LCD TVs: Market Price Stats Thread - AVS Forum
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This thread is intended to help track the current rapidly declining prices of LCD TVs. As per forum rules, no prices from any particular sales outlet will be posted. Rather, news from relevant industry sources on the topics listed below will be collected in a timely manner:
▪ MSRP and ASP (Average Selling Price) news, trends
▪ Market analysis & projections
▪ Product launches*
*Note: There are many blogs covering regular product launches. Since this category has been deemed a thread-cluttering hazard, only launches included within stories whose primary focus is larger market trends, and also products which set exceptionally market-defining pricing, will be included. Other threads in this group on the AVS Forum:
LCD TVs: Fab News Thread
LCD TVs: Technology Advancements Thread

Plasma TVs: Market Price Stats Thread

OLED TVs: Technology Advancements Thread
TDEL TVs: Technology Advancements Thread --------------------------------------

Flat screen war heats up, LCD catching up
2 March 2006

HONG KONG (Reuters) - Consumers are cheering their good fortune, watching prices for big flat-screen TVs tumble while makers slug it out to decide which display standard will become dominant -- liquid crystal (LCD) or plasma.

With the price slide, demand is booming in the key battleground for TVs -- flat screens in the 40-44-inch range -- and analysts say makers of liquid crystal displays (LCD) will probably gain ground in a market that has been dominated by plasma displays (PDP).

"Plasma display makers will do their best to cut costs and fend them off, but LCD makers are investing aggressively to go after the big-inch TVs and should be able to grab a good slice of that market, especially at 40 inches and just above," Hisakazu Torii, director of TV market research at DisplaySearch.

Companies such as Japan's Matsushita Electric Industrial Co. Ltd. (6752.T: Quote, Profile, Research) and South Korea's LG Electronics Inc. (066570.KS: Quote, Profile, Research) have preferred to use plasma screens for 40-inch or larger TV sets since they are easier to mass produce at larger sizes, giving plasma a cost advantage over LCDs.

Plasma TV sets use tiny pockets of gases to display images, while LCDs use crystals sandwiched between glass. LCDs last longer than plasma screens but are not as bright, while plasma has a wider viewing angle but consumes more power.

But prices for big LCD TVs will also come down sharply this year, as massive production ramp-ups are enabling LCD manufacturers to cut their own costs.

In 2005, the 40-inch LCD panel price dropped 36 percent, faster than a 31 percent fall for 42-inch plasma screens. DisplaySearch expects the panel prices to decline at a similar pace this year, with 40-inch LCDs and 42-inch plasmas both falling by about 25 percent.

"LCD panel prices will show a moderate fall in the first half on demand ahead of the World Cup soccer tournament, but the price fall will accelerate in the second half, given ramp-up plans at makers such as LG.Philips LCD Co. Ltd. (034220.KS: Quote, Profile, Research) and Sharp Corp. (6753.T: Quote, Profile, Research) ," said Lee Min-hee, an analyst at CJ Investment & Securities.

One company that sells both standards, Samsung Electronics Co. Ltd.'s (005930.KS: Quote, Profile, Research) , currently prices its high-definition 42-inch plasma TV set around $2,600 while its 40-inch LCD TV set can be bought for less than $2,800.

"Anything 40-inch and above is still quite expensive for the consumers. We are making very active investments to bring the prices down," Chu Woosik, senior vice president for Samsung Electronics' investor relations, said at the Reuters Global Technology, Media and Telecoms Summit in Hong Kong.

DisplaySearch predicts LCD sets will account for 50 percent of the 40-44 inch flat TV market by 2009, compared with 6 percent in 2005, while plasma's share will fall to 49 percent in 2009 from 71 percent.

"We are still selling plasma, a few products, but our focus is purely on LCD," Fujio Nishida, Sony Corp.'s (6758.T: Quote, Profile, Research) European president, said at the Reuters summit in Paris. "The future is LCD. That's our decision."

However, plasma makers say their production cost-advantage and plasma's clearer images will give them a secure place in the fast-growing market. Makers such as Samsung SDI Co. (006400.KS: Quote, Profile, Research) , LG Electronics and Matsushita also plan heavy investments to add capacity, raising concerns among analysts about a potential glut.

"PDP makers have more room to cut prices by improving technology and saving material costs," Chris Kim, Samsung SDI's vice president of PDP sales and marketing, said at the Reuters Hong Kong summit.

OLED

The market itself is rapidly shifting, with manufacturers always looking ahead to bigger screens and better technology.

"Eventually PDP makers will have to move their focus to above 50-inch when LCDs catch up in the 40-inch level," said Michael Min, an analyst at Korea Investment & Securities.

In the race for an edge, panel makers are also investing in organic light emitting diode (OLED) display, viewed as a promising next-generation technology.

Self-luminous and paper-thin OLED screens produce brighter images, respond faster and consume less power. Makers expect OLED displays to replace LCDs on mobile phones starting next year and eventually to compete with LCD and plasma for the monitor and TV panel market.

U.S. researcher DisplaySearch expects the global OLED market to grow to $5.1 billion in 2009 from $518 million last year.

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Overcapacity to delay LCD recovery: Merrill Lynch
23 March 2006

The recovery in the liquid-crystal-display (LCD) industry will arrive several months later than expected as overcapacity further drives down prices, investment research firm Merrill Lynch said yesterday.

The comments came after LG.Philips LCD Co, the world's top LCD panel maker, on Tuesday lowered its forecast for panel prices and shipments in the first quarter. The panel maker, however, raised its outlook for profits on falling costs.

We don't think it's something new ... Prices are falling faster than expected. The strength of growth momentum of all panel companies is weakening, Merrill Lynch technology analyst Daniel Kim told reporters after the conclusion of the second day of the firm's annual technology forum in Taipei.

The market expects panel prices to stabilize this month or next, and the rebound would be pushed back another few months, Kim said.

Kim blamed fast capacity growth for the unexpected fall in prices.

This has nothing to do with demand ... However, the capacity growth rate is faster than the demand growth rate, especially [from] the two South Korean companies," Kim said. "That is resulting in the oversupply.

LG.Philips LCD and Samsung Electronics Co have ramped up their new production lines, which manufacture panels for big-screen slim units such as 40-inch and 42-inch TVs, rather than for more mainstream 32-inch TVs.

Kim expects panel prices for TVs and computers to be weak before the TV shopping season in the second half of the year.

Another Merrill Lynch analyst, Jeffrey Su (蘇志凱), said the firm had retained an "overweight" rating on the LCD component sector, especially Coretronic Corp (中光電), chipmaker Novatek Microelectronics Corp (聯詠) and the Hong Kong-listed LCD TV and computer monitor assembler TPV Technology Ltd (冠捷).

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Samsung, Sony lead LCD-TV price declines, says Insight Media
24 May 2006




Samsung Electronics and Sony appear to be pushing new models into the market at leading price points in May, undoubtedly as a result of increased production at their joint S-LCD fab facility and others may follow next month as they try to match this downward trend, according to research firm Insight Media.

Pricing for LCD-TVs in the 40- to 44-inch size range saw a 5.8% decline in May compared to April pricing, reports the firm. The average retail price for LCD TVs in this ranged dropped US$182 from US$3,142 to US$2,960. PDP (plasma display panel) TVs in the same size range dropped by a smaller 1.5% (US$37) from US$2,547 to US$2,510. PDP TVs maintain and overall pricing advantage over LCD TVs, but the gap is shrinking.

By comparison, pricing for all MDTVs (mobile digital TVs) in the 40- to 44-inch size range were also down US$38 in May from April's data, falling 2.3% from US$1,649 to US$1,611. MDTVs continue to hold a significant price advantage over LCD-TVs and PDP-TVs.

Driving the price decline in 40- to 44-inch size LCD TV were big declines in panels with 1366x768 resolution clustered in the Brick & Mortar Channel group. Monthly pricing data revealed a surge in captured data points, with big increases for Samsung (32 to 99) and Sony (28 to 76) as the main drivers. Looking deeper with the 1366x768 resolution subgroup, Samsung has added five new models and reduced pricing on its previous two models. Sony added two new models and reduced prices on its other four models. These two brands account for 2/3rds of the 1366x768 resolution model price counts and show a price drop of US$283, which is higher than the average for the group.

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In North America, 40-inch LCD TV segment takes lead, but battle will continue
24 May 2006

The battle between the 40-inch and 37-inch LCD TV segments in the North American market has heated up since the fourth quarter of 2005. According to DisplaySearch, shipments of 40-inch LCD TVs in North America have outpaced shipments of 37-inch models since September 2005. However, the 37-inch segment was able to catch up and surpass the 40-inch segment in March 2006, as Sharp and LG Electronics began pushing more products in the segment. In April, the 40-inch segment once again took the crown in the region, the research firm indicated.

Fierce competition is also taking place in Europe. The sales volume of 37-inch LCD TVs totaled 180,000 units in the first quarter of this year, while the 40-inch segment lagged behind and totaled only 130,000 units last quarter, market sources pointed out.

Both segments need to watch out for the rise of the 42-inch segment as well. Prices for 42-inch LCD TVs recently fell even lower than that for 40-inch models due to a big promotion by Westinghouse Electric and Polaroid. The ASP (average selling price) for 42-inch LCD TVs is currently US$2,800 in North America.

The 37-, 40- and 42-inch segments will dominate the LCD TV market through the middle of 2007, according to Taiwan-based LCD TV makers. However, which of those segments will become the mainstream will depend on the competitive-pricing strategy offered by various vendors, the maker anticipated.

In 2006, 32-inch LCD TV shipments will total 14 million units while the 37-inch and 40/42-inch segments will each see about three million shipments, DisplaySearch stated in March.

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The 30 to 39-inch segment to remain mainstream in LCD TV market in 2010, says IDC
24 May 2006

Today's Chinese-language Commercial Times reported that although panel makers are looking to push 40-and larger inch LCD TVs, Bob O'Donnell, IDC's Program VP, Clients and Displays, anticipated that the 30 to 39-inch segment will remain the mainstream size in the LCD TV market for the next few years with the segment expected to account for 50% of the overall LCD TV market in 2010. O'Donnell spoke at a recent IDC Directions 2006 forum, held by IDC in Taipei.

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Global LCD-TV shipments rise 135% in 1Q
25 May 2006

LCD-TV shipments jumped 135% on-year, while falling 14% on-quarter to 7.4 million units in the first quarter of 2006, according to DisplaySearch.

The research firm said the LCD segment had the fastest on-year growth and smallest sequential decline of any TV technology in the first quarter, and its share rose to 17% from 15% in the fourth quarter of 2005.

As a result of gains by larger sizes, LCD TV revenues grew 114% on-year while falling 12% on-quarter to US$8.8 billion.

In terms of screen size, the average diagonal rose 19% on-year and 2% on-quarter to 27 inches, as larger sizes became more affordable, DisplaySearch said.

Average selling prices (ASPs) increased 2% on-quarter, while falling just 9% on-year to US$1,195. The sizes that gained share were the 37-inch segment, the 40-42-inch segment, the 20-21-inch segment and the 45 inches-and-larger segment, while the share of the 22-23-inch, 26-27-inch and 30-32-inch segments stayed flat, and other categories lost share. The 37-inch-and-larger segment rose to 14% from 12% on a unit basis, and to 32% from 29% on a revenue basis.

LCD TVs overtook CRT TVs in the 30-34-inch segment for the first time, on a unit basis, in the first quarter.

All regions enjoyed at least 116% on-year growth for LCD TVs except Japan, where growth was just 35%. Europe and China continued to take share from North America and Japan, with Europe's share rising from 44% to 46% on pre-World Cup demand, DisplaySearch remarked.

Four brands, Sony, Samsung, Philips and Sharp, dominated the LCD-TV market, accounting for a 50% share of units and a 54% share of revenues.

Philips was number one in unit sales but fourth in revenues, while Sony was number four in unit sales and number one in revenues. Sony had the greatest focus on larger sizes of the top nine brands, with 63% of its shipments in the 30-inch-and-larger segment, compared to Samsung with 51%, Sharp with 41% and Philips with 38%.

Philips was number one in unit sales in Europe and North America and led the 15-19-inch market worldwide. Sharp rose from number three to number two in unit sales worldwide, while remaining number one in Japan.

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Where is the LCD TV mainstream heading?
An interview with DisplaySearch president Ross Young
25 May 2006

Ross Young, the founder and president of DisplaySearch, recently spoke with DigiTimes about this year's outlook for the TFT LCD industry, the competition between Taiwan-based and Korean-based panel makers and the fierce battle to set the standard for the next mainstream LCD TV segment.

Q: Can you talk about your forecast for LCD panel supply and demand in 2006?
A: The second quarter is the traditional slow season and both the ASP (average selling price) and gross margins for panel makers will decline significantly. However, for the full year, demand for LCD panels will still be strong and the whole market is expected to rebound in the third quarter. Tight supply for the fourth quarter is expected to be worse compared to the third quarter. Q: What about the competition between Taiwan- and Korea-based panel makers? Which country now leads the LCD industry?
A: Taiwan-based panel makers saw improvement in the first quarter of this year. In terms of shipments, AU Optronics (AUO) accounted for 16.4% of the global LCD panel industry last quarter, with the company beating out LG.Philips LCD for the first time to become the second largest global LCD panel supplier. Samsung Electronics remains the top supplier in the market.

In addition, after officially taking over Quanta Display (QDI) in October, AUO will surpass LG.Philips LCD in terms of shipment area, with 21.4% of the market.

Taiwan also led Korea in terms of panels shipments by 2.4 percentage points in the first quarter. Shipments from Taiwan accounted for 46.2% of the market during the period, up from 44.2% in the fourth quarter of 2005.

However, since Samsung and LG.Philips LCD commenced volume production at their respective seventh-generation (7G) and 7.5-generation (7.5G) plants in January this year, Taiwan-based makers may need to accelerate their schedules to catch up with Korea-based companies in the next-generation TFT LCD production race. For Taiwan-based makers, how to improve yield rates and lower production costs at their 7.5G plants will be key issues to remaining competitive.

Taiwan-based panel makers may be able to take the lead in the 47-inch LCD TV panel market if they speed up their development. Q: Can you also describe the performance of the LCD TV panel market in the first quarter?
A: In terms of applications, LCD TV panels generated revenues of US$5.1 billion in the first quarter, marking the first time that the segment beat out the LCD monitor panel segment, which totaled revenues of US$4.8 billion.

The top five panel suppliers captured more than 90% of the total TV panel market. With the market scale of the the TV panel segment exceeding the monitor panel segment, the gap in profitability between first-tier and the second-tier makers is expected to increase.

Overall, global demand for LCD TVs will reach 42 million units in 2006 with the shipment volume in the first half totaling 16-17 million units. Q: What's the outlook of the 37-inch LCD TV panel segment this year? Will it beat out the 40- and 42-inch segments to become the market mainstream?
A: In the first quarter, the 37-inch LCD TV panel segment accounted for 8% of TV panel sales, compared with only 6.9% for the 40-42-inch segments. However, this quarter, the 40-42-inch segments will account for 9.8% of the market, while the share for the 37-inch segment will be 9.2%. This gap will increase by almost three percentage points in the third quarter.

Downstream, the 37-inch LCD TV segment is seeing pressure from the 40-inch LCD TV and 42-inch PDP TV segments. In the recent top 20 LCD TV list for North America, seven models are from the 40-inch segment while eight models are in the 32-inch segment. The 37-inch LCD TV took only one position.

The 40-inch LCD TV segment is strongly supported by Samsung Electronics and Sony, with the two companies ranked second and the fourth, respectively, in the global LCD TV market during the first quarter.

The ASP for 42-inch PDP (plasma display panel) TVs is approaching the ASP for 37-inch LCD TVs, which may also hinder its market share.

However, the 37-inch LCD TV segment will not be phased out. Q: If demand for 37-inch LCD TV panels is not as strong as expected, how should panel makers adjust their product mix at their sixth-generation (6G) plants?
A: Panel makers can still use their 6G plants for monitor and notebook panel production.

Demand for LCD monitors will increase about 5% per year over the next few years. With rising demand and a limited number of fifth-generation (5G) plants, panel makers could use their 6G plants to produce monitor panels. Q: How about the competition between 42- and 40-inch LCD TV panels? Will the ASP for 42-inch panels drop below that of 40-inch panels?
A: Most panel makers will focus on 42-inch panel production, which means more component makers will target this segment as well. With the increased production scale, prices in the segment stands a good chance of falling below prices in the 40-inch segment. ----------------------------------------------------------------------------------------------------

Fifty-inch LCD TV to become mainstream
26 May 2006

The 50-inch LCD TV segment will become mainstream in the TV market in the near future, with pricing to become competitive against same-sized PDP (plasma display panel) TVs, according to Hsiung Hui, executive vice president of AU Optronics (AUO) and David Choi, vice president of LG Philips LCD (LPL), as quoted by the Chinese-language Economic Daily News (EDN).

