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<3 inch InP compound semiconductor epiwafer developed by Korea Advanced Nano Fab Center>

The market for a compound semiconductor required for high-speed optical communication and three-dimensional (3D) sensing, Indium Phosphide (InP), is expected to more than double in next five years. It is analyzed that the telecommunication industry will lead the continuous growth of InP, and the demand for 3D sensing such as LiDAR will also increase.

According to Yole Development, a market research firm, the InP semiconductor market is expected to grow at a CAGR of 14% from 2.5 billion USD last year to 5.6 billion USD by 2027. InP is mainly used for laser diodes, which are core components of communication equipment such as high-speed, long-distance optical transceiver.

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Data communication is expected to form the largest market. InP for data communication is expected to grow from 1.24 billion USD last year to 3.4 billion USD in five years. It has the largest share in the InP semiconductor market. InP for mobile communication is expected to follow with 1.8 billion USD by 2027.

Yole Development predicted by saying, “The market will grow centered on large cloud service providers and national telecom operators that need to expand the capacity of optical communication networks.” The spread of 5G mobile communication is also analyzed to lead the growth of the InP semiconductor market.

The growth of InP semiconductors in the 3D sensing field is also steep. The sector with the highest growth rate is the automotive LiDAR market. InP is used to create edge-emitting laser (EEL) in the LiDAR market. The automotive LiDAR InP market was too small that their numbers were not included in the market statistics until last year, but it is expected to grow at a CAGR of 189% and expand to 14 million USD in five years.

Rapid growth is expected in the sensor market for consumer products such as wearable devices and smartphones. Yole Development announced that InP was first applied to Apple AirPod’s short-wave infrared (SWIR) sensor last year.

The sensor is responsible for distinguishing the skin from other contact surfaces. It is known that the InP based sensor is also applied to the Apple iPhone 14 Pro. Yole Development said, “Smartphone manufacturers have a keen interest in applying 3D sensors under organic light emitting diode (OLED) displays. InP is being considered as an alternative to the existing gallium arsenide based vertical-cavity surface-emitting laser (VCSEL).” They continued, “Considering the greater potential in the consumer sensor market, new manufacturers will enter the InP market.”

By Staff Reporter Dong-jun Kwon (djkwon@etnews.com)