Sensor Fusion in a State of Flux as Companies Fuse Together

Guest post by Tony Massimini, Semico Research

There has been a great deal of activity among companies within the sensor fusion ecosystem. Mergers and acquisitions are changing the competitive landscape.

As a quick background, sensor fusion is the technology of combining data from multiple sensors and deriving intelligence from that data.  It is the foundation for motion tracking, navigation, context awareness, location based services, augmented reality and more.  It is the basis for future innovative applications.  The brains behind sensor fusion is in the algorithms.  This is usually embedded in a 32-bit microcontroller core or similarly powerful processing device, known as a sensor hub.

In May 2014, Fairchild announced the acquisition of Xsens the Dutch company known for motion tracking software.  Xsens has been doing motion tracking for film and other such applications.  It has modules with low cost consumer grade inertial motion MEMS sensors from STMicroelectronics.  At the time of the acquisition, Fairchild also announced that it would be bringing MEMS sensors to market soon as well.

In the last couple of weeks there has been a flurry of activity amongst the sensor fusion ecosystem players.  On June 24, 2014 Audience announced it would acquire Sensor Platforms.  The buyout is expected to be complete by mid-July 2014.  On July 7, 2014 InvenSense announced it was acquiring two companies, Movea and Trusted Positioning, Inc.  These acquisitions are to be finalized by the end of September 2014.

Audience is a relatively small company with about $150 million in annual sales.  It has been known mainly for voice and sound processing.  It was designed into the Apple iPhone 4S but did not maintain its design win in Apple’s next generation iPhone.  Sensor Platforms is a third-party sensor fusion algorithm developer.  The company has been focused on context awareness and indoor navigation.  Sensor Platforms licenses its algorithm to OEMs and to sensor hub chip vendors.  Audience had been working with Sensor Platforms for its always-on sensor fusion for voice and motion and decided to acquire the company for $41 million.  The name of Sensor Platforms will no longer be used following completion of the acquisition.

Audience also has a motion processor, MQ100, which will launch late 2014.  This is a DSP based device which will function as a sensor hub controller.  The sensor fusion algorithm developed with Sensor Platforms will be embedded in MQ100.

InvenSense has been a fast growing company delivering inertial motion sensors (gyroscope, accelerometer magnetometer) in multi-chip packages with its digital motion processor.  The company has been focused on motion tracking and pedestrian navigation for mobile devices and wearables.  At the end of 2013 it acquired the microphone business of Analog Devices.  Movea, like Sensor Platforms, is a sensor fusion algorithm developer which licenses the algorithm to OEMs and sensor hub controller vendors.  Movea provides of software for ultra-low power location, activity tracking and context sensing.  Its IP is found in consumer mobile (smartphones and tablets), TV interaction and wearable sports & fitness applications.  Movea’s context analysis uses both motion and audio sensors.

Trusted Positioning Inc. (TPI) is a software company providing indoor/outdoor positioning solution for mobile and wearable devices.  This has been a key area of development for InvenSense.  TPI’s platform also provides inertial navigation software solutions for in-vehicle navigation, personnel tracking, and machine guidance and control.

Semico Spin

Semico has stated several times that the value for Sensor Fusion is in the algorithm.  The average selling prices for the sensors are falling rapidly.  The hardware is becoming more of a commodity.

These acquisitions show that the chip vendors want to add value to their products.

Sensor fusion is expanding to include more data sources.  Sound for always-on context awareness and to provide spatial awareness is the next step.  Therefore, the microphones are key elements.  More sensors for biological and environmental data will come into use.  InvenSense, Audience and Fairchild want to integrate more IP in their respective technologies.

Sensor fusion is moving beyond smartphones and tablets into wearables and other products.  At a MEMS Industry Group panel at the Consumer Electronics Show in Las Vegas, Jan. 2014, Semico stated that wearables with 9-axis or more and sensor fusion features would be a high growth market.  It was at CES 2014 that InvenSense and Movea in separate announcements revealed they had reference platforms for wearables with 9+ axis sensor fusion.  Clearly both companies were on the same page at that time.

Impact on the Market

Less than a year ago, there were four companies licensing sensor fusion algorithms: PNI Sensor, Sensor Platforms, Movea and Hillcrest Labs.

In June 2013 PNI announced an ASIC, Sentral, which embeds its algorithm.  It still licenses its algorithm but on a selective and strategic basis.

Following these recent acquisitions, it is assumed that licensing commitments involving Sensor Platforms and Movea will be honored.  It seems to Semico that it is unlikely future licenses will be extended.  Both InvenSense and Audience will have sensor hub controllers in competition with other companies.  Thus, the only remaining independent third party sensor fusion developer without a competing chip is Hillcrest Labs.

Hillcrest Labs has a wide customer base.  In March 2014, it was announced that Hillcrest Labs and Bosch Sensortec were collaborating on a sensor hub solution for head mounted displays and wearable devices.  Following the recent announcements concerning their competitors, Hellcrest Labs has seen an uptick in interest for their products.

OEMS want options and do not want to be locked into one supplier.  Semico believes that one option sensor hub vendors and OEMs will pursue is to develop their own in-house sensor fusion algorithms.  However, this expertise is in short supply.  This is a specialized area of study.  Even with a strong team it could take one to two years to get up to speed.

The market for sensor fusion and sensor hub controllers is growing rapidly.  Smartphones are currently the largest market, but the technology is being leveraged into other areas, especially wearable devices for sport, health, fitness and medical.

Semico forecasts that the market for sensor hub controllers will reach 2.5 billion units by 2018, CAGR (’13 to ’18) 27.4%.  The wearable market will see CAGR of 114% reaching over 300 million units for devices with 9-axes or more.

MEMS revenues due to sensor fusion will grow to $7.7 billion by 2018 CAGR (’13 to ’18) of 20.3%.  In 2013 MEMS revenues in sensor fusion applications account for 23.6% of the total MEMS market.  By 2018, this will grow to 34% of the MEMS market.

For more detailed information on the sensor fusion market and the companies mentioned in this blog, please contact Rick Volgelei at rickv@semico.com.  

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