Semiconductor Intellectual Property (IP) Market Size, Share, Industry Report, and Growth Drivers – 2029

The semiconductor intellectual property (IP) market was valued at USD 7.5 billion in 2024 and is projected to reach USD 11.2 billion by 2029; it is expected to grow at a CAGR of 8.5% from 2024 to 2029. Factors such as increasing demand for advanced semiconductor components in telecom & data centers, and automotive sector, and expanding embedded digital signal processor IP and programmable digital signal processor IP segments create lucrative opportunities whereas constant technological changes resulting in increased expenditure, and concerns related to Moore’s law major restraint for the growth of the semiconductor intellectual property (IP) market.

Driver: Increasing demand for electronics in healthcare and telecommunications industries

After the recent pandemic, the demand for new and advanced medical equipment to conduct analysis and diagnosis has increased in the healthcare industry. Portable medical equipment, for instance, patient monitoring devices, witnessed a surge in demand throughout the pandemic.  The increased global awareness has created an immense demand for personal monitoring devices even after the pandemic.

Large infrastructure equipment, such as medical imaging systems and biochemical analysis equipment, is used in the healthcare industry. These instruments feature low system noise and consume less power; this was made possible because of semiconductor intellectual property (IP) licensing available to medical device manufacturers, helping them solve unique design challenges. Conventional medical equipment has long relied on software solutions and complex electronics to function.

The telecommunications industry also saw an increased demand for electronics during the pandemic due to the implementation of work from home (WFH) and remote learning policies. Easy-to-use communication tools that enable remote work and learning, as well as teleconferencing instruments witnessed a huge spike in demand during the pandemic period.

Semiconductor IPs are used in the telecommunications vertical for networking, video communication, voice communication, wired infrastructure, and wireless infrastructure telecommunication equipment manufacturing.

Restraint: Concerns related to Moore’s Law

According to Moore’s Law (stated by Gordon Moore, the founder of Intel, in 1965), the number of transistors in a dense integrated circuit will double approximately every two years. Moore’s words were true to an extent, but this increase in the number of transistors reached 3 billion, built over an advanced 14 nanometer (nm) manufacturing process. This technological advancement offered long battery life, computing, video capturing, mobile connectivity, and security features. However, no further advancements in IC technology were noted as the industry players continued to fail to develop a new process node of sizing less than 10 nm. This could mean that Moore’s Law becomes irrelevant. This can either cause a slowdown in semiconductor market growth, or end IC development. It could also result in new beginnings for the semiconductor industry, leading to modern technologies such as silicon photonics.

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Opportunity: Rising demand for advanced semiconductor components in automotive and telecommunications & data center verticals

Companies in the telecom & data centers, and automotive sector rely on sophisticated, complex electronic systems. The increasing demand for electronics and semiconductor components in these sectors created the need for innovative design solutions for chip manufacturing. The applications of MCUs, MPUs), analog ICs, sensors, interfaces, and memory in EVs, HEVs, autonomous vehicles and premium vehicles are increasing. As the significance of electronics mobility, connected cars, and vehicle connectivity increases, the demand for small gadgets with high functionality and performance improvements in the automotive sector is also expected to increase rapidly. Thereby, creating opportunities for players operating in the semiconductor intellectual property (IP) market.

Challenges: Increasing IP thefts and counterfeiting

 A majority of IP thefts, counterfeiting, and conflicts take place in Asia Pacific. IP thefts and counterfeiting lead to prohibitive costs. IP thefts mainly take place in ASIC and FPGA semiconductor intellectual property (IP) cores; this has been a major area of concern in other critical submarkets of the semiconductor intellectual property (IP) market.

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