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According to Dataquest (Gartner Group) the semiconductor industry in 1999 enjoyed double-digit growth, averaging 17.6%, for the first time since 1995. Intel led sales volume for another year with $25.8 billion, while the rankings from 2 through 10 sold $9.2 billion down to $5.0 billion. The only real surprise in the top 10 was Samsung's leapfrog over TI into 4^th place with a year's growth of 49.5%. Motorola dropped in ranking from 3^rd to 6^th position because of the spin-off of the Semiconductor Products Group as ON Semiconductor.

But while the sales top 10 reads downwards as Intel, NEC, Toshiba, Samsung, TI, Motorola, Hitachi, STMicroelectronics, Philips and Infineon, growth is entirely another matter. While average growth was 17.6% at least two additional companies would appear in a list of companies performing above that average:

Company	Growth
Samsung Micrel Toshiba Infineon Linear Technology STMicroelectronics	49.5% 41.0% 28.4% 28.2% 28.0% 21.0%

The growth of Samsung and Toshiba can largely be attributed to an extremely strong memory market that has stabilized despite the immediate panics after the major earthquake in Taiwan. Toshiba has also benefited from its ASIC and remarkable C-band designs, and has not been harmed by its display and laser diode progress.

Micrel's position is somewhat different; you could describe it as growth by opportunity but in reality it is growth in the analog world by clever positioning, aquisitions and outstanding employees. The only area the company has not really attacked is RF (not excluding its clever single chip low-power systems) but the technologies are in position.

Infineon outruns itself; by all accounts the company has little need in attracting additional customers as it sells all the RF and power products that it can make limited only, it seems, by capacity; STMicroelectronics adds memory to a similar mix and pushes its markets hard while being a beacon for green engineering -- a good example of corporate responsibilty not affecting corporate growth.

Linear Technology, of course, pursues high margins with high numbers of product releases; in this case profits and growth are both extremely high.

How will these growth numbers play for the year 2000? Some of these companies are dependent on the PC industry and growth will presumably parallel that market's growth. Others are Internet relevant and that is assuredly a major growth arena. In the arena of portable products there is apparently no stopping the existing major growth pattern. Any company involved in RF parts for such products, or in power items for portable, should logically have the problems involved in controlling the growth rather than creating it.

We also see signs that fab capacity is going to enter a limiting stage in the next 18 months. Will the contract agreements made by the fabless "manufacturers" be abided to by the fabs? Will those companies that have been invested in by some of the major manufacturers lose their independence? Or do we have it all wrong?

Additionally, is too high a growth rate a good thing for a company? Perhaps controlled growth that tracks an industry average is a better indication of stability? What do you think?

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