Market Challenges And Opportunities

The high consumption of power compared to ASIC is anticipated to hinder the market growth.

Field Programmable Gate Array Market Opportunities

Growth in emerging applications like AI and machine learning: Artificial intelligence and machine learning have become important technologies that are driving innovation across many industries. As these applications continue to grow more complex, the need for high performance computing grows exponentially. FPGAs are uniquely positioned to meet these demands due to their reprogrammability and ability to be tailored for parallel processing workloads. Many AI and ML tasks, such as image and speech recognition, require billions of mathematical operations per second to achieve useful results. The demand for AI and ML capabilities is projected to surge across many different sectors in the coming years. For example, according to 2021 data from the United Nations, the number of internet of things connected devices worldwide is expected to grow from 7 billion in 2017 to over 25 billion by 2025.
Increasing penetration of eFPGAs into military and aerospace industry: Customizability, fast prototyping, real-time processing, space optimization, security, fault tolerance, legacy system integration, and adaptability to evolving standards are among the advantages of using eFPGAs in the aerospace sector. Because of these advantages, eFPGA has emerged as a valuable technology for enhancing the flexibility, dependability, and performance of aerospace applications. eFPGAs are used by the military for a variety of tasks, including lifecycle management, fault tolerance, secure communication, real-time processing, hardware acceleration, legacy system integration, and SWaP optimization.

Field Programmable Gate Array Market Drivers

The Increasing Demand from Telecommunications Sector: The global telecommunications sector has been witnessing rising demand for faster and more efficient networking solutions to support the proliferation of smart devices and the increasing internet traffic. Field Programmable Gate Arrays or FPGAs have emerged as a preferred technology for telecom equipment manufacturers to develop their networking hardware for applications such as packet processing, traffic management and 5G infrastructure development. The reprogrammable nature of FPGAs allows telecom companies to update the hardware for integrating new features and protocols without having to design new application-specific integrated circuits (ASICs) from scratch.
The Department of Telecommunications (DoT) aims to achieve several key objectives by December 2022, including providing 100% broadband connectivity in rural areas, achieving a 55% fiberization rate for mobile towers, ensuring an average broadband speed of 25 Mbps, and deploying 30 lakh kilometers of optic fiber across the country. As of September 2022, the number of broadband connections has increased significantly to 816 million, marking a remarkable growth of 1238% since March 2014 when it stood at 61 million.
Rise of Edge Computing and Data Centers: With the proliferation of data consuming internet-of-things (IoT) devices and data-intensive applications such as artificial intelligence, the demand for distributed computing infrastructure has grown significantly. Edge computing deploys application-specific hardware such as FPGAs at the network edge to enable real-time processing and analytics close to the source of data generation rather than routing all data to centralized cloud data centers. This brings advantages like lower latency, network bandwidth savings, operational efficiency and better end-user experience. At the same time, to support rapidly scaling cloud-based workloads, data center operators also prefer reconfigurable FPGAs over application-specific ICs for their flexibility and power-efficiency.

Field Programmable Gate Array Market Restraints

Dynamic nature of technological changes: The dynamic nature of technological changes is placing limitations on the growth of the Field Programmable Gate Array (FPGA) market. As technology in the semiconductor industry advances rapidly, FPGAs need to constantly evolve and upgrade to newer process nodes to keep up with demand. However, transitioning to newer nodes requires huge investments of time and capital. For FPGA manufacturers, developing products for emerging technologies like artificial intelligence and 5G is a complex and lengthy process that involves extensive research and development. The high upfront investment and risks involved deter some customers, especially smaller players, from fully embracing FPGAs. According to data from the International Telecommunication Union, worldwide 5G subscription numbers grew from around 16 million in 2019 to over 228 million by the end of 2020 despite delayed rollouts due to the pandemic. However, the pace of 5G adoption is still below initial projections indicating technology transitions pose difficulties.
Counterbalance: The continuous advancements in technology can help in overcoming the complexity of designing FPGA circuits. New design tools and methodologies are being developed that can simplify the design process and make it more user-friendly. The increasing adoption of AI and machine learning in various industries can provide ample opportunities for the FPGA market. FPGA can be used in AI and machine learning applications due to their reprogrammable nature and high performance.