Panel makers are migrating to next-generation LCD production and production costs will decrease further, noted the paper. As a result, the 50-inch segment will become more competitive, the paper quoted Hsiung as saying. The price decrease for 50-inch LCD TVs will be faster than that for the same-sized PDP TVs, the paper quoted Choi as saying.

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iSuppli: Large-size panel prices nosedive, but stabilization to come in 2H
31 May 2006




Swelling inventories and disappointing demand from all applications are causing prices for large-sized panels to plunge in the first half of the year, with no relief expected until the second half, according to iSuppli.

Prices are falling for large-size panels used in notebooks, monitors and TVs. In some applications, including monitors, prices are falling to parity or below manufacturing cost levels for certain suppliers.

The oversupply situation worsened in April in the TV panel segment because inventories started building up in Europe in the first quarter due to slower-than-expected TV sales associated with the Winter Olympics.

This is placing an additional burden on the large-size panel market, which already was struggling with slower-than-expected notebook and monitor sales in the first quarter.

At the same time, most panel suppliers are continuing to expand their capacity, and are not cutting utilization rates or reducing production. Typically, large-size panel suppliers reduce their manufacturing utilization rates and slow their panel output during periods of oversupply. However, this year, most of them are maintaining their high production levels. This is because cutting production would actually increase their costs and impact their already-slim profit margins due to their huge investments in new production facilities.

TV panel prices slide

TV panel price reductions accelerated in April. Pricing for 32-inch and 40/42-inch TV panels declined by 7.3% and 7.2% from March to April, falling to an average of US$481 and US$879, comparing to a more moderate decline of 3.5% for the 32-inch panels and a 2.7% reduction for the 40/42-panels from February to March.

These declines came despite news from some suppliers that demand was reasonably strong for 40-inch-and-larger panels. However, demand was weaker than expected while rising production from newer-generation fabs contributed to the pricing freefall.

TV panel prices are expected to continue to decline through the third quarter.

The sinking of the monitor

Inventory build-ups and weak demand resulted in drastic price cuts for monitor panels in April. This brought prices closer to manufacturing cost levels for some suppliers - and even below cost levels for others.

Pricing for 17-inch monitor panels fell 12% from March to April while 15- and 19-inch monitor panel prices declined 9-10% during that period. In contrast, 17-inch monitor panel prices declined 4.1% from February to March, and 2.7% for 19-inch monitor panel prices during the same period.

Some panel suppliers are shifting capacity to panels for widescreen 19-inch and larger-size monitors. System vendors are clearing up the accumulated inventories in the distribution channel.

Price reductions have had the effect of improving end-user sales in some regions. Because of this, the rate of price reductions will slow in the coming months. By the end of the second quarter, the inventories are expected to clear up and an increase in demand likely will be seen due to back-to-school demand and the ramp-up in sales of Restriction of Hazardous Substances (RoHS) compatible products in Europe. This will shift the market back to a tight supply situation in August, resulting in panel price increases.

What good are notebooks?

Seasonally slow first-half notebook sales and the general reduction of inventories in the first and second quarters resulted in an oversupply situation for notebook panels in April.

From March to April, notebook panel prices for the 14- and 15-inch sizes fell 9.9% and 10.3%, respectively. This compares to reductions from February to March of 5.5% for 14-inch panels, 5.3% for the 15-inch size and 3.2% for 15.4-inch products.

By the end of the second quarter, most of the mainstream notebook panel prices are expected to decline to the US$95-110 range. The notebook market is expected to shift back to a tight situation by September, resulting in panel price increases due to back-to-school demand and holiday sales in the fourth quarter.

Capacity expansions on the way

Panel production capacity is continuing to increase in the second quarter. Most of the panel suppliers shifted production from the 17-inch size to 19-inch and larger widescreen panels or to large-size TV panels, rather than reducing the utilization rate in order to not increase cost. Capacity is increasing at a rate of at least 10-15% at sixth-generation (6G) and newer fabs.

Stronger second half expected

iSuppli projects oversupply of large-size LCD panels will persist throughout the first half. This will lead to price reductions during the first six months of the year for most panel sizes and applications.

The large-size panel market is expected to shift back to a tight supply situation in the second half and especially in the fourth quarter of 2006. Monitor panel prices will start increasing initially, followed by notebook panel prices in the third quarter of 2006. Meanwhile, the TV market is also expected to go into a state of tight supply in the fourth quarter, resulting in stable panel prices by the end of 2006.

Sweta Dash is the director of LCD and projection research at iSuppli. More information on the current market situation can be found in Dash's monthly LCD Health Watch report. For more information on this report, please visit: http://www.isuppli.com/catalog/detail.asp?id=7960

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DisplaySearch: Large-size LCD-panel revenues rise 58% on-year in 1Q
1 June 2006

Worldwide shipments of large-size (10 inches and larger) TFT-LCD panels rose 44% year-on-year, with revenues growing 58% to US$12.9 billion, according to DisplaySearch.

Revenue growth exceeded unit growth as a result of increased output of larger sizes, with area growth up 71% on-year, the average diagonal up 1.2 inches or 7% to 18.3 inches, and average selling prices (ASPs) growing 9%, the research firm reported.

According to DisplaySearch, with only TV-panel shipments rising sequentially and the average TV-panel diagonal rising to 28 inches, TV-panel revenues exceeded monitor-panel revenues for the first time, in the first quarter of 2006, at US$5.1 billion and US$4.8 billion respectively.

Unit shipments fell 5% sequentially, on seasonal weakness. With most panel suppliers expecting stronger results, panel inventories increased, resulting in rising pressure on prices. As a result, revenues fell 8% sequentially.

With panel prices weakening and inventory building, panel suppliers' margins fell from 12% in the fourth quarter of 2005 to 5% in the first quarter of 2006, but were up from -12% in the first quarter of 2005.

With panel prices continuing to fall rapidly in the second quarter of 2006, margins are expected to erode further. Monitor and notebook-PC panel prices are expected to stabilize in the third quarter of 2006 before increasing in the fourth quarter of 2006, leading to improved financial results.

Notebook-panel shipments fell 6% on quarter to 18.6 million units. Due to significant price erosion, notebook-panel revenues were down 16% on quarter, while rising 36% on year to US$2.5 billion. While the overall notebook-panel market was down, widescreen notebook panels continued to grow, rising 13% on quarter to capture a 62% share of all notebook panels shipped in the first quarter of 2006.

The dominant notebook-panel segment was 15.4 inches at 1280×800, earning a 36% share, up from 30% in the fourth quarter. The 14- and14.1-inch 1280×800 segment surpassed the 14.1-inch XGA segment to become the third most popular category of panel and is expected to overtake the 15-inch XGA segment in the second quarter to become the second most popular panel for notebooks. Samsung remained first in notebook panels, followed by LG.Philips LCD, Quanta Display, AU Optronics (AUO), and Chi Mei Optoelectronics (CMO).

LCD-monitor-panel shipments fell 9% sequentially in the first quarter, which resulted in double-digit price declines and an 18% sequential decline in revenues. However, there were some bright spots. The 19-inch-and-larger segment's share surged from 28% to 35% on 14% on-quarter growth, and the widescreen-monitor-panel segment's share rose from 7% to 10% on 14% on-quarter growth.

The 19-inch widescreen segment became the fourth most popular panel, while the commodity 17-inch SXGA panel's share is expected to fall below 50% in the second quarter. On an individual company basis, Samsung continued to lead in terms of units, revenues and total panel area shipped. AUO overtook LG.Philips for the first time to capture the number-two position with a 16.4% share. By country, Taiwan led on an areal basis, with a 55% share.

LCD-TV panel shipments were the only segment to enjoy sequential growth, rising 11%. Revenues grew nearly as fast as units, up 10%, with LCD-TV panel area shipped rising 15% sequentially on increased demand for larger sizes.

The 30-inch-and-larger segment's share rose to 48% in the first quarter, from 45% in the previous quarter. The 40-inch-and-larger share reached 8% on the success of Sony and Samsung LCD TVs, and panel suppliers expect this category to more than double to 17% in the third quarter of 2006. The top-five panel suppliers continued to dominate this segment, earning a 90% share.

In terms of total first-quarter output, on an areal basis, by supplier, Samsung retained the top position with a 22% share, leading in each major application. LG.Philips remained number two, but its share fell below 20% on a 6% areal decline. On an areal basis, it was number two in both notebook and TV panels, and number three in monitor applications.

AUO achieved 5% sequential growth to boost its area share to 15.4%. It was number two in monitors, number three in TVs and number four in notebooks. Chunghwa Picture Tubes (CPT) had the fastest area output growth of any supplier, up 16% sequentially.

By region, Taiwan suppliers overtook Korean suppliers for the first time, on an area basis, at 46% and 44% respectively.

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Quotes for 37-inch panel prices may drop to US$600 by 3Q
1 June 2006

Due to competition from the 40-inch segment and a continued capacity ramp up, quotes for 37-inch panels may drop to US$600 by the end of the second quarter or at the beginning of the third quarter, according to market sources.

Panel makers such as LG.Philips LCD and AU Optronics (AUO) are ramping up capacity at their sixth-generation (6G) plants. Prices for the 37-inch segment have fallen from below US$800 this February to below US$700 in April amid the capacity ramp up and competition among the makers, the sources indicated.

The quotes will drop US$20-30 in June, with the ASP (average selling price) likely to fall to US$620-630, the sources added.

However, panel makers may no longer suffer from rapid price reduction in the third quarter, because end-user prices have not dropped at the same speed during the first half of this year and LCD TV demand will become stronger in the second half due to seasonal effects, industry sources indicated.

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iSuppli: Innovation vs. business at SID 2006
5 June 2006




The annual conference of the Society for Information Display (SID) traditionally has been a venue for presenting technological developments, and this year's event will be no exception, with plenty of innovations expected to be shown. With an estimated 500 technical papers, 250 exhibiting companies and as many as 8,000 attendees expected at SID 2006, it's clear that there continue to be no lack of technological developments in the display industry.

Technology development vs. manufacturing

There's often a lag between technological developments of the sort that are disclosed at conferences like SID, and the start of volume manufacturing. As technologies move from the laboratory-curiosity stage to the prototype/sample manufacturing stage, activity increases as the prospects for commercialization draw new participants into the field; on the other side, as technologies move from development into mass production, there is often a falloff in technical breakthroughs-at least those shown publicly-as the focus shifts to increasing manufacturing efficiency and reducing costs.

Looking at the approximately 280 papers accepted for presentation at SID 2006, this pattern is evident. The chart below plots the number of papers on each major display technology, as assessed by the title, and compares this distribution to a plot of the stage of manufacturing, from pre-commercial to high-volume production. One can see that the peak of the paper distribution concerns OLED (organic light-emitting diode) displays, which are in low-volume production. In contrast, the more mature technologies have fewer papers associated with them.

Less mature technologies continue to gain momentum, as evidenced by innovations such as LED/laser projection. Because the development of active matrix/polymer OLED technologies is significantly behind that of passive-matrix (PM)/small molecule OLED, dividing the OLED papers further along these lines likely would illustrate this phenomenon in more detail.

Taking care of business

Although SID is a technical organization, as the flat-panel market has grown, there has been increasing focus on the business aspects of the industry. The business conference, added just a few years ago, has become one of the most popular elements of the SID conference; last year, an investors conference was added, expanding the business conference to three days.

The shift in emphasis from technology to business is a reflection of the maturation of the display industry, which is approaching US$100 billion in size. It is also reflects the growing commoditization of key segments of the market. Technology still matters greatly in the industry, but in large parts of the market, the amorphous silicon (a-Si) TFT LCD dominates, and business and technology trends are driven more by manufacturing investments than by developing fundamentally new ways of making a display.

In these areas, materials cost reduction and process simplification have become the most important types of innovations.

Large-size TFT LCD rules the roost...

Increasingly, the display market is being driven by TV and by TFT LCD technology.

In the near term, the industry has been too optimistic in its expectations for the LCD TV market. However, in the long term, iSuppli believes that there will be tremendous growth in LCD TV shipments, from 38 million units in 2006 to 128 million units in 2010. Revenue for large-size LCDs are growing rapidly, reaching US$44 billion in 2006, up from US$25 billion in 2005.

iSuppli expects large-sized TFT LCD revenues to surpass US$85 billion in 2010. However, the key will be for panel makers to maintain a reasonable level of profitability, which is always a difficult long-term proposition.

...but competition via investment can be painful

The large-size TFT LCD market has been experiencing rising levels of oversupply due to significant increases in production capacity. While conditions have been deteriorating for panel makers, declining prices and growing supply of larger screen sizes for LCD TV should spur a significant increase in demand in the second half of the year.

In the second quarter of 2006, the TV market, previously the area of strongest demand, has begun to appear saturated. In April, there was evidence of growing inventories, driven by over-production in hopes of a strong sales of LCD TVs for the Winter Olympics and the upcoming World Cup tournament.

With prices falling and supply improving, demand is increasing for the largest-size LCD TV panels, i.e. 40/42-inch and greater, and the 32-inch panel has started to become a commodity, with substantial oversupply and prices likely to reach US$400 by year's end.

In the monitor market, sales of 19-inch and larger panels have increased, as has the demand for widescreen panels. However, the oversupply in the mainstream panel market has worsened, and the 17-inch price has fallen below US$120. While panel makers would like to shift the market to the 19-inch size, there is still a US$40 price premium at the panel level.

Meanwhile, the outlook for the notebook market had been positive, but the delay in Microsoft's Vista operating system is causing some to lower their expectations for unit growth in 2006. Oversupply conditions in the notebook market are leading to some cuts in production.

The oversupply condition has resulted in price drops that have led second-tier panel makers to sell at levels below costs for some sizes. However, panel makers remain optimistic about long-term market growth, particularly in LCD TV. There is no slowdown in announcements of new capacity, particularly in seventh- and eighth-generation (7G and 8G) fabs.

For example, Samsung Electronics and Sony announced their plan to establish an 8G fab at their venture called S-LCD, and are boosting capacity at their seventh-generation fab. Chi Mei Optoelectronics (CMO) has announced a plan to invest in an 8G fab. Meanwhile, AU Optronics (AUO) announced its plan to merge with Quanta Display, which is expected to be completed by October.

PDP: Still glowing

Shipments of PDP (plasma display panel) continue to grow rapidly, with the market expected to reach nearly 10 million units in 2006, up 50% from 2005, during which the market grew 84%. iSuppli expects the plasma panel market to exceed 21 million units in 2010, driven by TV sales.

PDP makers Matsushita Electric Industrial, Samsung and LG Electronics (LGE) have been increasing capacity, but are challenged by rapid increases in sales of 40- /42-inch LCD panels, and soon 50-inch and larger panels. The resulting price competition will limit revenue growth for PDP makers severely after 2007, so manufacturing cost reductions will be critical.

OLED: From the frying pan into...?

OLED makers have made significant strides in increasing production, with shipments passing 50 million units in 2005 and expected to exceed 250 million by 2010. Nearly all of the OLEDs produced have been PM devices using small-molecule technology, although there is vigorous development of active-matrix (AM) versions, with polymer devices in the future, with the hopes of lower manufacturing costs. Given the vigorous price competition in the small-to-medium-size display market, OLED manufacturers will have to reduce prices to compete, thus limiting revenue growth somewhat, even as they roll out AMN devices.

Given its dependence on handset displays -in 2005, 60% of OLED revenues and 67% of displays were generated by the handset market-OLED is coming of age in a very challenging market.

Mobile phones have been a key market for LCDs, but as handset market growth has slowed, TFT LCD makers have sought to displace STN LCDs in both primary and secondary displays, and price competition has been severe. In 2005, handset display unit shipments grew by 19% to pass 1 billion, while revenues grew by less than 16% to US$12.7 billion. This occurred even as screen sizes, pixel counts and numbers of colors all grew.

While there are profitable niches in the small-to-medium-size display market, iSuppli expects LCD revenues in this category to peak at slightly more than US$23 billion in 2007.

Keeping on top of displays

SID certainly has maintained its position as the premier industry conference and tradeshow outside of Asia. While the production of displays is firmly centered in Asia, there are large end markets and numerous sources of technology innovations-from startups, corporate research groups and academic labs-which maintain a critical mass of activity for the display industry. If this year's SID is any indication, there is no sign of this trend slowing down.

