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Walt Custer’s Annual Update from productronica 2017
November 21, 2017 | Patty Goldman, I-Connect007Estimated reading time: 6 minutes
Custer: Foil suppliers are obviously working on capacity and but besides PCB demand there is competition from another less price and quality demanding industry, so it's still a problem.
Goldman: Not only at a better price, but less stringent requirements, so it's an easier market. We're a pretty demanding industry and price-sensitive too.
Custer: In any case, the data shows that there might be a little bit of a relaxation of the prices for now. But we'll see how it plays out.
Goldman: What else do you see coming?
Custer: The thing that's interesting is to look at what are the next big markets? Personal computers have matured and cellphones are on the verge of maturing. Even though we get an iPhone 10 and the like, those markets are no longer growing at 50% or 100% a year. So you start looking at self-driving cars, 5G, medical electronics and things like that. I think robotics is certainly a growth area, and a lot of the assembly that comes back to the U.S. will be done robotically. 5G cellular has to emerge in a big way to support self-driving cars, in my opinion. I think that's going to be the next big market, and it's going to happen over the next couple of years.
Goldman: 5G in combination with automotive?
Custer: Yes. It's supportive of automotive. With the Internet of Things, everything’s connected, and it has to be connected very fast. So I think that will be our next big area to watch.
Goldman: Where do you see medical electronics fall—a distant second or a close second?
Custer: It's hard for me to assess medical electronics. I think we're going to see more remote medical electronics with 5G. You may have a surgeon in the U.K. operating on you robotically while you are in the USA.
Goldman: That's interesting.
Custer: You can make a whole list of things that are next generation, but 5G is worth watching.
Goldman: Do you have any feel for how long things will continue in an upward mode?
Custer: They are still going up, but the rate of growth is peaking. I would say in this third quarter, we may have seen peak growth for the current semiconductor business cycle (Figure 3) and in addition then note that the annual autumn consumer electronics-driven busy season has ended. That doesn't mean that electronics demand is going to go down, but the rate of growth will be tempered until late spring.
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