Like other sectors, the market for microelectromechanical systems (MEMS) stagnated during the economic downturn. According to a report by market research organization Yole Developpement titled “State of the MEMS Industry 2009 Report,” sales of MEMS-based products are slated to reach $6.9 billion in 2009, barely up from $6.8 billion in 2008. The flat market was attributed to a drop in automotive-based MEMS products, offset by a spike in consumer-based MEMS.

The good news, according to the report, is that the MEMS market is expected to take off again. Although the MEMS production equipment market is projected to remain flat until 2011, MEMS foundries are expected to exhibit more than 25% compound annual growth starting next year. MEMS foundries are expected to benefit from system manufacturers outsourcing MEMS manufacturing, with semiconductor foundries such as TSMC, UMC, and others jumping into the fray.

"The MEMS industry remains highly diverse and as such, the impact of the financial collapse and economic recession has been varied,” said Jean-Christophe Eloy, President and CEO of Yole Developpement. “While established applications have struggled, new ways to package and integrate MEMS devices in systems buttressed the industry. New MEMS devices are indeed growing very fast – two-axis gyros, MEMS IMU, and MEMS oscillators, to name a few.”

The study noted that the nature of MEMS innovations is changing, with most new applications linked to new usage of existing devices. With packaging averaging more than 40% of the cost of a MEMS device, strong efforts are being put to adapting the packaging to drive out cost and enable new applications.