Paul Semenza is vice president, display and consumer research at iSuppli.For more information on the display business, attend iSuppli's Flat Information Displays (FID) 2006 event in November. For more information, please visit: http://www.isuppli.com/fid2006/

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iSuppli: LCD-TVs to surpass CRTs by 2009
6 June 2006




In light of dramatic reductions in pricing and increased consumer acceptance, research firm iSuppli has raised its forecast for LCD-TV panel production in 2006, and now is predicting that LCD-TVs in three years will displace CRTs as the leading type of television manufactured worldwide.

iSuppli has boosted its 2006 forecast of shipments of LCD panels used in televisions to 46.7 million units, up from its previous prediction of 41.9 million units. LCD-TV panel shipments now are forecasted to rise by 74 percent compared to 2005, said the research firm.

"Increased production capacity from sixth- , seventh- and eighth-generation LCD fabs has led to rising availability and decreasing costs for the types of large-sized panels used in televisions," said Sweta Dash, director of LCD and projection research for iSuppli.

LCD-TV panel shipments in the first quarter increased by 7 percent compared to the fourth quarter of 2005, reaching 10.6 million units, Dash noted. As a result of this, and due to demand that fell short of suppliers' expectations in the first quarter, the average price for larger LCD-TV panel sizes, i.e. 32-inch and 40/42-inch, fell by 17 percent and 14 percent respectively in May compared to January 2006.

"Although LCD-TV panel demand increased in the first and second quarters due to sales related to the World Cup, shipments fell short of the expectations of some suppliers," Dash said. "Despite that, the second quarter is expected to bring continued growth for LCD-TV panel makers due to reduced prices and increased adoption among consumers. Shipments will accelerate further in the second half due to these factors."

LCD-TVs to surpass CRTs by 2009

Increases in capacity and falling prices for panels are impacting the LCD-TV market itself, causing consumers increasingly to choose LCD-TVs rather than sets based on CRT and other display technologies. LCDs accounted for 17 percent of television shipments in the first quarter, up from 15 percent in the fourth quarter, according to iSuppli.

With its rate of adoption accelerating, LCD will become the leading display technology for television by 2009, accounting for 48 percent of factory shipments. The CRT's share of the market will decline to 42 percent that year, marking the first time ever that CRT is not the leading technology for television display.

By 2010, LCD will account for the majority of television shipments for the first time, with 56 percent of unit shipments, iSuppli predicts.

LCD-TV panel market share shifts in favor of Taiwan

In terms of market share in the LCD-TV panel business, LG.Philips LCD (LPL) maintained its leadership in the first quarter, with 22.3 percent of unit shipments, according to iSuppli. The company's shipments increased to 2.4 million units in the first quarter, up 6 percent from 2.2 million in the fourth quarter.

Samsung, Chi Mei Optoelectronics (CMO) and AU Optronics (AUO) in the first quarter retained their second- , third- and fourth-place rankings with market shares of 20 percent, 18.7 percent and 16.8 percent, respectively. Both Samsung and CMO saw their market share decline slightly.

However, AUO managed to boost its market share on a strong surge in unit shipments.

The varying performances of Samsung and AUO can be attributed to the portion of the market they are choosing to serve. AUO is focused on increasing production of the popular 32-inch and 37-inch sizes, which are most efficiently made at the type of sixth-generation fab it operates. Samsung, on the other hand, has focused more of its capacity on higher-priced, lower-volume 40-inch and larger-sized TV panels, as it ramps up in its two seventh-generation fabs, one of which commenced production at the beginning of the year.

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LCD panel makers feel bite of ASP erosion in May
9 June 2006

With large-size panel ASPs (average selling price) continuing to fall, consolidated sales from most major Taiwan-based panel makers fell 7-20% sequentially in May, according to the companies.

Quanta Display (QDI) was the only major Taiwan maker to report growth in both sales and shipments of large-size panels during the period, while AU Optronics (AUO), Chi Mei Optoelectronics (CMO), Chunghwa Picture Tubes (CPT) and HannStar Display all had falling revenues.

QDI's consolidated sales increased 2.8% sequentially to NT$5.7 billion (about US$175 million) while its large-size panel shipments rose 6% to 1.25 million units, as the company cleared out of its inventory and demand for its products picked up slightly. However, sources expect QDI to continue seeing losses in the second quarter due to a slow industry performance. QDI reported losses of NT$667 million (about US$20.5 million) in the first quarter of this year.

HannStar's sales and shipments declined the most. The panel maker's sales fell 19.6% while shipments declined 17.2% sequentially. The company also reported net losses of NT$125 million (about US$3.9 million) in the first quarter of 2006.

Although both CMO and CPT saw rising large-size panel shipments in May, both makers' consolidated sales (including CPT's TFT business) still declined sequentially due to falling ASPs.

AUO recently made a downward adjustment on its its shipment goal for the second quarter, as its May consolidated sales declined 10.3% sequentially to NT$20.1 billion (US$618 million), amid a faster-than-expected ASP decrease, said company executive vice president Hsiung Hui.

Swelling inventories and disappointing demand from all applications caused prices for large-size panels to plunge in the first half of 2006, with no relief expected until the second half, according to iSuppli.

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LG.Philips LCD lowers shipment forecast, predicts sharper price decrease
12 June 2006

LG.Philips LCD expects its large-size panel area shipments to increase by a mid-teen percentage sequentially in the second quarter of 2006, a decline from the previous guidance of a mid-to-high twenties percentage increase.

LCD TV shipment growth at the end of the second quarter is expected to be approximately 25% sequentially, approximately 50% less than previously announced expectations, the company said.

The large-size panel ASP (average selling price) at the end of the second quarter is to decline by a mid-teen percentage quarter-end on quarter-end, compared to a mid-to-high single digit decrease guided previously.

The company's EBITDA margin is now expected to be around 10%, a decrease from the previous guidance of approximately 20%.

Several factors affected the global LCD industry during the second quarter. First, the industry experienced sharper-than-expected price declines across all product categories. In addition, while mid-to-long term demand for panels remains strong, LG.Philips LCD saw weaker seasonal demand during the second quarter, which has increased its inventory to about four weeks, a higher level than anticipated, commented Ron Wirahadiraksa, president and CFP of LG.Philips LCD.

Given these factors, the panel maker has decided to temporize production to address inventory concerns and better balance its short-term supply with demand. Furthermore, the maker is reviewing its total capacity plans for the year and beyond.

LG.Philips LCD expects to report final second quarter results on Tuesday, July 11, and will conduct a conference call at that time to discuss the results.

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LCDs tighten market grip
13 June 2006

San Francisco -- Like it or not, LCDs look to be the dominant display technology for the foreseeable future.

The 2006 Society for Information Display Symposium here last week was short on drama over platforms--no endless discussions over whether plasma can win the battle for supremacy in flat-panel TVs, scant debate about if and when organic LEDs (see story, page 14) will mount a serious challenge to LCD panels. Instead, the liquid-crystal display ruled the day, anointed by analysts and snaring much of the product and technology development attention.

LCDs continue to benefit from huge capital investments, and technical advances in backlights and display processes are eradicating some of the technology's performance drawbacks. "We simply don't see anything on the horizon that will challenge the LCD," said Paul Semenza, vice president of displays for market watcher iSuppli Corp. "The gestation period for new display technologies is measured in decades, not years, so the LCD's dominance will continue for some time."

LCDs are making strides in flat-panel TVs, said Joe Virginia, vice president of Samsung Inc.'s LCD Business in the Americas. He cited DisplaySearch Inc. predictions of a 28 percent CAGR for LCD TV sales, from 41.7 million to 111.4 million units, between 2006 and 2010.

Both DisplaySearch and iSuppli expect LCDs to overtake the longtime dominant TV display technology, cathode ray tubes, by 2009. DisplaySearch's projections call for LCD TV shipments to reach 96.9 million that year, compared with 90.4 million for CRT-based sets.

The key LCD suppliers--Sharp Corp., Samsung, LG.Philips LCD Co. Inc. and Taiwan's AU Optronics Corp.--have invested huge sums in state-of-the-art fabs that allow more-efficient production of large panels. The capacity influx has lowered panel prices and thus made LCD TV pricing more palatable. According to iSuppli, ASPs for 30- to 34-inch LCD TVs will fall below $1,200 by the fourth quarter, though analysts like IDC Corp.'s Bob O'Donnell contend prices must sink below $1,000 to attract the average consumer.

Nevertheless, the rapidly falling prices and rising availability for LCD panels over 40 inches are putting the squeeze on plasma, traditionally the preferred flat-panel technology for larger displays.

Plasma display makers are not standing still. Suppliers are making strides to improve plasma's brightness, power consumption, contrast and gray-scale characteristics, Takeshi Uenoyama, director of the Advanced Technology Research Lab and Image Devices Development Center at Matsushita, said during the SID keynote session.

According to DisplaySearch, plasma panels will soon be available with luminous efficiencies of up to 2.5 lumens per watt, up from 1.8 lumens/W a year ago. Glass thicknesses are dropping from 2.8 mm to 1.8 mm, and contrast ratios are improving from 3,000:1 to as much as 5,000:1.

Plasma display shipments will rise from 10 million in 2006 to more than 21 million by 2010, according to iSuppli. Revenue, however, will only grow from $7.7 billion to $9.8 billion over the same period, as falling plasma display prices squeeze profits, iSuppli predicts.

Peter Kwon, president and CEO of South Korea-based research firm Displaybank, expects retail prices for 42-inch plasma TVs to average $870 by 2010, only $95 more than the $775 average tag expected for 42-inch LCD sets.

Tech Progress

Meanwhile, LCD technology continues to advance. One limitation of LCDs has been the bulky backlight, based on cold-cathode fluorescent lamps. Attempts to use LEDs in place of CCFLs have fallen short, largely because of LEDs' high cost. At SID, Global Lighting Technologies Inc. demonstrated an LED-based backlight for a 40-inch-plus LCD panel whose edge-lighting scheme reduces the required number of LEDs to 22, according to David DeAgazio, director of global sales.

LCD contrast ratios are expected to improve from 5,000:1 to 7,500:1 by 2007, said David Choi, vice president of product strategy development for LG.Philips LCD. Philips Electronics is incorporating its Aptura lighting technology in 32- and 42-inch LCD panels to reduce motion blur and improve color rendition.

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Panel makers brace for price cuts, as LG.Philips cuts shipment goals
13 June 2006

With LG.Philips LCD cutting its shipment goals for the second quarter, panel makers expect sharp drops in prices for 37-inch TV panels, according to industry sources.

The sources pointed out that with LPL cutting its prices, the industry is seeing pricing in the 32-inch and 37-inch segments approach the US$400 and US$600 levels, respectively.

However, LG.Philips' pricing strategy has failed to solve its inventory issues, making it necessary for the Korean maker to lower its second-quarter shipment forecast, the sources said.

Prices for 32-inch panels are already close to production costs, and further significant price decreases are not expected. For the 37-inch segment, the sources predict that sharp price drops will soon begin, further eroding panel makers' profits. But prices for the 37-segment should stabilize in the third quarter, the sources added.

As LG.Philips has lowered its forecast for its EBITDA margin to about 10% for the second quarter, the company will certainly be in the red for the quarter, the sources indicated.

Its major competitors in Taiwan, AU Optronics (AUO) and Chi Mei Optoelectronics (CMO), may see profits of around NT$2-3 billion (US$61.2-91.7 million) and NT$1-2 billion respectively for the second quarter, the sources added.

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Falling LCD TV prices to spur demand in second half of year, say panel makers
14 June 2006

Although panels makers are cutting their forecast goals for the second quarter, TV makers still maintain a positive outlook for the second half of the year amid strong demand driven by attractive prices, according to sources at panel makers.

Although panel prices dropped dramatically in the first half of this year, system prices do yet completely reflect the changes, some panel makers stated. Therefore, once pricing for LCD TVs drop further in the second half, demand will pick up and inventory levels will drop, the sources pointed out.

LCD vendors, especially first-tier vendors, will continue adopting aggressive pricing strategies throughout this year to stay competitive, Taiwan-based flat panel TV makers pointed out.

Some first-tier LCD TV vendors have lowered their prices. Sony recently cut the price on one of its 40-inch LCD TVs (KDL-40S2000) by US$500 to US$2,499 while the price on a 32-inch LCD model (KDL-32S2000) was reduced US$200 to US$1,699, according to information from the company website.

LCD panel makers including LG.Philips LCD (LPL) and AU Optronics(AUO) recently cut their shipments goals for the second quarter due to weak demand.

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Samsung: US LCD sales to rise 75% in '06
14 June 2006

Samsung is expecting the US LCD market to explode this year - by 50 to 75%. We already know that LCDs are set to out sell CRTs in a few years so this might not be to far off base. They credit this to high-def gaming and HD DVD/Blu-ray. We think it is more along the lines of dropping prices and the increase in quality. Who doesn't want one of the nice, thin screens? A good amount of the videophiles that do the high-def gaming and movie watching already have a HDTV, but it is the Mom and Pop of America that is making the upgrade.

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CMO to ship 100,000 22-inch widescreen monitor panels per month by end of 3Q
14 June 2006



CMO widescreen monitor panels at FPD Taiwan 2006



CMO executive introduces company products at FPD Taiwan 2006


Chi Mei Optoelectronics (CMO) aims to see monthly shipments of its 22-inch widescreen panels reach the 100,000-unit level before the end of the third quarter, according to Kuo Chen-Lung, assistant vice president of the LCD-TV division at CMO.

With prices of 22-inch widescreen monitors soon expected to be lower than prices of 19-inch monitors on year ago, CMO is optimistic that the speed of widescreen replacement in the monitor segment will quicken, Kuo said.

Pricing is a key factor for the adoption of widescreen monitors, Kuo said. CMO shipped over 500,000 19-inch widescreen monitor panels in May, as prices in the segment dropped to around the same level as prices of 17-inch panels one year ago, Kuo indicated.

Using fifth-generation (5G) or 5.5G plants to produce 22-inch widescreen panels is very cost efficient, as a 5G glass substrate can be cut into eight 22-inch widescreen panels, with the number of cuts from a 5.5G substrate for the segment being 12, Kuo said.

CMO is now using its 5.5G plant to produce 1,680×1,050-resolution 22-inch widescreen panels, Kuo noted.

The panel maker is showing widescreen monitor panels at FPD Taiwan 2006 (Jun 14-16), with sizes from 19, 22, 24 to 30 inches and Kuo was speaking at the show.

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FPD Taiwan 2006: Corning sees 2006 as breakthrough year for LCD TVs
14 June 2006



Corning showcases its 8G glass substrate at FPD Taiwan 2006


US-based Corning, the world's largest supplier of glass substrates for TFT-LCD panels, said at the FPD Taiwan 2006 show that it sees 2006 as a breakthrough year for LCD TVs. Co-hosted by SEMI (Semiconductor Equipment and Materials Institute) and PIDA (Photonics Industry and Technology Development Association), the FPD Taiwan 2006 show started on Wednesday at the Taipei World Trade Center (TWTC) and the Taipei International Convention Center (TICC) as a part of three-days event series that also include OPTO Taiwan 2006, LED Lighting Taiwan 2006, Optics Taiwan 2006 and OptoCom Taiwan 2006.

Since the 3x price threshold was broken two years ago, LCD TVs are now expected to make a market breakthrough similar to color TVs in the 1960s and LCD monitors in the early 2000s, according to Corning. In 2006, the global LCD glass market will grow between 40% and 50% in terms of square millimeters shipped in total, and large-size substrates (above 5G) are expected to be the locomotive of that growth, with shipments increasing by over 150%, the company said.

Nitin Kulkarni, who was recently reappointed as president of Corning Display Technologies Taiwan, said that Japan remains the world's number one region in terms of LCD TV penetration, and the penetration rate is projected to increase from 48% in 2005 to 62% this year and 73% next year. However, Western Europe is still the biggest LCD TV market (followed by North America and Japan), but its contribution to worldwide LCD shipments will decline from 40% last year to respective 39% and 37% in 2006 and 2007, he said. China will soon become a huge LCD TV market, he added. Corning predicts that North America will account for 25% of global LCD TV unit shipments in 2006 and Japan will take 15% of the market, so the rest of the world is expected to have the remaining 21%. In 2007, the rest of the world is expected to contribute 28%, ahead of North America (23%) and Japan (12%), and the growth will be mainly driven by China, according to Corning.

Last year, global TV sales were about 190 million units, and LCD TVs contributed 11%, Kulkarni said. From 2005 to 2007, Corning sees LCD TV glass substrate demand increasing at a compound annual growth rate (CAGR) of 77% in terms of square millimeters shipped. As a result, the LCD penetration in the TV market will grow from 11% currently to 29% next year. Corning predicts that global TV sales will reach 205 million units in 2007, Kulkarni pointed out.

He also confirmed that Corning intends to begin commercial shipments of eighth-generation (8G) glass substrates (2160×2460 mm) from the Kakegawa (Shizuoka Prefecture, Japan) plant in the third quarter of 2006. So far, Japan-based Sharp is the only customer that signed a supply agreement with Corning to order 8G glass substrates. Last month, Corning announced that it will become the main glass substrate supplier for Sharp's 8G fab in Kameyama (Mie Prefecture, Japan), which is expected to open later this year.

