With the green shoots of recovery already underway, In-Stat is forecasting that technological advancements in DSC units will lead the push with an increased demand for compact DSCs.
Improvements in the pipeline include all glass lenses, additions to back-side illumination sensors that increase small optical format CMOS senstitivity and auxiliaries like Bluetooth, Wi-Fi and GPS as well as stereoscopic imaging.
While the pick up will be slow this year, the researcher estimates steady growth which will fuel global revenues to $43.5 billion by 2015.
"The DSC market will continue to evolve over the next five years. Semiconductor vendors have a renewed opportunity to address these new demands by supplying solutions to DSC manufacturers looking to differentiate from the competition on the following features: sensitivity, image quality, and video functions," says Stephanie Ethier, Senior Analyst.
"Compact DSC revenue will remain relatively flat over the forecast period; however, the technology will continue to improve," she forecast.
The analyst expects revenue growth in the DSC market to surpass compact fixed lens cameras as sensor pixel sizes become less important than image quality.
Semiconductor vendors will also continue to take advantage of opportunities in sensors, image processors, inertial (MEMS) components and microcontrollers, according to In-Stat.