By Russ Arensman, photography by Keith Skelton/Blackstar

When Sabrina Kemeny was a scientist at the National Aeronautics and Space Administration’s (NASA) Jet Propulsion Laboratory in the early 1990s, she and her colleagues found the electronics industry very reluctant to adopt a new image-sensing technology they had developed for use in the U.S. space program. “People said ‘no way, this will never work,’ ” she recalls. “They were practically pelting us with tomatoes at engineering conferences.”

Nearly a decade later, however, the industry’s skepticism has turned to enthusiasm, and the complementary metal oxide semiconductor (CMOS) image sensor technology the NASA researchers struggled to promote is finally gaining wide acceptance. In the next few years, CMOS sensors are expected to increasingly displace the charge-coupled devices (CCDs) that, until now, have dominated the $1-billion-plus market for sensors used in products such as video recorders and digital still cameras.

CMOS sensors’ inherent power efficiency and smaller size were initially attractive to the space program, where every bit of size, weight and power savings pays off in reduced launch costs. Those same qualities, however, are proving ideal for all sorts of battery-powered products, and are paving the way for a whole new generation of portable imaging products such as video- or still camera-equipped cell phones and electronic organizers.

Today, Kemeny is CEO of Pasadena, CA-based Photobit Corp., a company she and fellow NASA scientist Eric Fossum founded in 1995 to exploit image-sensing technology licensed from their former employer. Photobit’s CMOS sensor chips are used in low-cost PC cameras as well as high-end medical and industrial equipment, and the privately held company’s sales have swelled from $4 million in 1999 to a projected $20 million in 2000.

But Photobit’s founders are not alone in pursuing the CMOS sensor market. More than two dozen vendors are now vying for what many hope will become one of the chip industry’s hottest growth sectors. Competitors range from OmniVision Technologies Inc., a fabless Sunnyvale, CA-based company that also helped pioneer CMOS sensors, to some of the biggest names in semiconductors and consumer electronics, including Agilent, Conexant, Fujitsu, Eastman Kodak, Motorola, National Semiconductor, Philips, STMicroelectronics and Toshiba. Additionally, Dallas, TX-based Texas Instruments Inc. has confirmed plans to enter the CMOS sensor market soon, as have Japan’s big three CCD makers—Sony Corp., Sharp Corp. and Matsushita Electric Industrial Co. Ltd.

Cahners In-Stat Group, a Scottsdale, AZ-based market research firm, estimates that CMOS sensors accounted for just 7.2% of all image sensors shipped in 1999 and 6.2%, or about $62 million, of the industry’s $1 billion in worldwide sales. Yet by 2004, it forecasts, CMOS sensors will account for 50.8% of the units shipped, and 35.5% of revenues. Another market-research firm, San Jose, CA-based Frost & Sullivan, forecasts nearly 60% compound annual growth for the worldwide CMOS sensor chip market from 1998 through 2003, compared with 6.2% for CCDs. It expects market revenue for all types of image sensors to reach $1.7 billion in 2003.

	“CMOS image-sensor technology will eventually overwhelm CCD technology.” —Brian O’Rourke, senior analyst, Cahners In-Stat Group

Photobit officials are placing their hopes for success on their sensors’ superior performance. “We’re not the low-price leader,” Kemeny says. “But we have a very strong proprietary and technical advantage over our competition.” She claims the company’s sensors use smaller pixels, or light-gathering elements, produce higher-quality images and use less power than many competitors’ sensors. Photobit also boasts a strong intellectual property arsenal, including numerous patents licensed from NASA.

Market leaders

Market shares are difficult to measure in such an immature, fast-changing market. Cahners In-Stat, however, estimates that in 1999 the two leading CMOS sensor makers were Agilent and OmniVision, each with about one-fourth of the market (see graph). Other leading vendors at that time included STMicroelectronics Inc., St. Genis, France, Mitsubishi Electric Corp., Tokyo, Japan, Hyundai Electronics Industries Co. Ltd., Inchon, South Korea, and Conexant Systems Inc., Newport Beach, CA.

In many ways, OmniVision and Agilent are a study in contrasts. OmniVision, a six-year-old fabless company with about 75 employees, relies on foundries such as Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC), Hsinchu, Taiwan, to build its popular CMOS sensors. During its 2000 fiscal year, which ended April 30, 2000, the company shipped more than 4 million image sensors and recorded sales of $40 million, almost an eight-fold increase from its sales of $5.2 million in fiscal 1999.