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Large-size panel industry to bottom out in August: Q&A with Sweta Dash, director of LCD and projection research at iSuppli
16 June 2006

Large-size panel prices have fallen at a faster than expected rate while panel makers have trimmed their shipment forecasts in the second quarter. DigiTimes.com recently had the opportunity to meet with Sweta Dash, director of LCD and projection research at research firm iSuppli.

Dash shared with DigiTimes.com iSuppli's an updated forecast on the supply/demand of the industry, the domination of the 40/42-inch TV panel segment, the widescreen panel trend and a comparison of the competitiveness of panel makers in various regions.

Q: Monitor panel prices have fallen to approach the cost level of second-tier players while both AU Optronics (AUO) and LG.Philips LCD have trimmed their shipment forecasts. When do you expect panel price fall to ease? How about TV panel prices, in particular?
A: Prices for 17- and 19-inch monitor panel prices have fallen significantly. Although prices for the two segments are not likely to stop dropping in July, the prices will eventually stabilize and even pick up by US$1-2 in August. In fact, we remain optimistic about demand in the second half. The panel industry will swing from an oversupply ratio of 6% in the second quarter to a balance point in the third quarter, with a tight supply ratio of 1% to occur in the fourth quarter.

In fact, this year will follow the same pattern as those in previous years. The large-size panel industry always worsens when demand is weak, but the industry will eventually bottom-out. After that, demand always picks up because of already-significant price drops and reduction of production.

For TV panel prices, however, we expect to see prices for the segment to keep falling throughout 2006. Q: Among large-size LCD TV panels, various panel makers have been promoting different segments. For example, both Samsung Electronics and Sony are working to push the 40-inch segment with panels produced at their seventh-generation (7G) plants. LG.Philips LCD, AUO and Chi Mei Optoelectronics (CMO), on the other hand, are betting on both 37- and 42-inch panels from their 7.5G plants. What is your viewpoint on the 37-inch and 40/42-inch panel competition?
A: We expect to see coexisting 40/42-inch panel dominance in the future, as opposed to the 32-inch panel segment, the current mainstream size. Sony and Samsung are doing very well with their 40-inch panels and TVs, as capacity ramp up at their 7G plants are faster than those from their competitors and their pricing strategies have been especially successful.

Looking at the 42-inch segment, we are also very confident about its competitiveness since AUO, CMO and LG.Philips LCD will push the segment. The 37-inch segment, however, may be squeezed between 32- and 40/42-inch panels, as mature markets are ready to adopt larger-size TV panels.

In fact, the adoption of the 40/42-inch segment is much faster than we previously imagined. Originally, we expected prices for 40/42-inch LCD TVs would not come down to the US$2,000-2,500 range until the end of 2006. However, prices for the segment fell to US$2,500 in May 2006.

As a result, we expect shipments for 40/42-inch panels to reach 15 million units by 2010, up from only 1.2 million in 2005. Its penetration of the LCD TV panel market will reach 36% by then, with the 37-inch and above segment to account for 48% of the overall LCD TV panel market. Q: Besides promoting large-size TV panels at FPD Taiwan 2006, Taiwan's major panel makers are also showing a variety of widescreen panels for monitors and notebooks. What is your viewpoint on the trend?
A: We are definitely optimistic about the adoption of widescreen models for monitors. The adoption of widescreen ratios for notebooks has been smooth and this will help the adoption of widescreen monitor panels as well. The full line-up of widescreen models at the panel makers show their choice to develop niche products (larger-size widescreen models) during a down side of the crystal cycle.

Nevertheless, the penetration of widescreen monitor panels will not reach 10% until next year, with the penetration percentage reaching at most 7% in the fourth quarter of this year, up from a mere 2% in 2005. This is because the panel makers have not been aggressive in cutting prices for their widescreen models.

Prices for 19-inch widescreen panels, for instance, are still US$10 more expensive than regular ones. Among aggressive price reductions for 17- and 19-inch monitor panels, it is still hard for the widescreen versions to become dominant in the market. Q: You have mentioned panel makers used strategies such as focusing on niche products during a slow season. Besides rolling out new products, some of them are cutting their production to stay competitive while others have chosen mergers. Can you comment on the various possible strategies for panel makers?
A: It is very wise for AUO and LG.Philips LCD to rethink their capacity expansion in an oversupply situation. The merger between AUO and Quanta Display (QDI) is also an appropriate decision at the right time.

Panel makers need to expand next-generation capacity to stay competitive. However, price cuts and inventory build up are hurting panel makers' profitability. Therefore, second-tier panel makers can no longer benefit from price competition. It is either consolidation or getting out of the market. Japan-based panel makers have exited the market one by one when faced with an unpromising industry outlook. Taiwan-based panel makers need to start thinking about how to survive the cycle.

First-tier panel makers are still going to dominate the large-size panel industry, as they are better in component cost down, quicker in expanding capacity and have a better product portfolio. The same characteristic applies to first-tier makers in Taiwan and South Korea. They can easily switch between different applications to survive tough times.

Sharp, the major large-size panel maker in Japan, is an exception. The maker always makes sure it stays ahead in large-size TV panel production. By focusing on the large-size TV panel market, Sharp manages to have strong profits. In addition, a wide range of major component makers in Japan helps Sharp to remain very cost effective. Q: How about China-based panel makers such as Shanghai SVA-NEC Liquid Crystal Display (SVA-NEC) and Beijing BOE Optoelectronics Technology (BOE OT)? Are they able to stay competitive? What may be their future focus?
A: The China TFT LCD industry is very special in the choice of positioning. Companies such as SVA-NEC and BOE OT are still aiming at the monitor panel market when their competitors in Taiwan, Japan and South Korea can't wait to migrate to larger-size LCD TV panels. SVA-NEC is betting on the 15-inch segment while BOE OT aiming at the 17-inch one.

China-based panel makers are actually doing pretty well in their respective focus. Targeting the monitor segment, the panel makers can still benefit out of the abundant quantities the market still needs. Sweta Dash has covered the LCD and projection display industries since the early 1990s. She has more than fifteen years of experience tracking electronic display, semiconductor, and computer markets. At iSuppli, Sweta is the research director and lead analyst for LCD and projection display market reports and services. Her scope of research includes data analysis, market forecasting, and predicting future market and technology trends. Sweta is the author of numerous papers and she has spoken extensively at various industry conferences. She has a Bachelors of Arts degree with honors and Master of Arts degree in Economics from University of Toronto, Canada.

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Prices for 32-inch TV panels fall below US$400
19 June 2006

Taiwan panel makers, including Chi Mei Optoelectronics (CMO) and HannStar Display, have reduced their prices for 32-inch LCD TV panels to less than US$400, lower than the US$400 level that LG.Philips LCD (LPL) earlier approached, according to industry sources.

In an attempt to release their inventory clearance in the TV segment before demand picks up in the third quarter, the Taiwan panel makers recently lowered prices for 32- and 37-inch TV panels by up to US$30, compared to their May prices, indicated the sources.

For the 32-inch LCD TV segment, CMO and Chunghwa Picture Tubes (CPT) currently each have inventory turnover days of finished and half-finished products (combined) of almost one month, the sources found. Although AU Optronics (AUO) has lowered its inventory turnover days to 7-14 days, the higher inventory levels at Quanta Display (QDI) may extend the timeline, the sources added.

The sources expect that demand will pick up from the third quarter and rising orders will stop panel prices from dropping further from August.

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LCD panel prices drop to record lows
20 June 2006

Panel prices dropped to record lows across all segments in late June, but PC panels may rise in August because of back-to-school demand, according to WitsView Technology.

Panel pricing released by WitsView today indicated that the average selling price (ASP) for 17-inch monitor panels dropped U$3 to US$104 compared with prices in the first-half of June. The ASP in the 17-inch segment is already lower than the production costs at first-tier panel makers, according to WitsView, and the ASP is under pressure to drop further.

In the notebook panel segment, the ASPs for 15.4 widescreen and 15-inch panels both dropped to US$100, while 14-inch widescreen panels saw its ASP fall to US$97.

WitsView indicated that PC panel prices could bottom out in August when inventory pressure should ease to normal levels and back-to-school demand should kick in.

TV panel prices also dropped sharply. Prices for 32-inch and 37-inch panels both decreased US$25 to US$410 and US$610, respectively.

TV panel pricing will remain weak in June and July because World Cup-generated demand is finished. Demand for TV panels may again pick up in August because of the Christmas shopping season, according to WitsView.

However, fierce pricing and increased supply in the TV segment will see ASPs for TV panels continue declining through the end of the year, the research firm said.

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LCD closing price gaps with PDP in the 40-inch range, says TSR
23 June 2006

Prices of 40-inch WXGA LCD panels are now nearly at the same level as that of 42-inch 720p PDP (plasma display panel), according to Japan-based research firm Techno Systems Research (TSR).

Prices of 40-inch LCD panels were US$850 while 42-inch PDPs were priced at US$720 in the first quarter of 2006, compared to a price gap of more than US$100 between the two before 2005. Prices for 40-inch LCD panels will drop to US$750 in the second quarter of 2006, compared to US$690 for 42-inch PDPs, the research firm said.
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Thanks for the information. The Wall St. Journal had an article a month or so ago illustrating the precipitous price decline of PDP and LCD displays over the last 3-years. If you have a subscription you might be interested in checking it out.

LG Phillips LCD Co (google finance link) stock has taken a bath over the past few months as they have incurred massive expenditures on new production facilities amidst lower than expected demand for LCD Televisions (noted in article above).

As discussed in your information above, it appears that the main producers are locked into an expensive capital investment cycle that is depressing profitability. None want to blink though as any manufacturing disadvantage will directly impact the bottom line.

Once the industry slows down its capital investments we will likely see something resembling price stability in the flat panel market.

Cheers


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post #3 of 47 Old 06-16-2006, 12:59 AM
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Really should be a sticky......................

Abundant OTA television is what makes this country different from all others. Lets keep it this way.
The Internet is no place for streaming video.
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post #4 of 47 Old 06-16-2006, 05:20 AM
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Quote:
Originally Posted by videobruce View Post

Really should be a sticky......................

this really is an excellent thread: a lot of work went in to it: Thanks to Isochroma

not sure about a sticky right now- too many already
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Quote:
Originally Posted by markrubin View Post

this really is an excellent thread: a lot of work went in to it: Thanks to Isochroma

not sure about a sticky right now- too many already

Agreed, too many stickys. Just goto www.digitimes.com.
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Too much to wade through. The above seems to do a nice job condensing it into something meaningful for this forum.

Abundant OTA television is what makes this country different from all others. Lets keep it this way.
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I'm surprised about the high % for Phillips in the US. It's easy to understand about Europe, but not here.

Also, the figures for "projection" TV's I find really hard to believe that the #'s are that small. To me, that seems to exclude Microdisplays.

Abundant OTA television is what makes this country different from all others. Lets keep it this way.
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Isochroma:

This is EXCELLENT information. You have been doing some excellent work recently.
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post #9 of 47 Old 06-21-2006, 11:20 AM
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Thread Update:

21 June 2006: LCD panel prices drop to record lows

Link?
What % have they dropped, and since when?
When will we see MSRPs reflect this drop?
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Any ideas how the increase in 1080P LCD/PD are going to affect price drops? Should we expect the older 1080i sets to plummet even quicker? I'm trying to decide whether to buy a new 1080P or buy a 1080I when the price crashes even more.
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Any ideas how the increase in 1080P LCD/PD are going to affect price drops? Should we expect the older 1080i sets to plummet even quicker? I'm trying to decide whether to buy a new 1080P or buy a 1080I when the price crashes even more.

There's no such thing as a 1080i set. Maybe you are thining of 1368x768 or 1024x768 sets.
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AUO drops 32-inch panel prices to US$395, say sources
26 June 2006




AUO (AU Optronics) has recently informed downstream LCD TV makers that the company is offering 32-inch LCD TV panels at US$395, according to industry sources. The sources also indicated that the negotiating room for AUO's 32-inch panel prices is ranging from US$10 to US$20, depending on the volume of the orders.

AUO declined to comment on the news.

The ASP (average selling price) for 32-inch LCD TV panels, which had fallen below US$400, is now approaching the production cost of first-tier makers and the prices are unlikely to rebound this year, sources at Taiwan-based panel makers said.

AUO and LG.Philips LCD (LPL) are also dumping 37-inch LCD TV panels in the market in an attempt to clear inventory, the sources added.

Although some 37-inch LCD TV panels have fallen below US$600, TFT LCD panel makers can still make profits from the 37-inch segment, said the sources. However, price competition in the industry will continue next quarter, the sources noted, adding that the ASP for 37-inch TV panels will see another sharp drop at the beginning of the third quarter.

Nevertheless, the ASP for 37-inch TV panels will stabilize once it reaches US$520-550 at the end of July or beginning of the August, said the sources.

Compared to monitor panels, LCD TV panels have been more profitable. Therefore, when the ASPs for 32- and 37-inch LCD panels get closer for the first-tier makers, it becomes more and more difficult for the makers to maintain profitability, the sources indicated.

Morgan Stanley recently issued a forecast saying that AUO and Chi Mei Optoelectronics (CMO) may see losses in the second quarter, according to today's Economic Daily News (EDN).

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Panel makers conservative about panel price rebound forecast
27 June 2006

Although market research firm Displaybank recently said panel prices may rebound before September, panel makers said it remains to be seen whether panel prices will rebound.

Displaybank recently forecast that panel prices will bottom out between August and September, as panel makers will begin full-scale cuts of production from July while demand for TVs and IT products will seasonally pick up in the second half of the year. The expectations are on the assumption that production reductions will be maintained at least for three months, noted the research firm.

However, panel makers indicated that it will be difficult to realize the forecast since Samsung Electronics had said it will not cut its LCD production. With only makers including LG.Philips LCD, AU Optronics (AUO), Chi Mei Optoelectronics (CMO) and several second-tier panel makers in Taiwan cutting production, it will not be enough to help panel prices to rebound.

Both DisplaySearch and WitsView Technology, on the other hand, said there is no room for further panel price cuts now, as the ASPs (average selling prices) of panels for PC applications have dropped below the production costs of first-tier panel makers. With makers reducing production and back-to-school demand hitting in July, prices for PC-use panels will stabilize. It is not unlikely that the ASP will even rebound, the firms indicated.

Nevertheless, both market research firms and panel makers agree that TV panel prices are not likely to rebound in 2006. Prices for 32-inch panels will continue falling, but within a limited range, as the prices have approached makers' cost levels. The price drop for 37-inch panels may be less significant in the third quarter, sources said.

Prices for 17- and 19-inch monitor panel prices have fallen significantly and the prices will eventually stabilize and even pick up US$1-2 in August, according to Sweta Dash, an analyst with iSuppli. However, TV panel prices will continue falling throughout 2006, Dash indicated.

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Prices for 40-inch LCD TVs to fall below US$2,000 by year-end
3 July 2006




Prices for 40-inch LCD TVs are expected to drop to US$1,983 during the fourth quarter of this year, according to today's Chinese-language Commercial Times, citing data from DisplaySearch. The price gap between a 40-inch and a 37-inch LCD TV will further narrow to US$230 by 2007, the paper noted.

Prices for 40-inch LCD TVs were around US$2,349 during the second quarter of this year while prices for the 42-inch and 37-inch segments stayed at US$2,900 and US$1,902, respectively, according to a recent report from Hyundai Securities.

Samsung Electronics and Sony, supported by their joint venture S-LCD, are both pushing 40-inch LCD TVs. In April, shipments of 40-inch LCD TV panels from the seventh-generation (7G) plant, exceeded 330,000 units, surpassing monthly shipments of 37-inch LCD TV panels amid strong sales of 40-inch LCD TVs as well as rapid improvement in production yields, industry sources said.

The adoption of the 40/42-inch segment is much faster than previously imagined, Sweta Dash, iSuppli's director of LCD and projection research, pointed out recently. Dash also said that iSuppli is expecting to see coexisting 40/42-inch panel dominance in the future while 37-inch LCD TV panels may be squeezed out by the 32-, and 40/42-inch segments.

The market share of LCD TVs will account for 42% of the global 40-49-inch TV market in 2007, up from 29% this year, DisplaySearch pointed out during a FPD Taiwan forum.

In the competition between LCD TVs and PDP TVs, since prices for 40- and 42-inch LCD TV panels are getting closer to that of 42-inch PDPs, PDP makers are now moving their focus to 50-inch range segment to stay competitive, the panel makers pointed out. A 42-inch PDP TV was priced at US$2,257 in May, Hyundai Securities noted.

