Advanced Packaging Market Expands

Shrinking device features force package designers to accommodate more I/O connections in a smaller space. Smaller, portable end-user applications reduce the amount of circuit board real estate available (click here to read a related article). According to a report recently released by Frost & Sullivan (Mountain View, CA), the US market for advanced packages able to meet these requirements, like ball grid arrays (BGAs) and chip scale packaging (CSPs), should grow at a 13.8% compound annual rate through 2004. From $7.87 billion in 1997, the market is expected to reach $19.42 billion in 2004. Unit shipments of these packages, approximately 800,000 in 1997, will reach 5.5 million units by 2004, Frost & Sullivan predicts.

Ball grid arrays have been the first advanced packaging approach to gain significant market acceptance, with 81.6% of the advanced packaging market in 1997. BGAs can handle higher pin counts than lead frames, but require printed circuit boards able to handle high density routing. Limited availability of these boards and of BGA substrates has slowed growth of this technology. While Frost & Sullivan expects the BGA market to reach $12.77 billion by 2004, this will represent only 65.8% of the total market.

The report expects flip chip and CSP packages to capture the market share lost by BGAs. These technologies allow much higher I/O density, coupled with smaller physical size of the finished package. From $760 million in 1997, this segment should grow to $5.52 billion by the end of 2004, taking over 28.4% of the advanced packaging market.

The three primary sub-sectors of the flip chip/CSP market have slightly different drivers and constraints. Flip-chip-on-board (FCOB) technology has met wide acceptance in the digital watch market, and eliminates the need for a substrate altogether. Still, FCOB has been slow to receive wider acceptance, in part because rework of mis-soldered components is difficult or impossible. Flip-chip-in-package (FCIP) benefits from the growing use of multi-chip packages, for instance to place a microprocessor and its accompanying cache chips in one unit. So far, however, FCIP lacks an assembly infrastructure and processing costs remain high, the report said. Finally, the small size of CSPs opens up a practically unlimited market, once adequate production capacity is built.

Multi-chip modules (MCMs) represent the smallest and slowest growing segment of the advanced packaging market. This segment accounted for 8.7% of the total in 1997, and market share should continue to decline to 5.8% in 2004. In dollar terms, the report predicts that MCM revenues will grow from $684 million in 1997 to $1.13 billion in 2004. MCMs allow integration of several process technologies (BiCMOS, CMOS, and even non-silicon technologies, for example) in a single module. However, testing the individual chips in the module before assembly is difficult, and rework to remove a defective chip after assembly is expensive. Moreover, system-on-a-chip integration offers a more cost-effective way to realize many of the advantages of MCMs.

Any package design incurs costs on a per-die, not a per-wafer basis. Thus, packaging costs make up a larger and larger share of the total chip cost as shrinks reduce the per-chip cost in the front end (click here to read a related article). The resulting pressure to reduce packaging costs affects all of the technologies discussed here, and will ultimately determine which will succeed.

For more information: Frost & Sullivan, 2525 Charleston Road Mountain View, CA 4043. Tel: 415-961-9000, fax: 415-961-5042.

By Katherine Derbyshire