, Skyworks Solution Inc., Infineon Technologies AG, Microsemi Corporation, MACOM Technology Solutions Holdings, Inc., Toshiba Corporation, On Semiconductor, ST Microelectronics, ASI Semiconductor Inc., and Murata Manufacturing Co., Ltd. 

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