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Prices for 42-inch panels may fall to US$700 before 4Q
13 July 2006

Prices for 42-inch panels may fall to US$700 before the fourth quarter of 2006, despite being priced at US$800 in the second quarter, already below the cash-cost of 42-inch panels from LG.Philips LCD, the company said at its investors conference in the second quarter.

The ASP (average selling price) of the segment was US$780 in the first half of July, down US$10 from that in the second half of June, according to WitsView Technology.

WitsView expects the ASP of 42-inch panels to continue falling through the fourth quarter, but the price drop will be less significant in the fourth quarter, compared with that in the second and third quarters, since TV demand will pick up in the fourth quarter.

Sources indicated that the trend to reduced prices is not caused by a supply-demand imbalance but by the 42/40-inch TV-panel war between LG.Philips LCD and Samsung Electronics.

LG.Philips LCD has been aggressively lowering the quotes for its 42-inch panels, and the price difference between 42- and 40-inch panels is only US$30, now, sources said. However, LG.Philips LCD has higher material costs since its 7.5-generation (7.5G) plant has just entered production, the sources indicated.

In addition, industry sources estimate the 42-inch panel segment was the major reason for an 18% sequential increase in inventory to US$1.35 billion, at LG.Philips LCD, in the second quarter.

AU Optronics (AUO), which will see its first 7.5G plant entering volume production in the fourth quarter, will face more challenges because of the general tendency to cut prices, sources said.

AUO said it will host an investors conference on July 25 and declined to comment on prices for any segment.

AUO president HB Chen recently said AUO's first 7.5G plant will process 10,000 glass substrates per month during the initial stage of production, while a second 7.5G plant will begin production in 2007, with the combined capacity of the two 7.5G plants at 120,000 substrates per month.

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LCD industry retrenches as flat-panel prices crash
17 July 2006

Manhasset, N.Y. -- The warning signs were evident for weeks, and it now seems clear that the flat-panel display industry is slipping into a slump that industry watchers hope will be short-lived.

LCD panel suppliers, which have been the most aggressive in expanding their production capacity, have shouldered the brunt of the impact. LCD vendor LG.Philips LCD Co. Inc. said last week it would scale back capital spending and put plans on hold for a Generation 8 fab. Several other companies have also said they would delay or scale back fab ramp-ups and reduce capital spending.

Cyclical behavior has long characterized the flat-panel industry, but the free-fall in LCD prices caught at least one veteran analyst by surprise. "Many panel suppliers will not have a good second quarter," said Sweta Dash, director of LCD and projection research for iSuppli Corp. (El Segundo, Calif.).

Prices for panels used in 15-inch and "wide" notebook computers have in some cases fallen below $100, Dash said. Prices for 15-inch desktop monitor panels have also fallen below $100, and tags for 17-inch monitor panels now average $103.

Compounding the pain is that some vendors ramped up next-generation fabs ahead of schedule in anticipation of strong demand for high-resolution flat-panel TVs from consumers looking to upgrade for the World Cup. But the expected second-quarter boost did not materialize.

After having posted record profits in 2005, LG.Philips LCD (Seoul, South Korea) last quarter logged its highest-ever quarterly shortfall, losing $339 million on sales of $2.4 billion. The company issued a statement blaming its lackluster second-quarter performance on declining average selling prices across the TV, monitor and notebook segments, as well as lower-than-expected sales volume growth and fab overcapacity.

The company wasted no time taking action, shelving plans for a Generation 8 fab to produce large-screen flat-panel TVs. Instead, LG.Philips will invest in a multipurpose Generation 5.5 fab to serve the demand for high-end monitors and wide-notebook panels.

LG.Philips' main rival, Samsung Electronics Co. Ltd., thus far has not announced any scaling back of production. The company said last month it would likely post a single-digit second-quarter profit.

Taiwan's LCD panel industry is also hurting, according to industry newsletter WitsView, which reported a recent decline in the consolidated sales figures for the top five Taiwanese thin-film-transistor LCD suppliers. Keeping up with the tier-one suppliers could prove difficult for the smaller Taiwanese vendors, said iSuppli's Dash, who did not rule out supplier consolidation. In- deed, such contraction may already be under way; AU Optronics and Quanta will officially merge Oct. 1.

Rising panel inventories are having a ripple effect on materials. Corning Inc. said its second-quarter LCD glass sales would be flat to down 5 percent from the first quarter, though it expects LCD glass volume to be up 40 percent to 50 percent for the year. A DisplaySearch Inc. forecast pegs 2007 LCD production equipment revenue at more than $13 billion, but that figure doesn't factor in the fab delays.

Panel prices are projected to firm up as the holidays approach. Dash of iSuppli expects a 4 percent oversupply of large LCD panels this quarter but a tightening of supply toward year's end.

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Flat-panel price fall may help producers
17 July 2006

Sharp falls in flat-screen panel prices over the past few months owing to oversupply are hitting the earnings of the world's biggest producers of the devices.

South Korea's Samsung Electronics, the world's largest liquid crystal display maker, reported a 12 per cent fall in second-quarter operating profits on Friday compared with the first three months, partly owing to falling prices of thin film transistor LCDs.

LG Philips, the number two producer, reported its biggest loss in years in the second quarter, while Taiwan's AU Optronics, the third-ranking producer, is expected to file a lacklustre quarterly report tomorrow.

But analysts say the price slide could prove a blessing for the stronger producers, with retail prices falling to the point at which flat-screen televisions will become affordable to the global mass market.

This is seen as the level at which retail prices for flat screen TVs are double those of conventional sets using cathode-ray tubes - a moment manufacturers have been waiting a decade for.

"In terms of pricing, we are almost there," said Jeff Su, an analyst at Merrill Lynch in Taipei. Prices for 32-inch panels have fallen to below $400 (£218) in recent weeks. This would translate into a retail price of about $999 for an LCD TV.

If this level does turn out to be the tipping point, then the big flat-panel producers should be in for a strong end to the year. "We are looking at total shipments of 42.5m LCD TV sets worldwide this year, up 100 per cent from the 21m sets sold in 2005," said Henry Wang, chief executive of market research firm WitsView.

Mr Wang said there were compelling arguments for a strong surge in demand. "The two-times CRT crossover point is an experience from the [computer] monitor market," he said.

But while monitor sales were dominated by only a few brands, there are more than 50 makes jostling for position in the TV market, a situation that should lead to a more rapid decline in the retail prices of flat-screen TVs than occurred with monitors, he said.

So far, panel producers have been bearing the brunt of reducing the retail price. But "there is a lot of space to squeeze at the back end", said Mr Wang.

Indeed, while the pace of decline in TV panel prices is slowing, retail prices for LCD screens have started to fall faster.

The picture from the industry is mixed. Executives at LG Philips remain cautious, last week saying they would delay investment in their plants. Samsung, in contrast, was upbeat, predicting that panel prices would stabilise.

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Prices for 37-inch LCD TVs may fall below US$1,000 by year-end
2 August 2006

Prices for low-end 37-inch LCD TVs may fall below US$1,000 before year-end and the 37-inch segment will see its share rise significantly throughout the period, according to Hsiung Hui, executive vice president of AU Optronics (AUO), who spoke at a recent investors conference.

Prices for LCD TVs have not fallen at the same pace as that of LCD TV panels in the first half of this year since it takes around one quarter for the end product to reflect the price reduction at the panel end, Hsiung said.

Since end-user demand has not been adequately stimulated, TV panel prices have fallen significantly during the first half of this year, he indicated, adding that TV prices will now reflect the price trend.

For instance, prices for 37-inch panel prices dropped 8.0% from US$628 in June to US$578 in July while those for 37-inch LCD TVs only slid 2.3% from US$1,827 to US$1,785 during the period, according to Displaybank, a South Korea-based market research firm.

With prices for 37-inch LCD TVs set to fall faster during the rest of 2006, shipments of the segment will rise to account for 10-13% of the global LCD TV shipments in the second half of 2006, up from only 7-8% in the first half, Hsiung said.

With LCD TV demand still growing, the global LCD TV demand will still reach the expected 42-44 million units this year and the sales ratio for the first and second half of the year will be 35:65, Hsiung indicated.

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LCD TV to overtake PDP TV in 40-inch-range TV market by year-end
18 August 2006

The combined shares of 40- and 42-inch LCD TVs will exceed that for PDP (plasma display panel) TVs in the global 40- to 49-inch TV market by the fourth quarter of this year, according to Hsiung Hui, executive vice president of AU Optronics (AUO).

In the 40-inch-rage TV market, LCD TV gained ten percentage points to account for 32% of the market in the second quarter while PDP TV saw a five-percentage-point drop to 60% last quarter, according to DisplaySearch.

Price reduction is the driver for the change in the TV market. Prices for a 42-inch PDP TV used to be US$50 more expensive than that for a 40-inch LCD TV in June but became US$31 cheaper than that for a 40-inch LCD TV in July, WitsView Technology pointed out.

TV panel prices will also continue to drop, DisplaySearch said. The ASP (average selling price) for a 42-inch LCD TV panel is expected to drop 6-9% to US$680-700 in September sequentially, which is at a similar price level to that of a 42-inch HD (high-definition) PDP in August, the research firm added.

To stay competitive, PDP TV makers are moving their focus to the 50-inch PDP TV market. In the second quarter, the fast falling prices helped 50-inch PDP TV grew 40% sequentially in sales in the US market. The 50- to -59-inch range accounted for 35% of the total PDP TVs shipped in the US during the second quarter 2006, up from 30% in the first quarter, a report from Quixel Research showed.

In related news, thanks to better sales in the US market, Panasonic returned to the top position and left LG Electronics (LGE) in the second in the global PDP TV market with 23% of market share during the second quarter, according to DisplaySearch.

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Large LCD TV, PDP TV Advances to Second Round of Price Competition
20 September 2006



Large FPD TV Price Trends (Korean market)



LCD TV vs PDP TV Monthly Price Forecasts


▪ Large-size FPD TV prices are likely to continue on the decline for the time being: to 1.50 million won for a 42" PDP TV and 1.70 million won for 40" (42") LCD TV by June 2007.

▪ 42" HD PDP TV average consumer prices dropped below 2.00 million won (August 2006 and Korean market basis).

▪ The consumer price difference between 40" (42") LCD TVs and 42" PDP TVs is maintaining the level of 10%~20%.

▪ The price gap between 40" and 42" LCD TVs has almost vanished, diluting the trend towards size standardization. ~ 40" LCD TV and 42" LCD TV prices are likely to be positioned at a same price point on a brand basis.
Consumer prices for large-size FPD TVs have not stopped a falling trend. Some experts forecast that FPD TV prices will enter a stable phase after continuing on the decline over the past one or two years, but large-size LCD TV and PDP TV prices are still sliding. How long will the decline in consumer prices for FPD TVs be sustained? In its latest 'large-size FPD TV price trends analysis' report, Displaybank (CEO Peter Kwon), a market research firm, predicts that the price battle between large-size LCD TVs and PDP TVs in the 40-inch range, which is emerging as the biggest issue, will become more intense incrementally.

According to Displaybank's price change comparison of three FPD TV models introduced to the local market from July 2005, 40-inch and 42-inch LCD TV prices plunged, while the decline in 42-inch HD PDP TV prices is negligible, but continuing. Samsung's 40-inch LCD TV model prices were 2.20 million won ($2,308.02) in August 2006, and LG's 42-inch LCD TV model prices slumped to 2.09 million won ($2,192.61), outshining the gap between consumer prices. 40-inch range LCD and PDP TV price differentials also remained between 7% and 12%, narrowing from one or two years earlier. The average consumer price for 42-inch PDP TVs fell below 1.93 million won ($2,024.76), and that for 40-inch and 42-inch LCD TVs is also forecast to decrease below 2 million won ($2,098.20).

Will prices for large-size FPD TVs continue on a downward curve or maintain a stable trend? Displaybank's analysis data reveals that prices will continue to slide over the next six months to the year. Based on the prices for panels, which have the biggest impact on FPD TV prices, 40-inch range LCD and PDP panel prices will probably be on the decrease until the middle of 2007, accompanied by a downward trend in LCD TV and PDP TV prices.

The figure below presents 40-inch LCD TV, 42-inch LCD TV and 42-inch PDP TV price forecasts until June 2007. As seen in the figure, consumer prices are predicted to reach $1,430 for 42-inch PDP TVs, $1,715 for 40-inch LCD TVs and $1,715 for 42" LCD TVs in June 2007. If consumer prices for 40-inch range FPD TVs fall to the level of 1.4 million won ($1,468.74) to 1.7 million won ($1,783.47), demand for large-area FPD TVs may pick up explosively.

The fall in 40-inch and larger FPD TV prices has highlighted the expectations on full-scale demand growth. Notably, LCD panel vendors' strategy to lead the shift toward larger sizes has already brought a company to increase its proportion of 40-inch and larger size segment of its total LCD TV panels to 40% and more. In addition, the price gap between 40-inch and 42-inch LCD TVs has vanished, diluting companies' efforts in the size standardization race. Therefore, we foresee that 40-inch and 42-inch will firm up each own solid position in the market.

The essential task for 42-inch PDP TV makers is to become competitive in prices, in an effort to sustain its upper position in competition with LCD TVs. Around June 2007, when the consumer price for a 40-inch HD PDP TV will reach 1.5 million won ($1,573.65), 40-inch range FPD TVs are highly likely to emerge as the mainstay; hence, the retention of price competition through mass production is another challenge to LCD and PDP panel manufacturers and the overall display industry. It seems to be so fat from now that all households in the middle class will purchase 40-inch range FPD TVs of the large-size segment, which is increasingly attracting to consumers.

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LCD cheaper than PDP in 40-44-inch HDTV market in N. America
22 September 2006

The average street prices for 40-44-inch LCD TVs and business displays in North America dropped below those for high-definition (HD) plasma panel display (PDP) TVs of the same size range for the first time in July, according to research firm Pacific Media Associates (PMA).

Not long ago, this size range was dominated by PDP TVs because LCD models cost much more in the range. As LCDs now cost less on average, their share of sales is growing rapidly. In July, LCDs in this size range gained four percentage points to 46% of the market. This trend is likely to continue, pushing PDP TV to dominate the 50-inch range flat-panel TV market.

"We've seen this repeatedly in the past," according to Rosemary Abowd, vice president of PMA. "When the price of LCDs match or drop below the prices for HD PDP TV of the same size, LCDs win, Abowd said, adding that PMA expect LCDs will account for the majority of unit sales in the 40- to 44-inch range TV market soon.

Across all flat-panel TVs of 30 inches or larger, LCDs gained another three percentage points to 57% of the market in July.

Unit sales for flat-panel TVs were down 10% sequentially in July, which is similar to the summer slowdown seen in previous years. However, the segment had a 67% on year increase. Sales are expected to increase again, as the football season and holiday buying season arrive.

Competition for the top spot in unit sales is heated; Sony's 20.3% share was just one percentage point ahead of the second place claimed by Panasonic, and Samsung was a close third. The Pioneer PRO-1130HD 50-inch HD PDP TV remained the top on the best-seller list for the second month in a row, PMA stated.

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Prices for 40-inch LCD TVs fall below US$2,000 in N. America
29 September 2006

Prices for 40-inch LCD TVs in North America declined 7.68% sequentially to US$1,983 in September, the first time below US$2,000, while those for 42-inch one only dropped 1% on month to US$2,149, according to today's Chinese-language Apple Daily, quoting research firm Displaybank.

With the significant price drop for 40-inch LCD TVs, the price gap between the 40-and 42-inch segments has reached US$166, compared to than US$25 in July and August, the paper cited the research firm as saying.

Prices for 40-inch LCD TVs in Japan and South Korea will also fall below US$2,000 in the fourth quarter, said Displaybank, as cited by the paper.

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Price war for 40-inch LCD TVs intensifies in N. America
3 October 2006

Brand LCD-TV makers are offering more aggressive prices for their products in North America amid a traditionally strong season and support from panel makers, with prices for 40- and 42-inch models competing more fiercely than before.

Prices for Philips-branded 42-inch LCD TVs have dropped to US$1,699 at Costco's website, while LG Electronics (LGE) is promoting its 42-inch LCD TVs at US$1,999 at BestBuy.

Samsung Electronics is promoting its 40-inch models at US$1,799 at BestBuy, while Sony's Bravia-branded 40-inch models are priced at US$1,899 on Costco's website.

The ASPs (average selling prices) of 40- and 42-inch LCD TVs were US$1,899 and US$2,137, respectively, in the second half of September, according to market-research firm WitsView Technology.

Philips has support from LG.Philips LCD and AU Optronics (AUO), while Chi Mei Optoelectronics (CMO) has also significantly grown its 42-inch panel shipments. As such, LCD-TV vendors for the 40-inch segment, led by Sony and Samsung, are facing much more pressure than before and have continued to lower prices for the segment in North America.