While its growth has been impressive, OmniVision is clearly outweighed by Agilent, a diversified $8.3-billion technology powerhouse with 46,000 employees and its own chip fabrication plants. Agilent was spun off from Hewlett-Packard Co. in 1999 and has a long heritage in imaging, derived in part from HP’s successful printer business. Jason Hartlove, manager of Agilent’s imaging products business unit in Santa Clara, CA, says the company has been developing CMOS sensor technology since the mid-1990s, but had only limited success with them initially in handheld scanners. More recently, it has sold millions of the sensors used in optical computer mice.

Agilent introduced a line of CMOS image sensors for cameras in September 1999, and since then has shipped almost 8 million units. Last October, the company introduced a second generation of improved, smaller, CMOS sensors, as well as three image processors that convert CMOS sensors’ signals into formats required for computer, video or still cameras. Looking ahead, the company is focusing on getting its sensors designed into various portable communications products. “We’re really looking to differentiate ourselves in the imaging for communications market space,” says Hartlove.

Despite the companies’ vast difference in size and resources, OmniVision has thus far held its own, selling millions of low-cost, highly integrated CMOS sensors for digital cameras, security systems and electronic organizers such as the Palm from Santa Clara-based, Palm Inc. “We’re going after all the high-volume, low-end opportunities,” says Hank O’Hara, OmniVision’s vice president of worldwide marketing.

Unlike many rivals that produce complete camera modules—comprised of a CMOS sensor, a lens and supporting circuitry—OmniVision has focused strictly on image sensors. The company made a recent exception, however, by assembling its sensors into miniature, lipstick-sized cameras that are clipped to the bills of umpires’ caps during broadcasts of National Football League games to provide live “Ump Cam” coverage.

OmniVision and other fabless sensor makers say they are pleased with the support they are getting from TSMC and other foundry operators, including UMC, Hsinchu, Taiwan, and Tower Semiconductor Ltd., Migdal Haemek, Israel. TSMC, for instance, has just unveiled a new 0.25-micron manufacturing technology to produce CMOS image sensors. Developed in partnership with Photobit and sensor maker Y Media Corp., Irvine, CA, it surpasses the 0.35-micron technology touted by previous technology leaders such as Agilent, and already has allowed Y Media to develop a high-resolution CMOS sensor with more than 3 million pixels.

Yet Agilent and other large chip makers with their own fabrication plants believe they have a significant advantage in being able to control the manufacturing process. “I’m personally very glad to have my own fab,” says Agilent’s Hartlove. “It’s phenomenal how much of a difference [in sensor performance] you can make by tuning the silicon process.”

CMOS vs. CCDs:

The first CMOS image sensors were produced in the late 1960s, several years before CCDs, but they were quickly surpassed by CCDs’ superior image quality and lower signal noise. CCDs are still the technology of choice in most camcorders, high-end digital still cameras and various imaging products developed for science, medicine and factory automation.

During the mid- to late-1990s, however, the performance of CMOS sensors improved significantly, thanks to advances in chip manufacturing and signal-processing technology, which paved the way for a new generation of CMOS sensors with less noise, sharper pictures and better color reproduction.

CMOS sensors aren’t a simple technology, but they’re cheaper and easier to build than their CCD rivals in part because they require only one voltage, compared with CCDs’ three separate voltages. Also, while CCDs require special manufacturing processes, CMOS sensors share the same basic technology used to make 90% of semiconductor devices. That means chip makers can build CMOS sensors in the same fabrication plants in which they build most of their other digital and mixed-signal chips, which reduces production costs and lets CMOS sensors share new technology developed for other semiconductor product lines.

	“They’ve [CCD makers] been somewhat reticent to eat their own children.” —Rudi Wiedemann, marketing director, Zoran Corp.’s PixelCam division

CMOS sensors already offer significantly better price-performance than their CCD rivals, particularly at lower image resolutions, and the advantage is only expected to widen. That favorable trend, plus the electronics industry’s plans to launch an armada of new battery-powered telecom and entertainment products, bodes well for CMOS sensors, which typically consume only 10% to 20% as much power as CCDs. “The types of applications that are going to be growing at a very rapid clip in the next five years are those with small form factors and low power consumption,” says Cahners In-Stat’s O’Rourke.

Although CMOS sensors can’t yet match the image quality of the best CCDs, they are more than adequate for products such as toys, baby monitors, PC cameras, cell phones and fingerprint and currency readers. O’Rourke predicts that, as CMOS devices make further inroads into these markets, as well as into low- and mid-range digital still cameras, North American and European chip companies will take market share from Japan’s big CCD makers. “The significant amount of resources being devoted to developing CMOS image-sensor technology will eventually overwhelm CCD technology,” he predicts.

Not surprisingly, the CCD makers have been cautious in embracing CMOS sensors. “They’ve been somewhat reticent to eat their own children,” says Rudi Wiedemann, marketing director of Santa Clara, CA-based Zoran Corp.’s PixelCam division.

