Close to 80% of base station silicon will be SoC based by 2017

ABI Research expects sales of base station processors to grow at 17 percent annually and reach $1.1 billion in 2017 driven by the growth in compact format femto-, pico-, and microcell small cell basestations, which will account for the majority of the processor market in 2017. With macrocells declining at 13 percent per year over the next 5 years, and microcells growing at a modest 7 percent the large growth in picocells and outdoor femtocells will consume the majority of next generation base station processors. As the number of these compact femtocells and picocells grows, the penetration of system-on-chip basebands will grow at 108 percent annually to reach almost 80 percent of the total market in 2017.

With a capacity shortfall looming, service providers are deploying Heterogeneous Networks (HetNets) with small cell underlays in dense urban areas and using distributed Radio Access Networks (RANs) to narrow the gap between capacity and demand, and all of these techniques are driving integration into the next generation base station baseband.

“These next generation baseband processors are heterogeneous multicore SoC devices including both DSP and CPU cores for control and data plane processing along with hardware acceleration and connectivity for backhaul and radio interfaces,” says Nick Marshall, principal analyst, mobile networks.

Merger and acquisition activity is high in this segment – Broadcom’s acquisition of Provigent, Percello and NetLogic, Mindspeed’s purchase of Picochip, Wavesat’s sale to Cavium, Xilinx’s acquisition of Modesat, and Qualcomm’s purchase of DesignArt all indicate that there are significant revenue opportunities for baseband SoCs in the evolving distributed RAN and HetNet segments and that vendors are positioning themselves to challenge current leaders Freescale Semiconductor and Texas Instruments.

“With the latest SoCs available or becoming available over the next 6-9 months in 28nm silicon technology these will be some of the most advanced baseband ICs ever produced and raise the bar in terms of complexity,” continues Marshall.

Part of ABI Research’s Macro Basestations Research Service, these findings are part of a new report entitled “Next Generation Base Station Semiconductors” which profiles this market and outlines the activities of Altera, Broadcom, Cavium, Coherent Logix, Freescale, Intel, LSI, Mindspeed, Octasic, Qualcomm, Texas Instruments, Vitesse, and Xilinx who are all active in this area.