The output of 42-inch panels used to fall behind that of 40-inch panels, prior to the second quarter of 2006, with the North America LCD-TV market dominated by the 40-inch segment, according to Taiwan-based LCD-TV makers.

Slightly more than 10,000 42-inch LCD TVs were sold in North America in the second quarter, compared to more than 100,000 units from the 40-inch segment in the same period, the makers indicated.

However, companies such as Royal Philips Electronics are promoting 42-inch LCD TVs with more aggressive pricing in retail chain stores in North America, as AUO and CMO are increasing their 42-inch panel shipments.

In addition, after AUO and CMO increase their production of 42-inch panels in the fourth quarter, the 42-inch LCD-TV segment will put pressure on the 40-inch segment, which won the battle with the 42-inch segment in the North America market in the first half of 2006, sources recently indicated.

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Big-TV Battle: LCD vs. Plasma
4 October 2006

Dropping prices on large-screen sets mean viewing pleasure for consumers who buy earlyand thin margins for manufacturers.

The battlefield? Your local consumer electronics retailer. The combatants? The companies that manufacture LCD and plasma screen TVs. The stakes? Bragging rights, maybebecause at least in the near term, there aren't going to be many profits.

"CATCHING UP." "The only ones making money in the TV business this year will be the guys who deliver the sets and the people who sell the stands and the mounting brackets," says analyst Rosemary Abowd of Pacific Media Associates in Menlo Park, Calif.

The imminent price war will pit so-called liquid-crystal display (LCD) screens against plasma screens, with consumers reaping the primary benefit. For the first time, LCD TVs in sizes above 40 inches are priced competitively and in some cases far lower than plasma screens in the same size. And sales volume for both types is expected to surge this year. That augurs a market where buyers will have a lot of choice and vendors race to undercut each other.

"It used to be that the market above 40 inches was a safe haven for the plasma business, but now the LCD guys are catching up and can compete at those sizes," says Paul Semenza, analyst at market research firm iSuppli in San Jose, Calif. "Before this, the LCD companies couldn't make their screens efficiently enough."

SALES SURGE PREDICTED. Why the progress? Think of it as Moore's Law turned on its head. Computer chips become progressively smaller or more powerful over time. But, in the case of LCDs, it gets cheaper to make them bigger. LCD manufacturers have reached a point where they can create six or more large screens from a single piece of glass. "Once you get going, the marginal cost of making each glass panel for an LCD screen falls a lot faster than it does for a plasma screen," says Semenza.

The upshot: a land grab that draws in players across Asia, from South Korea's Samsung and LG.Phillips, a joint venture of South Korea's LG Electronics and Dutch electronics giant Philips (PHG), to Sharp and Sony (SNE) of Japan, to Taiwanese players such as AU Optronics and Chi Mei Optronics.

Semenza says iSuppli is forecasting huge growth for both types of TV sets by the end of the year. Sales of LCD sets of all sizes should grow from 20 million units last year to 38 million this year. Plasma sets, meanwhile will grow at a comparable clip, from 5.2 million units last year to 8.6 million this year.

INVENTORY SQUEEZE. With the market growing so fast, aggressive price cutting is the word of the day, Abowd says. "We're seeing sets in the stores in the 37- to 42-inch range priced well below $2,000," she says. "And I'm seeing 37-inch SyntaxBrillian (BRLC) screens for less than $1,000. This means there's not a lot of margin anywhere for anyone."

The average street price for a screen in the 30- to 34-inch range that sold for $1,161 in August, will drop to $1,050 by December, while the price for screens in the 40- to 44-inch range will drop a little more slowly, from $2,087 in August to $1,900 in December, Abowd says.

And while all this price cutting is generally good for consumers, it has its downside, too, she says. "For the past three years, as we've watched the market leading up to the holiday season, we've seen prices start to go up in late October and into November and December," she says. "There's certainly going to be some inventory constraints, and they'll be on the cheapest sets." Translation: If a big LCD or plasma screen is on your Christmas list, buy it early, or be prepared to rewrite your wish list.

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Large TFT-LCD Panel Price Trends for August 2006
10 October 2006




With all indicators of the large-size TFT-LCD panel market found by Displaybank for August, telling of positive growth, the market became robust for the first time this year. The average selling price, which had posted negative growth, was also up 2% to $175. This upward trend contributed to the upsurge of 18.1% in revenues to $4.54 billion, according to Displaybank (CEO Peter Kwon), a market research firm.

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Commentary: Market for 42-inch LCD TV ready to boom
12 October 2006

With prices for 42-inch LCD TVs fallen below that for a 40-inch LCD TVs in the beginning of October, shipments of 42-inch LCD TVs are expected to pick up significantly throughout the year-end.

Quotes for Philips-branded 42-inch LCD TVs have dropped to US$1,699 at Costco's website at the beginning of this month, while LG Electronics (LGE) is promoting its 42-inch models at US$1,999 at BestBuy. Meanwhile, Samsung Electronics is promoting its 40-inch models at US$1,799 at BestBuy, while Sony's Bravia-branded 40-inch models are priced at US$1,899 on Costco's website.

S-LCD enjoys price advantage due to earlier operation

Samsung and Sony are both betting on the 40-inch LCD TV segment. Their joint venture, S-LCD, began volume production at the world's first seventh-generation (7G) plant in April 2005. Around 70-80% of the 40-inch panels produced at S-LCD's 7G line are shipped to Samsung and Sony.

LG.Philips LCD's 7.5 generation (7.5G) plant did not started volume production until January 2006, nearly eight months behind S-LCD. As a result, prices for 42-inch panels, the major product for LG.Philips LCD's 7.5G plant, were higher than those for 40-inch panels, mainly pushed by Sony and Samsung.

The ASP (average selling price) for 42-inch LCD panels was US$1,100 at the beginning of this year, US$170 higher than that for 40-inch LCD panels, according to research firm WitsView Technology.

Prices for 42-inch LCD TVs from LGE, a major customer of LG.Philips LCD, were US$1,000 more than Sony's 40-inch S-series model in the first half of 2006. With a less well-know brand and a significant higher price point than 40-inch LCD TVs, the sales of 42-inch LCD TVs were not as strong as expected in the first half, which caused a high inventory level of 42-inch panels at LG.Philips LCD in the second quarter of 2006.

LG.Philips LCD slashed 42-inch panel prices in 3Q

The price gap between 42- and 40-inch LCD TVs has caused a shipment slowdown and inventory pileup for the 42-inch panels from LG.Philips LCD. The inventory turnover levels at the maker reached 42 days in the second quarter of 2006, up from 35 in the first quarter.

Samsung, in comparison, said its inventory turnover days were only seven days in the second quarter thanks mainly to strong shipments LCD TVs of both Samsung's own brand and Sony's Bravia series.

To reduce its inventory, LG.Philips LCD has been aggressively cutting prices of its 42-inch panels in the third quarter. Prices for the segment fell to US$700 in September, down from US$800 in July, and the price gap from 40-inch panels have narrowed to US$10. Prices of the 42-inch segment are likely to further drop to US$650 in the fourth quarter.

Sharp price drop of 42-inch LCD TVs

The aggressive price-cutting strategy from LGE and Royal Philips Electronics, the two major vendors pushing 42-inch LCD TVs, have helped the 42-inch segment gain share in the large-size LCD TV market.

In North America, 42-inch LCD TV is now catching up with the 40-inch segment. According to a survey by NPD, sales volume of 40-inch LCD TVs dropped 15% on month to 26,500 units in July in North America, compared to a 14% sequential growth to 3,860 units for the 42-inch segment.

In August, the sales volume of 42-inch LCD TVs rocketed 67% on month while 40-inch LCD TVs only saw a 1% sequential growth, according the research firm.

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N. America market: Flat-panel TV sales jumped 19% in August, prices continued to drop
20 October 2006

Unit sales for flat-panel TVs and business displays in North America rose 19% sequentially in August, according to Pacific Media Associates (PMA). The ASP (average selling price) fell another 6% sequentially and 27% on year in August, the research firm noted.

"The upswing in August sales was a familiar event," according to Rosemary Abowd, vice president of PMA. "We've seen similar increases in late summer for the past three years," she said. "We saw continued aggressive price strategies in August," said Abowd. The ASP for the 35- to 39-inch 1080p LCD segment dropped more than 19% in August, dropping below US$2,000 for the first time, Abowd added.

The preference for LCD over PDP (plasma display panel) TV is moving to larger models. LCD models now account for 60% of all flat-panel TV sales. In the 40- to 44-inch segment, lower prices helped increase LCD's share to nearly half of the market at that size, with a 49% unit share.

Panasonic took the top place for unit share across all markets, but Sony had an edge in the consumer segment, edging out Panasonic 21.2% to 20.9%. The best-selling consumer model in August was the Panasonic 42-inch PDP TV (TH-42PX60U), according to PMA.

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LCD monitor panel ASP stabilizes in 2HOct, TV panel prices continue to drop
23 October 2006

The ASP (average selling price) for LCD monitor panels remained flat in the second half of October, while large-size LCD TV panel prices are dropping slightly, according to research firm WitsView Technology. Prices for notebook applications were up slightly, the research firm noted.

Prices for 17-inch, 19-inch and 19-inch widescreen LCD monitor panels stood at US$130, US$150, and US$143, respectively in the second half of this month.

The ASP for 32-inch LCD TV panels also remained flat during the period at US$365, the research firm pointed out. However, the price for 42-inch TV panel fell US$10 to US$680 while the ASP for 40-inch LCD TV panels decreased US$5 to US$680, leveling out prices for the two segments, WitsView added. The prices for 37-inch TV panels also dropped US$5 to US$530 in the second half of October.

Prices for LCD monitor panels are expected to rise US$3-5 sequentially in November, sources indicated, adding that the 32-inch TV panel segment will remain flat next month while 37-, 40- and 42-inch TV panels will continue falling.

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LG.Philips LCD slashing 42-inch panel prices, report says
23 October 2006

To better compete against Samsung Electronics, LG.Philips LCD has slashed prices for its 42-inch LCD panels to more than US$10 lower than that of Samsung's 40-inch panels and US$200 lower than its costs for the segment, the Chinese-language Apple Daily quoting industry sources in saying.

The ASP (average selling price) for 40-inch and 42-inch panels stood at US$680 in the second half of October, according to WitsView Technology.

LG.Philips LCD will also slash prices for its 37-, 42- and 47-inch panels in November, the paper said, adding that Dell will switch some orders over to the South-Korean maker next month as long as prices are not raised, while Hewlett-Packard (HP) may follow suit.

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LCD to beat PDP in 40-inch-and-larger panels in 4Q, DisplaySearch says
31 October 2006

LCD TV panel shipments were larger than PDP shipments at the 37-inch-and-above segment for the first time in the third quarter of 2006 and are poised to overtake PDPs at the 40-inch-and-larger segment as early as the fourth quarter, according to research firm DisplaySearch.

Shipments for 40- to 47-inch LCD TV panels have risen 560% sequentially to 2.4 million units, taking significant share from PDPs as 720p prices approach parity while 1080p LCDs offer increased differentiation. Supporting LCDs is massive growth in 40-inch-and-larger optimized capacity with seventh-generation (7G)-and-above capacity and a number of major brands shifting their 42inch emphasis from PDP to LCD.

PDP (plasma display panel) shipments rose 17% sequentially and 47% on year in the third quarter of 2006 to a record 2.8 million units, according to DisplaySearch. PDP revenues also earned a record high in the third-quarter, rising 10% sequentially and 29% on year to US$2.02 billion, the first time that PDP revenues exceeded US$2 billion, the research firm added.

However, PDP average selling prices (ASPs) were down 6% sequentially and 12% on year to US$724, DisplaySearch indicated.

Despite the record results and seemingly healthy growth, the third-quarter growth was significantly slower than any other quarter to date with on-year growth over the past 12 quarters ranging between 73% and 170%, according to the research firm. PDP suppliers are expecting even slower growth in the fourth quarter, up 20% on year to 3.2 million units. Assuming PDP suppliers hit their fourth-quarter targets, PDP shipments will rise 49% on year in 2006 to 10.7 million units, which is less than half the growth of previous years.

There are a number of reasons for the slower growth in shipments. Migration to larger sizes is reducing the number of panels that can be produced per substrate. The share of the 50-inch-and-larger segment of worldwide PDP shipments has doubled from 12% in the third quarter of 2005 to 24% in the third quarter this year. Capacity growth will be just 46% in 2006, compared with 92% in 2004 and 66% in 2005. The slower capacity growth has resulted in tighter supply, which in turn has reduced pricing pressure and impacted demand. Increased competition from LCD TVs below 50-inch has also contributed to the slower PDP growth.

High-definition TV (HDTV) formats continued to drive PDP shipments, with the HD share rising from 73% in the second quarter to 79% in the third quarter on a 28% growth. The share is expected to reach 86% in the fourth quarter on a 23% growth.

Shipments of 1080p PDPs also surged in the third quarter, rising 183% sequentially to 21,000 units. In the fourth quarter, 1080p panels are expected to rise 78% to 38,000 units.

By supplier, LG Electronics (LGE) led on a unit basis on 27% growth to overtake Matsushita. On the other hand, Matsushita led on a revenue basis for the third time over the last four quarters due to its emphasis on higher resolutions.

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Trick or Treat-LCD is on PDP's Doorstep
31 October 2006

The long-awaited nightmare of PDP managers has arrived - and it was announced on Halloween. DisplaySearch said today that for the first time, LCD-TV panel shipments exceeded PDP shipments in the 37-inch-and-above segment in Q3′06.

Not that PDP had a bad Q3, mind you. 2.8M units shipped and revenue was at a record high, up 10% sequentially and almost 30% year-on-year, passing the $2B mark for the first time ever, according to DisplaySearch. But all this wasn't enough to stop the LCD juggernaut fueled by super capacity Gen 7, Gen 7.5 and Gen 8 fabs pumping out large displays in unprecedented quantities that kept the price pressure in high-gear over the quarter and pumped up flat panel demand across the industry.

In fact, the double-digit (17%) sequential growth numbers in PDP sales look anemic by comparison to large LCD panels, which topped the mid-triple digits at a whopping 560% sequential growth in the 40- to 47-inch panel size.

Scratch the surface a bit and you'll find the devil in the details. While revenue is up, PDP's unit growth is actually slowing, partly because of the shift toward production of larger (+50-inch) panels. This defensive move is in answer to rival LCD's 1080p, full-HD push and helps explain LCDs success in the +37-inch category, where PDPs cannot compete on pixel (cell) density.

For PDP makers, the trade-off to building larger panels is reduced unit output as fewer larger panels can be produced per plasma substrate. This is reflected in the Q3 numbers. Third-quarter PDP unit growth was actually the lowest in the past 12 quarters, which saw sequential growth range between 70 to 170%.

It makes sense. Larger PDP panels are selling for more, but in lower quantities. In fact, +50 inch PDP panel output doubled in the past year from 12% to 24%. But unlike LCDs, which are being made in record numbers, PDP's shift to larger panel sizes has resulted in reduced PDP output, which, in turn, lowered supply pressure on prices. What was a PDP price gap with LCD is narrowing. As prices for large LCD panels dropped to relative parity with PDP in the same size range, consumers opted for the higher-resolution LCD models, in part stimulated by the mantra of full-HD.

Here's our take: Matsushita, LGE and Samsung SDI have invested heavily in ramping production to compete with LCD in the large-display space. Plasma owned the large flat-panel market for many years, but it did this without effective competition. Remember, plasma had no flat-panel competition until the recent development of Gen 6 LCD fabs.

So, adding insult to injury, the display gods picked Halloween as the last day LCD could claim to king of the big-display hill in the 40-to-49-inch segment. Is this as frightening to PDP planners as a cackling witch on Halloween? Actually, no. People in the industry have seen this coming for months, and PDP demand is projected to grow for years to come. But if anyone is just a little nervous, they, like tonight's Halloween pranksters, will be able to take off their costumes and masks by tomorrow, and the event will fade with few real consequences on their - or our - daily lives.

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Display Daily: Plasma's Shrinking Base
10 November 2006

The flat-panel television (FP-TV) market has been undergoing dramatic transformation, which is now coming to light in recently released market- research findings for 3Q'06. These figures show that LCD-TV will replace not only CRT televisions of under 40 inches but may also overtake plasma shipments of 40-50 inches in diagonal.

Insight Media AnalystIn 3Q'06, LCD-TV comprised almost one quarter (24%) of televisions shipped worldwide, up from 22% in 2Q'06, according to DisplaySearch. The number of units shipped increased by 99% from the same quarter last year.

