In the decade to 2010, semiconductor consumption changed dramatically.
Until around 2000, growth in semiconductor consumption was driven by desktop computers, Office computers, wired communications equipment and home appliances.
Subsequently, notebook computers, digital appliances and mobile phones began to rise, and the main consumer of semiconductors from enterprises to households and individuals.
Recently, with the increasing number of semiconductor consumers, the trend of expanding consumption is increasingly obvious.
The reason is that rising incomes at the BOP (base of population: the poor with an annual income of less than $3,000) have gradually become a new layer of semiconductor consumers.
Currently, EMS and ODM manufacturing mode are the main electronic products for this semiconductor consumer layer.
EMS and ODM products now account for 32% of all semiconductor products, up from 8% a decade ago.
The changes in the last 10 years have far exceeded our predictions.
By the same token, changes in the next decade are also likely to be much greater than now expected.

Air conditioning, PCS and large-screen televisions will be rapidly popularized in Chinese cities

To make a prediction 10 years from now, you need to look back at history.

In Japan, refrigerators, washing machines and vacuum cleaners were called "three big pieces" in the mid-1950s, and color televisions, air conditioners and cars (private cars) were called "3C" in the mid-1960s. Durable consumer goods were gaining popularity.
In the 1970s, cassette recorders, stereo equipment, passenger cars, air conditioners and microwave ovens and other general popular products came out, electronic products began to be widely popularized.

With the increasing popularity of electronic products, along with the increase of consumer income, products are gradually upgraded and the number of products kept is also increasing.
In the 1970s, the black and white TV was gradually upgraded to color TV. Since the second half of the 1980s, refrigerators have been increasingly large, air conditioners have been upgraded from models with only cooling functions to dual-use models, washing machines have been fully automated, and TV screens are getting bigger and bigger.
In addition, in consumer durables, there are products where household penetration (the number of households kept divided by the number of households) exceeds 100%.
Take color TV as an example, nearly 40% of households have more than 3 sets.

In China's urban areas, refrigerators, washing machines and color televisions have become popular as basic durable consumer goods.
Penetration of these consumer products roughly reached the upper limit in the 1990s, but color TV penetration continued to expand beyond 100 percent.
Air conditioning began to be widely used in the 1990s, while mobile phones and PCS began to be widely used in the late 1990s.
These durable goods have brought people a more comfortable life than basic consumer durables and are proof that China's urban areas have entered a highly consumer society.

Let's take a look at the rate at which consumer durables are gaining popularity.
It took about 20 years for refrigerators, washing machines and vacuum cleaners to reach their peak, compared with 15 years for China's urban areas.
Because China's urban areas have a larger population than Japan's, it had been thought that adoption would take longer.
But that does not seem to be the case.
Products that are expected to gain rapid popularity in China's urban areas over the next decade include air conditioners, PCS, cars and large-screen televisions.
Moreover, it is expected that the high level of consumer durables experienced by Japan in the 1980s will make significant progress in China's urban areas over the next decade.

Countries are pushing ahead with energy infrastructure and healthcare reform

Another important change is that the world is moving forward with energy infrastructure and health care reform.
Countries are accelerating the introduction of smart grids.