Tough technology

Despite their advantages over CCDs, CMOS sensors have proven to be surprisingly difficult to design and manufacture. One of the notable early casualties was Santa Clara, CA-based Intel Corp., which canceled its CMOS sensor development effort last year without ever bringing a product to market. “It wouldn’t be accurate to say that we quit the business, since we never were in it per se. We were just exploring this as an opportunity,” says Intel spokeswoman Mary-Ellin Brooks.

Prasan Pai, business and marketing director for imaging products at Conexant’s personal imaging division in Newport Beach, CA, says several companies that announced CMOS sensors a year or more ago still are not producing those devices in volume. “They may be able to design a sensor, but getting it into production, and getting good yields isn’t easy,” he says.

CMOS image sensors typically are built in older fabrication plants, because the sensors don’t require the narrow circuit widths needed for the latest microprocessors and memory chips. Most CMOS sensors require additional processing, however, such as depositing dye filters to interpret color images and tiny microlenses to increase the light collected by each pixel. Assembly and test is another challenge, since dust can contaminate the sensors before they are encapsulated in translucent material, and equipment vendors have only recently developed appropriate wafer handling and optical test systems.

Jitesh Vadhia, group director for data conversion and display systems at Santa Clara, CA-based National Semiconductor Corp., notes that besides the basic light-sensing pixel technology, CMOS sensors require significant amounts of analog and mixed-signal expertise for signal processing, noise cancellation and other functions. In September, National introduced its first CMOS imaging chips, which it claims use less power and offer better light sensitivity than competitors’ sensors. “The entry point is getting more and more difficult,” Vadhia says. “It’s taken us four years to develop all the know-how we have today and introduce our first products.”

Graham Townsend, STMicroelectronics’ Edinburgh, Scotland-based technical director of imaging, says some chip makers may have underestimated the challenge of building CMOS sensors. “A lot of the big semiconductor companies are guilty of being slightly arrogant,” he says. STMicro opted to buy its way into the market in April 1999 by acquiring Townsend’s former employer Vision Group PLC, an Edinburgh-based company that originally spun off from the University of Edinburgh and was one of the first to commercialize CMOS image sensors.

	“A lot of the big semiconductor companies are guilty of being slightly arrogant” in terms of how easy it was going to be to build CMOS sensors. —Graham Townsend, technical director of imaging, STMicroelectronics

Townsend concedes that the acquisition initially slowed the company’s product development efforts. But with the integration now complete, he believes the combination of Vision Group’s imaging technology with STMicro’s systems and manufacturing expertise will create a formidable competitor. “We’ve had 10 years of experience and four to five years of volume manufacturing experience, which is exceptionally important in doing this,” he says.

Other companies also have taken the acquisition route in recent months, including Conexant, which last May bought Sierra Imaging Inc., a Scotts Valley, CA-based maker of digital image processors and image-management software. In June, Zoran bought PixelCam Inc., a Campbell, CA-based maker of CMOS image sensors and integrated lens/sensor modules for $21 million. And in August, Agilent acquired the eCamera business unit of Palo Alto-based PhotoAccess.com Corp.

In each case, the acquiring company wanted to expand its CMOS imaging capabilities. Conexant, for instance, combined Sierra’s image processors and software with its own CMOS sensors to create a complete set of components for mid-range digital cameras with 1.3 million pixels, or 1.3 megapixels, of resolution. Similarly, Zoran was able to offer a complete camera design by combining PixelCam’s 1.3-megapixel CMOS sensors with its own digital signal processor (DSP) core and associated hardware and software. Agilent expanded its product line with an image-processing chip from PhotoAccess, as well as a camera design that lets users upload digital images directly to the Internet to be processed into prints, without connecting to a PC.

While Zoran, Conexant and a few other CMOS sensor makers are taking aim at the market for mid-range cameras with megapixel-and-above resolution, most CMOS sensors are still used in low-cost, low-resolution imaging devices, including toys and cameras that connect to PCs. Toy maker Mattel Inc., of El Segundo, CA, for instance, uses CMOS sensors in its BarbieCam toy camera. Japan’s Nintendo Co. Ltd. of Kyoto, Japan uses CMOS sensors in its Game Boy Camera , which clips onto its popular handheld game machines.

In the computer industry, a variety of companies, including Intel, are selling inexpensive digital still and video cameras that connect to PCs. Many introduced battery powered “dual-use” cameras this past holiday season that can be disconnected from the PC to take pictures elsewhere, then re-connected to download and print the pictures.