The average LCD-TV size is also growing. The average LCD-TV diagonal stood at 29 inches in the third quarter. The 15% increase in LCD-TV average size offset price declines, allowing LCD-TV revenues to increase by almost as much (84%) as shipment growth over the same period last year. LCD-TV's 3Q'06 revenues were $11.9B, representing almost 50% of the global television market.

DisplaySearch reported that LCD-TV shipments even surpassed those of CRTs for the first time in Europe. A report from LCD-TV panel manufacturer LG.Philips LCD also forecasts that worldwide LCD-TV revenues will also overtake those of CRTs for the first time in 2006.

The plasma-television industry has been responding with price reductions that matched shipment increases in 3Q'06. PDP-TV average selling prices were down 18% while revenues were up 18% versus the same period last year.

PDP-TV manufacturers have increasingly had to rely on a single region - North America - to maintain dominance in key segments. As PDP-TV becomes a low-cost, big-screen technology, North American buyers, who typically respond to low prices for larger diagonals, have begun to lead the world in plasma consumption.

However, only North America saw an increase in 3Q'06 plasma shipments over 2Q'06. Since North America was the only region with a sequential unit increase, it accounted for the entire 4% global increase in PDP-TV quarterly shipments. Moreover, 70% of plasma shipments in 50+ sizes were to the North American market.

The reason for this switch from plasma in regions outside North America, according to DisplaySearch, is the increasing competitiveness of 37-46-inch LCD-TV. LCD-TV shipments of 37 inches and larger overtook those of PDP-TV in most regions for the first time in 3Q'06.

DisplaySearch predicts that the 38% sequential increase in plasma shipments to North America will result in exploding channel inventory levels and drastically reduced prices during the 2006 holiday shopping season. Two weeks from today, on Black Friday, expect prices at North American retailers to fall below $1000 and $2000 for many 42- and 50-inch PDP-TV models, respectively.

Because falling plasma prices in one region are a result of incursions by LCD-TV worldwide, the bump in plasma demand is not expected to last. Plasma manufacturers will increasingly rely on larger sizes to maintain share. The only problem with this strategy is that the very largest televisions are the domain of MDTVs, which have absolute pricing advantages at 60+ sizes. Advances by LCD-TVs into plasma's mainstream 40-49″ segment is pushing PDP-TV manufacturers onto a precariously narrow base.

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Corning sees LCD glass pricing declining in Q4
13 November 2006

Nov 13 (Reuters) - Specialty glass maker Corning Inc. (GLW.N: Quote, Profile, Research) said it expects LCD glass pricing to decline again in the fourth quarter and reiterated its outlook for the period.

The company said it expects the LCD glass market to grow by about 50 percent this year and sees strong volume growth in 2007. (Reporting by Saumyadeb Chakrabarty in Bangalore)

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Prices for 42-inch LCD TV panels drop to nearly US$600
15 November 2006

Prices for some 42-inch LCD TV panels have dropped US$25 to nearly US$600 in the first half of November, with those for 32-, 37-, and 42-inch LCD TV panels decrease significantly during the period, according to unspecified executives at Taiwan-based home appliance makers and IT makers, as quoted by the Chinese-language Commercial Times.

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US market: Large-size LCD TV sales continue to blossom in 3Q, says Quixel Research
15 November 2006




Over half of the LCD TV unit and revenue sales in the US market were of the screen sizes above 30 inches during the third quarter of 2006, according to Quixel Research.

In unit market share, the 30-inch-and-above segment captured 52% of the LCD TV category last quarter or doubled its share on year. Sales wise, the segment took 75% of the revenues for the overall LCD TV category and reached US$2.3 billion, up from US$729 million in the third quarter of 2005.

LCD TVs of 40 inches and above showed the strongest growth. Prices continued to fall dramatically in these sizes and consumers also had the flexibility to future proof their purchase with a 1080p selection, comments Tamaryn Pratt, Quixel's principal. Price declines also supported the strong growth in the 37-inch LCD TV segment, which increased 75% sequentially during the period.

Overall, the total LCD TV revenues topped the US$3 billion mark in the third quarter, with sales increasing 35% sequentially and 120% on year. Volumes were also up significantly sequentially and on year and grew 33% and 122%, respectively, for the LCD TV category.

The total value of the advanced TV market in the US was almost US$7 billion in the third quarter and the LCD TV segment represented over 45% of that market. Quixel expects the US LCD TV market to quadruple in sales by 2009.

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Material costs for LCD lower than PDP in 40-inch class panels in 4Q, Displaybank says
16 November 2006






Material costs for 40-inch class LCD panels have fallen below than that for PDP (plasma display panels) of the same class in the fourth quarter of 2006, according to the latest report from Displaybank.

Total material costs for 40-inch class LCD panels has dropped to US$617 in the fourth quarter, down nearly 30% from US$874 during the same period in 2005. Cost for PDPs at the same size fell to US$631 this quarter, down 21% from cost of US$800 in the fourth quarter of 2005, Displaybank said.

Although both LCD and PDP makers are striving for lowering production costs, prices for major component for LCD panels such as glass substrate, backlight units (BLUs) are falling faster than those for PDP, the research firm explained.

In addition, shipments of 40-inch range LCD panels are catching up with rival PDPs, according to panel makers. In September, shipments for 40-inch class PDPs totaled 1.07 million units, with shipments from Matsushita Electric Industrial and LG Electronics (LGE) at about 370,000 units and 350,000 units, respectively. Samsung SDI only shipped about 230,000 units in September amid slow expansion, the makers added.

Total 40-inch class panel shipments from LCD panel makers totaled about 1.06 million units during September, with monthly shipments of 40- and 46-inch segments from Samsung Electronics reaching 600,000 units, said panel makers. As panel makers such as Samsung are continue expanding their capacity in October, shipments of LCD TV panels in the 40-inch class are likely to exceed that from PDPs, LCD panel makers estimated.

As LCD technology is moving to larger-sizes TV market, PDP makers plan to push the 50-inch range segments or even 60-inch range to counter the rival LCD technology, according to PDP TV makers. DisplaySearch earlier also indicated that the 50-inch range TVs will become the new divide between the LCD and PDP TV segments, as opposed to the previous divide at the 40-inch mark, since LCD panel makers are accelerating their deployment at next-generation fabs .

In July, the average street prices for 40-44-inch LCD TVs and business displays in North America dropped below those for high-definition (HD) PDP TVs of the same size range for the first time, Pacific Media Associates (PMA) said in September.

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Shift to finer, larger TVs favours LCD over plasma
27 November 2006

By Kiyoshi Takenaka

TAIPEI, Nov 27 (Reuters) - Plasma TV suppliers such as Panasonic maker Matsushita Electric (6752.T: Quote, NEWS, Research), already outnumbered by the rival LCD camp, are expected to lose further ground as LCD TVs encroach on the 40-inch-class market, a plasma stronghold.

Growing demand for higher-resolution models is also giving a leg up to liquid crystal display (LCD) TVs, promoted by Sony Corp. (6758.T: Quote, NEWS, Research) and many others in Taiwan and South Korea, paving the way for consolidation among plasma companies, analysts say.

It is technologically difficult and often costly for plasma makers to give a full high-definition function to models with a screen size of less than 50 inches, while LCD TV makers are aggressively promoting full HD models in that segment although prices are generally higher.

"This Christmas season probably is the last chance for (plasma TV makers) to promote 42-inch models. By this time next year probably there will be no price difference between plasma and LCD TVs," Credit Suisse analyst Wanli Wang said.

With little price difference, most people would choose LCD TVs because of their higher resolution, Wang said.

He expects LCD TV prices to fall 30 percent or more in 2007, compared with a decline of 15 to 20 percent for plasma TVs, due to ample LCD panel supplies.

Sharp Corp. (6753.T: Quote, NEWS, Research) in August started LCD production at its Kameyama No. 2 plant, the world's first to cut panels from eighth-generation glass substrates, which can yield eight 40-inch-class panels, compared with just three panels from the sixth-generation glass used at its first Kameyama plant.

DisplaySearch forecasts that the plasma TV market will start shrinking in 2009 after hitting $24 billion in 2008, while it sees LCD TV demand reaching $75 billion in 2008 and $93 billion in 2010 - a trend that will likely make companies offering both LCD and plasma lines think twice about their strategy.

Taiwan's Chunghwa Picture Tubes (CPT) (2475.TW: Quote, Profile, Research) is one such company. It shut down its plasma panel business this year to concentrate on LCDs.

"We cannot focus on two different products because of heavy capex (capital expenditure). That's why we had to choose one," CPT Chief Financial Officer James Wu said.

South Korea's Samsung Electronics Co. Ltd. (005930.KS: Quote, Profile, Research) and LG Electronics Inc. (066570.KS: Quote, Profile, Research) as well as Japan's Hitachi Ltd. (6501.T: Quote, NEWS, Research) offer both LCD and plasma TVs. Matsushita also sells both products, although it heavily bets on plasma.

"The larger panels become, the more important response speeds for moving images are. In this point, plasma still excels," Matsushita President Fumio Ohtsubo told reporters last month.

CPT's Wu agrees that plasma panels, especially 50-inch and larger ones, do excel LCDs in some aspects of picture quality, but he says the sheer size of the LCD camp will help LCD panels overcome whatever drawbacks they have in a timely manner.

"Globally, so many companies, so many investments, so many people have been working in this area, on this product. So they can improve so quickly," Wu said.

About 80 percent of global flat screen R&D spending is being allocated to LCD panels, and the remaining 20 percent to plasma and some other technologies, Credit Suisse's Wang said.

In a potential sign of slowing plasma TV demand, Japan's top three plasma TV makers -- Matsushita, Hitachi and Pioneer Corp. (6773.T: Quote, NEWS, Research) -- last month cut their unit sales forecasts by 8 to 20 percent for the year to March.

With the 40-inch-class market gradually taken over by LCD TVs, plasma models need to migrate to the market for 50-inch TVs and above, but demand is not as well developed there, analysts say.

"The United States accounts for more than 70 percent of demand for 50-inch plasma TVs and larger. In other words, there is virtually no 50-inch-class plasma TV market outside the United States," DisplaySearch director Hisakazu Torii said.

Although demand is limited, competition is not necessarily mild. Instead of LCD models, plasma TVs will be pitting themselves against another strong rival, rear-projection TVs.

"If you take a long-term view on the plasma industry, prices are coming down and revenue will not be growing that much. That makes aggressive investments for future growth difficult," iSuppli Japan director Junzo Masuda said.

"The number of players will likely be getting smaller and smaller," he said.

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Make room for the 70-inch LCD TV: Bernstein
28 November 2006

NEW YORK (Reuters) - Move out that old armoire and clear off the living room wall -- it will soon be time to make room for that new 70-inch LCD television.

With 42-inch flat-panel TVs flying off retailers' shelves this holiday season as prices dip below $1,000, brokerage house Sanford C. Bernstein said in a research note on Tuesday that 70-inch TVs could be the "right size" in 2009.

"We decided to investigate the optimal screen size for high definition viewing," wrote analyst Jeff Evenson in the note. "We conclude that 65 inch to 75 inch is the right size for a 10 foot viewing distance."

Evenson said LCD televisions are free of three barriers that limited the size of traditional TV screens -- weight, thickness and cost -- meaning large-sized LCDs could become more prevalent in homes.

While a 34-inch bulky tube TV could weigh roughly 200 pounds, Evenson said a 57-inch flat-panel LCD TV weighs only 125 pounds, making it more manageable.

An LCD TV is also not inhibited by a thickness that increases dramatically as the TV gets larger -- like it does with a tube TV.

"We believe that a TV's depth creates a barrier to purchase in two ways: it decreases the effect distance viewers sit from the screen and thicker screens can not fit through small doorways and tight turns," he said.

If a tube TV was made as large as the larger LCDs, he said its depth without the shipping box would approach the width of some apartment doors -- making them impossible to get inside.

Lastly, he said the cost of larger LCDs should continue to decrease, spurring their popularity.

"Affordability of large screens has and should continue to improve," Evenson wrote. "Our analysis indicates that 70 inch - 80 inch screens could cost around $3,000 in 2010."

With Samsung Corp (000830.KS: Quote, Profile, Research) expected to ramp 70 inch production and AU Optronics (2409.TW: Quote, Profile, Research) expected to ramp up 65 inch production in early 2007, he said TV size growth seems unlikely to slow.

This could be good news for Corning Inc. (GLW.N: Quote, Profile, Research), which manufactures glass substrates used in large flat-screen TVs.

"We believe the long-term valuation of Corning depends largely on demand for LCD substrate glass," he wrote. "We expect that LCD TV adoption will exceed consensus and that increasing screen diagonals ... will compound the substrate demand growth rates."

Bernstein has an "outperform" rating on Corning shares and a $28 price target.

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ASP for large-size LCD panels fall again in 1H December, says WitsView
6 December 2006

Mainstream notebook panel prices began to drop in the first half of December after its surge since late August. Meanwhile, as seasonal demand came to an end, mainstream monitor panel prices continued to decline by around 2%. Likewise, large-size TV panel prices had a 2-3% decrease, as Christmas demand had been fulfilled, according to WitsView Technology.

Monitor price panel update

Seasonal demand for monitor panels began to turn weak late November; hence, mainstream monitor panel prices kept falling by around US$2-3. As system integrators came in the market with strategic purchase earlier in the second quarter of this year when the price was at the bottom, they felt comfy and unnecessary to pull in more panels at this moment since they still have sufficient stock at hand to meet the demand.

On the other hand, coupled with vendors' proper utilization rate adjustment in the second quarter and inventory depletion from seasonal demand in the third quarter, TFT LCD manufacturers also found a relatively low inventory on hand. As result, mainstream monitor panel prices dropped slightly in the first half of December.

TV panel price update

As Christmas purchase on LCD TV panels came to an end, demand from TV panels also turned weak. The average selling price (ASP) of larger-size TV panels dropped the most while that of those smaller-than-32-inch were relatively stable. In the first half of December, prices of 40- and 42-inch LCD TV panels both dropped US$20 to US$620 and US$640, respectively. At the 30-inch class, unlike 32-inch, 37-inch incurred a larger price cut in the third quarter. With the continuous price decline and the shrinking price gap with 32-inch, the ASP of 37-inch panels declined slightly by US$5 to US$515.

Notebook panel price update

After the three-month uptrend, notebook panel prices finally peaked and began to turn around starting from this December. Compared with the previous uptrend, which boosted mainstream notebook panel prices by nearly 30% during a five-month period, the recent price increase only pushed the price by around 10%, suggesting a weaker-than-expected seasonal demand.

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LCD Prices Continue to Tumble
14 December 2006

Last week in San Francisco, Sony Electronics president Stan Glasgow met with reporters and whined about the continuing price reductions for LCD-TVs, now predicted to be 25 to 30% over the next year. That's 5 to 7 percentage points more than Sony had anticipated, Glasgow said.

Several things are fueling the price reductions, and a big one is reductions in the manufacturing cost of the LCD panel that is the major component in an LCD-TV. Buy a name-brand LCD-TV set at a major retailer, and the price of the set will be about three times what the set-maker paid for the panel. Buy a second-tier brand TV at Costco and the set price may only be a bit more than twice the cost of the panel.

It is no secret that panel production cost goes down when panels are made on larger pieces of mother glass, so more panels can be made at one time. As more and more Gen 7, Gen 7.5 and Gen 8 plans come on line, manufacturing cost goes down. This week, Taiwan's CMO successfully lit up the first 42-inch panel made on its new Gen 7.5 line.

Panel manufacturers are also aggressively reducing the cost of the key components that go into their panels. The most expensive component is the backlight unit (BLU). One short-term approach to reducing the manufacturing cost of the BLU is to use external electrode fluorescent lamps (EEFLs) instead of the conventional cold-cathode fluorescent lamps (CCFLs). The lamps aren't much cheaper, but they allow the BLU maker to use fewer inverters - the power supplies for the lamps - and that saves money. Significant EEFL use just started during the past year, and it will be increasing this year.

The matrix color filter (MCF) is another expensive key component. After years of development, it has now become possible to make MCFs with ink-jet printing instead of photolithographic techniques. Sharp has just announced a new Full HD, 32-inch LCD TV that uses an ink-jet color filter. (That's two new SKUs, depending on whether the speakers are mounted on the bottom or the sides.) The focus of this set is high resolution (for a 32-inch) and enhanced contrast (2000:1) thanks to the color filter, not lower cost. But once ink-jet color-filter production ramps up, its cost-reduction potential will surely be seen in reduced panel ASPs.

Of course, low panel cost doesn't have to mean lower prices: it could mean higher margins. But the industry is so competitive and the new fabs make it necessary to move so much product, that it would take a lot of courage for any one company to build much more margin into its selling price than its competitors - unless that company has relatively long-term commitments from customers (as Samsung does).

