RF GaN: Trends and Directions

Strategy Analytics has been tracking RF GaN market revenues since 2007 ( Figure 1 ). As with many compound semiconductor technologies, the defense sector played an important role in providing early funding for device and process development, and defense applications became early adopters of RF GaN devices. Between 2007 and 2013, approximately 85% of RF GaN device revenues came from defense applications, with sporadic adoption of GaN devices by commercial applications, primarily for proof of concept and low-volume applications.

In 2013, RF GaN device revenues reached an inflection point, with a sharp upward trajectory in revenue growth. Much of the early proof-of-concept activity came from base station equipment manufacturers evaluating the reliability and performance characteristics of GaN power devices for future designs. Chinese equipment manufacturers became enthusiastic adopters of GaN technology in next-generation base stations. China’s decision to rapidly deploy 4G LTE nationwide propelled Chinese equipment suppliers to become global leaders in base station equipment and drove a sharp rise in RF GaN revenues starting in 2014. As LTE deployments in China and other parts of the world approach saturation, 4G revenue growth has slowed; but the emergence of 5G has bridged well. Looking ahead, 5G base station deployments will be the strongest growth engine for commercial RF GaN revenues.

Figure 2 shows the historical breakdown of RF GaN revenues. The importance of the base station segment is obvious; equally clear should be the strong growth in RF GaN revenues from defense applications. Shortly after the peak in 2014, RF GaN revenues from base stations surpassed those from defense applications. But note that from 2007 to 2019, revenues from defense grew 75-fold as GaN technology became a key enabler of evolving defense concepts and battlefield strategies. If it weren’t for the extraordinary growth in base station applications, the RF GaN market story would be limited to growth in defense.

The radar market offers the largest opportunity for RF GaN devices. Compact, efficient power amplifiers make radars with active electronically scanned arrays (AESA) a “must have” for next generation and major retrofit projects across all sectors. These solid-state AESA radars can generate and combine multiple scanning and tracking beams, providing significant performance and reliability advantages over traditional radar architectures.

Like their commercial counterparts, defense communications networks are managing more data traffic and seeking bandwidth at higher frequencies. Different customers use different equipment and waveforms, constrained by the "mobility" factor of the mission. Satellite equipment on the ground and in space is key to all of these communications. RF GaN technology has the performance characteristics to meet these requirements and provide flexibility.

Current geopolitical events have severely impacted the future of the RF GaN market. The market share, inventory reserves, and preference for GaN amplifiers from local Chinese base station equipment suppliers have driven a significant increase in RF GaN revenue. As shown in Figure 2, RF GaN revenue for base stations more than doubled from 2018 to 2020.

Of course, no discussion of 2020 would be complete without mentioning the coronavirus pandemic. The global economy is struggling to regain its footing, and the recovery has been uneven. The pandemic has forced many people and businesses to adopt a work-from-home model. Wireless and wired networks have become critical infrastructure. China has said 5G will be a driver of its economic restart. The rest of the world expects continued growth in 5G capital spending. Defense spending is closely tied to economic growth, raising concerns about the impact of the pandemic on defense spending. As the new U.S. administration’s defense goals remain uncertain, there is also uncertainty about the potential for defense spending to be redirected to a broader economic stimulus.

Adoption of RF GaN devices has increased significantly over the past few years, with revenues exceeding $1 billion for the first time in 2020. Since 2018, RF GaN revenues have grown by just over 80%.

Several challenges will affect the growth trajectory of future revenue. The deployment of 5G base stations will drive revenue growth, and the timing of China's purchase of more 5G equipment will be an uncertain factor. Defense spending, which is closely tied to economic growth, is also uncertain as the global economy recovers from the epidemic.

Despite these issues, we continue to believe that RF GaN revenues will grow over the forecast period. Figure 3 shows our latest market segment forecasts for RF GaN revenues. We expect revenues in the defense sector to grow steadily, increasing market share in that sector. Infrastructure revenues have grown too fast in the past due to investment from Chinese manufacturers, and we forecast revenues to decline slightly this year until mmWave deployments using GaN revive revenue growth. While the “other commercial” segment has modest revenues, applications such as VSAT, backhaul, CATV, and especially commercial satellite communications are gaining momentum. We expect RF GaN revenues to approach $2 billion in 2025, continuing the GaN success story.

This article is from Microwave Magazine