What is an Analog-to-digital Converter

Analog-to-digital converters (ADCs) are used in electronic devices to convert analog signals into digital signals. 

BREAKING DOWN Analog-to-digital Converter

Analog-to-digital converters (ADCs) convert analog signals, continuous waves that can’t be read by computers, by changing the signal strength and frequency into a digital (binary) number. Digital-to-analog converters (DACs) run this process in reverse.

Computers are quite powerful calculators, but in order to run, they have to quantify inputs into distinct numerical units, collectively called data. Inputs from the natural world are not quantified, so older methods of capturing information from the natural world copied them as analogies onto other media, like sound waves that were etched onto vinyl to make long-playing records, better known as LPs.

In order to digitize analog inputs so computers can read them, ADCs sample the analog input and calculate a numerical value for different states at various times. The quality of an ADC depends on its maximum rate of sampling and how it normalizes errors, as well as the dynamic range of inputs it can reproduce. ADCs are used in many specialized and commercial products including adaptors for television and radio technology, wireless technology for headphones, laptops, and so on, streaming services, musical recordings and medical imaging.

Both analog-to-digital and digital-to-analog converters offer examples of enabling technology.

Analog-to-Digital Converters for Investors

With technology offering ever-present opportunities to move old models into new, digital terrain, there are opportunities for investors in analog-to-digital converter market. This is evidenced by market research company interest, such as Zion Market Research, who in 2016 released a report on the analog-to-digital converter market called “Analog To Digital Converter Market: Global Industry Analysis, Size, Share, Growth, Trends, and Forecasts 2016–2024.”

The global analog-to-digital converters market is segmented. These segments are based on region and product. Product segments include direct conversion, or flash, ADC; integrating, or dual-slope or multi-slope, ADC; pipelined ADC; ramp-compare ADC, sigma-delta ADC, successive-approximation ADC and others. These segments are found in both industrial and consumer markets.

Companies that produce and make use of analog-to-digital converters include Texas Instruments, Intersil, Sony Corporation, Maxim Integrated, Adafruit Industries, and Analog Devices.

Major Players in the ADC Market

Analog Devices, headquartered in MA, is a multinational semiconductor company specializing in data conversion and signal processing technology. The company claims to have the industry’s largest portfolio of digital to analog converters (DACs), which range from 8 bits to 24 bits. Their products are used in industrial automation, programmable logic controllers, optical transceivers, and data acquisition.

Texas Instruments is a global Fortune 500 company that entered the semiconductor business in 1958 after the invention of the integrated circuit. They began working with digital signal processors in the 1980s. They offer high-precision discrete DACs, integrated precision ADCs and DACs, and 4-20mA and HART-enabled devices.