"2011 Market Insights and Future Trends for CMOS Camera Modules"

Market Analysis of CMOS Camera Modules: Trends and Projections

Recent insights from a comprehensive study conducted by the Shuiqing Muhua Research Center reveal substantial growth in the output value of CMOS camera modules in 2010, marking a notable increase compared to the previous year. This surge can be attributed to three primary factors.

Firstly, there has been a significant enhancement in the pixel resolution of mobile phone cameras. The standard has shifted to 2 million pixels, with expectations for 3 million pixels to become the norm in 2011, and 5 million pixels anticipated to dominate by 2013. Secondly, the rise in smartphone shipments has played a crucial role, as these devices typically feature higher camera resolutions, often surpassing 3 million pixels. Lastly, the widespread adoption of 3G networks has facilitated video calls, leading to a proliferation of dual-camera mobile phones in the market.

In terms of market dynamics within the CMOS sensor sector in 2010, Omnivision emerged as a key player, leveraging Backside Illumination (BSI) technology to secure its position as the exclusive supplier for Apple’s iPhone. This partnership resulted in a dramatic increase in both shipments and revenue for Omnivision, with operating profits soaring by over 15 times, further solidifying its leadership in the industry. Looking ahead to 2011, the introduction of dual cameras in Apple's second-generation iPad and an anticipated rise in iPhone shipments will likely bolster Omnivision’s market presence, as Apple has already integrated its BSI products.

BSI technology is poised to become the standard for CMOS sensors. Initially developed by Sony, this technology has gained traction with manufacturers like Omnivision, TSMC, Samsung, SETI, and APTINA also adopting it. However, during this transition, production capacity may struggle to meet demand, particularly for CMOS sensors used in laptops, which are currently yielding low profits. Consequently, manufacturers may be reluctant to increase production, leading to anticipated shortages throughout 2011.

In the lens market for CMOS camera modules, Taiwanese manufacturers have shown increasing assertiveness, while Japanese companies have begun to falter. Daliguang has maintained its dominance in the industry, significantly outpacing its competitors. Asia Optical, the second-largest player, has benefited from its mainland subsidiary, Ethel Optics, which has seen a notable rise in shipments. Conversely, Japanese firms are facing challenges due to a strong yen and intense competition from Taiwanese manufacturers. These Japanese companies, despite being large enterprises, are not heavily invested in the CMOS camera lens segment, which represents less than 1% of their revenue. For instance, KMOT reported a drastic reduction in lens revenue for CMOS modules, dropping to one-third of its previous figures in 2009, while Fujinon also experienced a slight decline. Several Japanese firms may even consider exiting this market.

The standout performance in the lens market for CMOS camera modules in 2010 came from Yujing Optoelectronics. After suffering significant losses for four consecutive years from 2006 to 2009, the company rebounded by obtaining supplier certification from Apple in late 2009, becoming the second supplier of lenses for Apple's CMOS camera modules. This development led to a remarkable revenue increase of nearly 250% in 2010, with projections indicating that Yujing Optoelectronics' revenue could increase more than fivefold compared to 2009, and its gross profit margin could rise from -3% to 22%.

In the assembly sector for CMOS camera modules, 2010 witnessed robust activity, with Foxconn remaining the sole global leader in this domain. Lite-On transitioned its assembly capacity from Dunnan to the Lite-On Group. Both Samsung Motors and LG INNOTEK ramped up their shipments, while Sharp, once the largest player globally, experienced a decline in its rankings due to reduced shipments from Nokia.

In summary, the CMOS camera module market is characterized by rapid advancements in technology, shifting consumer demands, and competitive dynamics that are reshaping the landscape. As manufacturers adapt to these changes, the outlook for 2011 and beyond suggests continued growth and evolution within this sector.