RF Power
Amplifier Market Analysis
Competitive Landscape for Quad Band GSM Power Amps - February 6, 2005
We interviewed engineers at several reputable power amplifier
(amp) companies and present here a brief summary of what we learned.
The market for cellular handset power amps is both the largest
and most competitive segment of the power amp business. In turn,
the Global System for Mobile Communications (GSM) is the largest
segment of the cellular handset market. Almost all new GSM handsets
are now capable of using four different frequency bands (850, 900,
1800 and 1900 MHz, representing the GSM bands in use in Europe,
parts of Asia, and most of the Americas). In our discussion we
will therefore only consider four-band (or “quad-band”)
GSM power amps.
The market for GSM cellular power amps is even more fiercely competitive than
the wireless LAN power amp business.
Prices and margins are constantly eroding. Complete modules with integrated passives
sell for well under $0.70. Unlike the wireless LAN power amp case, however, the
efficiency of the cell phone power amp does matter in battery life. GSM handsets
transmit almost as much data as they receive. For example, if we consider average
cell phone users, they talk as much as they listen. Furthermore, battery life
on cell phones is a feature that interests consumers and on which cell phone
manufacturers can differentiate.
Therefore, cell phone power amp manufacturers have already invested a great deal
to increase the efficiency of their products. Existing GSM power amps that are
shipping in volume today, have typical efficiencies of about 55%, and can reach
as high as 63%.
Similarly to wireless LAN power amp modules, the packaging costs of a cell phone
power amp module is comparable to the die cost, while the “packaging-plus-test” costs
exceed the die cost. This means that the overall cell phone power amp manufacturing
costs also cannot be reduced by simply reducing the die size (and hence cost).
Moreover, the industry already uses very tiny die sizes for wireless power amplifier
products, mostly in the range of 1 mm2 to 1.5 mm2. Huge numbers of die per wafer
are already being produced, so there is minor advantage to be found through further
miniaturization.
It takes about 1.5 to 2 years for an established cell phone power amp company
that has an existing and productive working relationship with a cell phone handset
maker to transition a new idea from the first laboratory demonstration to a design
that can be manufactured in high volume. Handset makers are very conservative
and prefer using approved and well-tested designs. For a handset maker, a recall
of millions of cell phones caused by a minor defect in the power amp (a 70 cent
component) is a disaster scenario to be avoided at all costs.
The prevalent attitudes are:
- If it’s not broken, why fix it? or,
- If it doesn’t affect our costs, then why take any risks?
The conservatism in the cell phone industry makes it difficult
for power amp startups to get in the door to have their new designs
tested and evaluated. The dire consequences of component failure
make it even more difficult for power amp startups to qualify their
products with key, high volume customers. Typically, starts take
much longer to achieve high volume sales, owing to their lack of
credibility and young track records.
In addition, the economics of volume manufacturing heavily favor
the established players. Power amp startups and new players pay large
premiums for wafers, packaging, and testing. Initially, they also
buy in smaller volumes, which can further exacerbate the cost problem.
Unless a new entrant to the market has at least a 2X inherent cost
advantage to offset the inevitable manufacturing disadvantages, he/she
doesn’t
have a fighting chance.
Note that this commentary comes directly from discussions with people from well-established
power amp companies, and from someone who has started a power amp company – interestingly
enough all parties said the same thing. The links below lead to companies that
are active in the wireless power amplifier market. We present examples of part
numbers, typical performance (specifically efficiency), and data sheets. Note
that nearly all of the products here have been available for a year or more.
No future products are included in this list.
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