“CMOS has really taken over the market for under-$100 digital cameras,” says Michelle Lampmann, market research analyst for InfoTrends Research Group Inc. in Boston, MA. She doesn’t expect to see many CMOS-based cameras sold until late next year in the megapixel range, which is still dominated by CCDs. Still, she expects CMOS sensors to make rapid inroads into the fast-growing camera market. InfoTrends estimates that digital still camera sales, both CMOS- and CCD-based, will increase from 10.4 million worldwide in 2000 to 27.5 million in 2002.

Semico Research’s Merritt says digital cameras still are being used mainly by PC owners, and that few are being sold in traditional camera stores. In-Stat’s O’Rourke expects CMOS PC camera sales to soar when major PC makers begin bundling them as standard equipment, although that’s not likely until costs decline from the current $50 range to $20 or less. “Eventually they’re probably going to be included in a package with a PC, as a mouse is,” he says.

Pixel power

Improvements in image quality will certainly aid the acceptance of all digital cameras. CMOS image sensors consist of thousands, or even millions, of tiny silicon elements, called pixels, that absorb light and convert it into electrical signals. In general, the more pixels a sensor has the better-quality images it produces.

Most low-resolution sensors use the common intermediate format (CIF) of 352 x 288 pixels, or about 100,000 total pixels. The video graphics array (VGA) format of 640 x 480 pixels, or just over 300,000 pixels, creates images adequate for computer screens, but not equal to film camera prints. So-called megapixel cameras usually consist of 1.3 million pixels, arranged in a 1,280 x 1,024-pixel array. While their picture quality is good, most photographers agree that at least 2 megapixels of resolution is needed to match the quality of film cameras.

	“I’m personally very glad to have my own fab...It’s phenomenal how much difference [in sensor performance] you can make by tuning the silicon process.” —Jason Hartlove, Imaging Products Business Unit manager, Agilent Technologies Inc.

At the market’s high end, Rochester, NY-based Eastman Kodak Co. recently introduced a CCD sensor intended for professional studio photography with 16.6 million pixels. Just weeks later, though, Foveon Inc., Santa Clara, CA, startled the industry by announcing a 16.8-million pixel CMOS sensor that it vows will produce better images than either film or digital CCD cameras. The company, founded in 1997 by noted semiconductor pioneer Carver Mead, is 45% owned by Santa Clara-based National Semiconductor, which plans to begin manufacturing the 16-megapixel sensor in about a year, using 0.18-micron CMOS technology.

Kodak, which for years has produced image sensors mainly for its own use, began aggressively marketing both CCD and CMOS sensors to outside customers early this year. Chris McNiffe, vice president of sales and marketing for Kodak’s image sensor solutions division, says the company will continue to focus on high-performance “bleeding edge” imaging markets for government, scientific, industrial and professional photography users. But it also hopes to make inroads into higher volume consumer markets, particularly with its new CMOS sensors, which are being manufactured by Schaumburg, IL-based Motorola Inc. “Where we’ll hit the real home runs are in some of these new markets,” he says.

The Holy Grail

Many CMOS sensor vendors are taking aim at next-generation cell phones, which are expected to be equipped with either video or still-camera capabilities. Kyocera Corp., Kyoto, Japan and Samsung Electronics Co. Ltd., Seoul, South Korea, have already introduced hybrid handsets that combine cell phones with still cameras. Virtually every other phone maker is developing variations on the same theme to take advantage of the increased bandwidth soon to be available with third-generation (3G) wireless services.

“The cell phone marketplace will really be the Holy Grail for CMOS image sensors,” says National Semiconductor’s Vadhia, noting that cell phone shipments are expected to exceed 1 billion units yearly by the middle of this decade. Says In-Stat’s O’Rourke: “If you can capture even a tiny percentage of that, it would be a huge market for image sensors.”

Japan’s 3G cellular system is expected to begin operating in 2001, and sensor makers are scrambling to get their devices designed into the first handsets. STMicro’s Townsend says prototype phones are being evaluated by service providers and several contracts have already been awarded, though the winners have not yet been announced. While Japan’s phone makers are confident that video phones will be a hit there, he says, European and American vendors are wondering whether still cameras make more sense in their initial 3G phones.

Besides cell phones and cameras, sensor makers hope to put their devices into a variety of other devices, from organizers to video conferencing systems to special-purpose terminals for insurance adjusters.

Autos offer another potentially huge sensor market, although it’s likely to take longer to develop. OmniVision’s O’Hara says that eventually autos could contain more CMOS sensors than microprocessors. He envisions sensors to help drivers see what’s in their blind spots, sensors to control airbag deployment and even sensors in collision-avoidance systems. “It’s not one of these opportunistic markets like Web cams,” he says. “Autos will go on forever.”