Another reason for keeping margins low is that plasma display technology is - after some startling price cuts - generally a bit cheaper at 42 inches than LCDs and substantially cheaper at 50 inches. Some plasma executives are hinting at further significant price cuts in 2007. LCD has to watch its back.

So what does all this mean in terms of current and near-term pricing? The Chinese-language Commercial Times reported yesterday that LG.Philips LCD (LPL) is currently quoting a price of $500 for its 37-inch LCD panels, with the possibility of further reductions of $10 to $15. These quotes are designed to clear out excessive inventory, from which LPL is known to be suffering more than its major competitors.

If you want a larger-than 37-inch $500 panel, wait a few months. Displaybank projected this week that 40-inch panels will drop to that level in 3Q, down from an ASP of about $690 now. In 3Q'06 manufacturers were actually making profits of $60 or more per panel, thanks to significant reductions in material costs, labor, and depreciation. That number could drop to $10 in 2007, said Displaybank.

And what will the ASP of a 32-inch panel be in 3Q'07? It may fall to less that $300, says Displaybank, from about $360 now. That's dangerous territory, since manufacturing costs are about $290.

All of this is good for TV set makers and consumers. As for the panel makers, it's easy to see why Sony's Stan Glasgow felt that a little moaning to the press wasn't out of order.

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Prices for LCD TV to drop 30-40% throughout 2007
15 December 2006

Although the global LCD TV market is expected to grow more significantly in 2007, TV vendors and LCD panel makers may face more pricing pressure and prices for LCD TVs will drop 30-40% throughout the year, according to sources.

If the prices drop that low, the prices for a 32-inch LCD TV could only be US$663-774 by the end of 2007, said the sources.

Research firms include DisplaySearch, iSuppli and Displaybank project LCD TV shipments to grow at least 50% in 2007. The annual growth of LCD TV shipments will also surpass those of PDP (plasma display panel) TVs and rear-projection TVs (RPTVs) dramatically in 2007, noted the research firms.

Prices for 32-inch panels may fall to US$290 in the third quarter of 2007, with quotes for 40-inch panels to also drop to nearly US$500 during the period, said Displaybank recently. Prices for 32-inch panels have dropped 37% to US$360 at present, indicated the research firm.

For LCD TVs, prices for the 42-inch segment have dropped the most from January through November 2006, said WitsView Technology. The street prices of 42-inch LCD TVs have reduced 42% to US$2,038 this November, compared to US$3,588 in the beginning of 2006, while those for 32-inch models have dropped nearly 26% during the period, according to WitsView.

Sony recently commented LCD TV prices should fall 25-30% this year. The drop is 5-7% more than Sony's anticipation, according to a recent report from CNET, quoting Stan Glasgow, president of Sony Electronics, as saying.

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Buoyant market for chips, convergence gadgets, LCDs
1 January 2007

This year will likely see the explosive growth of flat-panel TVs, including liquid crystal displays and plasma display panels. Flat-panel TVs now account for about 25 percent of the global TV market, compared to their 10 percent share a year earlier.

Consumers opted for LCD TVs over PDP TVs last year, and the trend will continue through 2007, experts say.

"PDPs are being outspent and outmaneuvered by LCDs that provide a more powerful performance and have clearer resolution. This is particularly the case in the 40-inch diagonal size range. LCD TVs have sold better than PDP TVs from the third quarter of this year," said Woo Joon-sik, an analyst at Tong Yang Investment Bank.

Global flat-panel display module manufacturers, including Korea's LG Electronics Inc. and Samsung SDI Co., are suffering from price-cutting pressure. Particularly in the case of PDPs, the market environment looks to be worsening.

"North American consumers, who had preferred PDPs due to their big sizes, are shifting to LCDs. LCDs provide competitive prices when they are manufactured from modules to TV sets, as well as bigger sizes and most of all, better screen quality," said Jeff Kim, an analyst at Hyundai Securities.

PDP TVs are also disadvantaged in that it is technically possible but difficult to apply the so-called "full high-definition" features to PDPs, whereas an array of LCD TVs with full HD features already exists.

Full HD TVs refer to TVs with two-megapixel screens - the screen quality is six times better than a standard-definition TV.

About 60 percent of LCD TVs being sold in the North American market have the full HD features, but Japanese flat-panel TV makers such as Matsushita have just begun rolling out 50-inch or larger full HD PDP TVs.

Tong Yang's Woo said global PDP makers will likely switch their focus from the 40-inch to the 50-inch range this year, as PDPs no longer have a competitive edge in the most popular 40-inch TV segment.

Hyundai's Kim said PDPs will not offset the effect of declining costs, which are accelerating. PDP TV prices are expected to fall by 10 to 15 percent quarter-on-quarter this year, whereas costs are projected to decrease by about 5 to 7 percent quarter-on-quarter.

Hyundai Securities recently lowered Samsung SDI's target share price from 75,000 won ($80.44) to 62,000 won, citing the continued lagging of PDP sales.

Korea's Orion PDP had smaller share in the domestic PDP market, but the company was recently bought by China's Sichuan Changhong Electric Co.

Currently, 40-inch LCD TVs are the most popular, but experts forecast 42-inch LCD TVs will overtake them in sales this year. Samsung Electronics began rolling out 42-inch LCD TVs, while its competitors such as LG.Philips LCD, Taiwan's AU Optronics, CMO and Japan's Sharp focus on the 40-inch range.

S-LCD, a 50:50 joint venture between Samsung Electronics and Sony, is building its 8th-generation LCD line at its industrial complex in Tangjeong, 110 kilometers south of Seoul. Samsung plans to provide 50-inch or larger LCD panels priced around $1,000 in the second half of 2008, by completing the 8th-generation plant sometime in autumn this year.

The 8th-generation line will be optimized to manufacture 52-inch LCD TV panels, using the world's largest 2,200 x 2,500mm mother-glass substrates. The new line is expected to increase the joint venture's LCD panel production capacity by 50,000 units.

"Flat panel display makers will have a hard time in the first quarter of this year. But from the second quarter, demand will pick up. The second half will likely see some supply shortages," Samsung Electronics LCD business president Lee Sang-wan said.

- - - Cut - - -

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LCD TVs now hottest holiday gadget
29 December 2006

LCD televisions beat out digital cameras to become the top-selling gadget during the 2006 holiday season, according to NPD Group market data released Friday.

From 2003 to 2005, digital cameras generated the most revenue when it came to U.S. holiday spending on consumer electronics, computers and cameras, NPD analyst Steve Baker said. But this year, the $925 million spent on televisions with liquid-crystal displays topped the $825 million spent on digital cameras.

"Clearly, price was a huge driver this year, and availability," Baker said of the LCD TV surge. In addition, LCD TVs spread to the more lucrative 30-inch-and-larger category, which plasma and rear-projection TVs previously had had largely to themselves, he said. A total of 1.3 million LCD TVs shipped in the holiday season, he said.

During the holiday season--the five weeks between Thanksgiving and Christmas--spending overall increased 6.5 percent to $8.75 billion, Baker said.

The third-place category was notebook computers, with $810 million spent on a total of 1 million systems, followed by digital media players, with $720 million spent on about 5 million units, Baker said.

Digital camera shipments increased 20 percent to 4.5 million compared with the 2005 holiday season, but revenue increased only 2 percent Baker said--meaning that the average selling price dropped 15 percent. "There was price compression in general, and especially in the point-and-shoot segment," he said.

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Quotes for large-size LCD TV panels drop to new lows, DisplaySearch says
5 January 2007

Quotes for large-size LCD TV panels dropped to new lows in the first half of January, amid the slow season that still affects the LCD industry, according to DisplaySearch.

Average selling prices (ASPs) for the large-size TV panel segment slumped US$20-35 from those in December, and the lowest quotes for 32-, 37- and 42-inch fell to about US$300, US$455 and US$595, respectively, the research firm said.

Shipments of 37-inch panels fell 6-10% in December. Since demand is falling, prices for the segment continued to decline, DisplaySearch indicated.

Other panel applications, monitors and notebooks, faced the same situation.

For example, prices for 17-inch monitor panels fell sharply due to weak demand, although panel makers adjusted production to cope with the drop in demand. Starting from January, some of new orders were quoted at US$110, the firm said.

In addition, market demand slows down for the 19-inch widescreen segment, so prices for the segment are expected to fall significantly in January.

With buyers controlling inventory for the segment of 19-inch standard panels, many spot orders have pushed panel makers to offer lower price quotations, the firm said.

For 22-inch widescreen panels, DisplaySearch currently sees market demand increasing, as many new brands has been introducing 22-inch widescreen LCD monitor models since the fourth quarter of 2006. Expected to continue in the first quarter of 2007, this will drive prices for 22-inch widescreen panels to further decline.

Prices for notebook panels fell less sharply, with a US$2-4 slide. Generally, supply for notebook panels is at the same level or slightly ahead of demand, the firm indicated.

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Prices Keep Falling
5 January 2007

Major manufacturers have been quoted recently, saying that the plummeting prices for flat panel HDTVs in 2006 were more than they had expected, but that price reductions in 2007 should be smaller. And I dismissed this as whistling in the dark. The new year is less than a week old, and V Inc makers of the Vizio brand of flat panel HDTVs has fired the first salvo. They are offering a 1080p LCD HDTV for under $1,900. That's pretty impressive, if you think it's a 42″ model. But it's not; it's a 47″ model, which has about a 12% larger diagonal size!

This announcement makes it pretty clear that 1080p is going to be the resolution of choice going forward, and the price premimum for the extra resolution over a 720p model is going to evaporate, at least for LCDs and rear projection HDTVs. Plasma models are going to have a difficult time producing a true 1080p panel at an affordable price (many 720p plasmas don't have enough horizontal pixels to completely display a 720p image as it is).

Many LCD manufacturers are pulling back on their plant expansion plans, which means that they expect to have an oversupply with their existing capacity. If that's the case, then expect downward pressures on prices to continue, and we may hear some companies singing the same tune about unexpectedly low prices around this time in 2008.

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iSuppli: Flat-panel TV technologies at a crucial crossroad
5 January 2007

TV will dominate the upcoming 2007 Consumer Electronics Show (CES) in Las Vegas this month, as LCD TV OEMs showcase their latest and greatest products, while providers of other display technologies try to prove that they can remain relevant amid the liquid-crystal (LC) deluge, according to iSuppli.

TV display technologies such as microdisplay rear-projection TV (RPTV) are entering a crucial time when they must either do or die. One slip in deadlines could send the RPTV segment spinning into an unrecoverable decline in market share.

For PDP (plasma display panel) TVs, the main challenge is continuing to weather the onslaught of LCD TVs in the 40-inch-and-larger market. The longer PDP TV can hold out, the longer OEMs will continue to make money selling such sets, assuring their continued support for the technology.

However, it is LCD TVs that are in the best position right now - despite a struggle to achieve profitability in the supply chain. LCD TVs have gained rapid acceptance and adoption among consumers thanks to their aggressive pricing in the third and fourth quarters of 2006, combined with their wide availability in a variety of sizes.

CES will provide a fascinating look at which TV display technologies are garnering the most attention. The event also will reveal the subtle differences in features that will help determine the success of competing TV technologies for the year.

Larger sizes, 1080p get a boost

While CES will feature all sizes of LCD TVs, the majority of interest will be in the 40-inch-and-larger sets, where suppliers are beginning to concentrate on bringing prices down to stimulate sales.

The majority of these large LCD TVs will feature deeper black levels, faster response times-at 4 to 6ms and full high-definition (HD) or 1080p resolutions. iSuppli believes many Taiwanese and Chinese brands will be showing off their LCD TV products at CES to attract attention from retailers and to explore ODM opportunities with branded vendors and contract manufacturers.

Plasma extraction

With PDP sets larger than 100 inches already having been demonstrated at past events, there will not be a great deal of innovation coming from the segment at CES this time. More likely, PDP makers at CES will highlight their push to 50-inch-and-larger sets that have 1080p resolution as they continue to vie with LCD TVs.

RPTV not giving up the fight

In the microdisplay RPTV camp, the majority of the focus will be on the DLP (digital light processing) and liquid crystal on silicon (LCOS)-based RPTVs due to the innovations occurring in these two technologies.

Texas Instruments (TI) and its partners will be showing new thin DLP TVs with improved color saturation and reduced rainbow effect. Full HD 1080p resolutions also will be a key focus for DLP at CES.

In the LCOS RPTV area, Sony will be promoting its Silicon X-tal Reflective Display (SXRD) technology, its own version of LCOS.

For companies producing microdisplay RPTVs, their efforts to attract attention at CES must succeed, as their technologies are under heavy competitive stress from LCD TVs in the market for larger-size sets. If RPTV technologies are to survive, they are going to need innovative models and advances in technology that can impress not only OEMs but also consumers.

Adios CRTs

Do not expect CRT TVs to have any hint of a presence at CES, as they have been a no-show at the event for the past couple of years. With waning consumer interest, this technology is on the decline in the US market and iSuppli does not expect OEMs to waste floor space on the technology.

OLEDs for TVs also will be demonstrated at CES, but again, product introductions are not expected anytime soon.

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Reuters: Flat panel display rev growth to slow in '07 - report
5 January 2007

SEOUL (Reuters) - Global flat panel display revenue is expected to grow 8 percent in 2007, slowing from the estimated 14 percent increase in 2006, as rapid price declines offset booming growth in demand, U.S. research firm DisplaySearch said.

As producers and retailers battle for market share, panel prices have fallen sharply and as a result led explosive demand growth, DisplaySearch said in a report distributed on Friday.

"The significant pricing pressure in most applications will cause total flat panel display revenues to rise just 8 percent in 2007 to $92 billion," it said.

Flat panel display revenue in 2006 is estimated at $85.5 billion, up 14 percent. Demand for large flat-screen televisions has led the growth, with the TV market seen accounting for 36 percent of all flat panel revenue last year.

In 2007, the total TFT-LCD (thin film transistor-liquid crystal display) market is expected to grow 11 percent to $77.5 billion, capturing an 84 percent share of the flat panel display market, DisplaySearch predicted.

PDP (plasma display panel) revenue is expected to be flat from $7.7 billion in 2006, due to sharp price declines at the largest sizes where PDPs are growing the fastest.

By product, DisplaySearch estimated LCD TV display revenue in 2006 at $22.5 billion, up 85 percent. Plasma TV display saw revenue rising 28 percent to $7.2 billion.

But revenues for desktop computer monitors and notebook PC screens likely fell 8 percent and 2 percent, respectively, to $19.5 billion and $9.1 billion, due to price falls from rising supply, the research firm said.

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LCD to beat plasma in '07: Toshiba chief
11 January 2007

The dominance of liquid crystal display televisions over plasma display panel TVs in the global flat-panel TV market will grow in 2007 as high resolution televisions gain in popularity, Toshiba Corp. President Atsutoshi Nishida said in a recent interview.

"The recent expansion in the share of LCD TVs in the U.S. market has proved that consumers prefer LCDs over other types of displays" in both Japan and the U.S., Nishida said. "We are entering an age when Hi-Vision televisions with high image quality will be the mainstream.

"The technological limits of plasma displays, the image brightness of which goes down as manufacturers seek to bolster their resolution, have become clearer" in the eyes of industry researchers.

The dominance of the alliance of LCD TV makers over plasma display panel TV manufacturers "will become even more pronounced" during 2007, he predicted.

But the prices of both LCD and plasma display TVs "might keep on falling" because there will be strong pressure for LCD TV makers to cut their prices if plasma display panel TV makers reduce their prices, he said.

On the outlook for the surface-conduction electron emitter display TVs that Toshiba is developing with Canon Inc., Nishida said his company has high hopes for SED TVs' potential in view of the ultra-high image quality the SED technology enables.

Toshiba wants to prevent SED TV prices from falling and defend its brand position, even if LCD TV prices fall, he said.
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It is intersting to note that LG recently lowered pricing of their base model 42" LCD TV (42LC2D) to $2399.95 MSRP, less than the price of their base 42" HD plasma (42PC3D $2499.95 MSRP).

Robert


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Isochroma - just wanted to thank you for the great LCD tech threads. They're my new reference for info on LCD technology. Way better than any blog out there since there's way less garbage filler.

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Have you incorporated the data from http://www.displaybank.com/ ?

Visit there much? Very similar to what your posting and an excellent resource.
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Pacific Media Associates, global market information experts on large-screen displays, reports that in July the average street price for 40" to 44" LCD flat panel televisions and business displays in North America dropped below those for high-definition plasma displays for the first time in the history of the company's "Flat Panel Display Tracking Service."

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Link to article

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With prices for 42-inch LCD TVs fallen below that for a 40-inch LCD TVs in the beginning of October, shipments of 42-inch LCD TVs are expected to pick up significantly throughout the year-end.

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Just released from Bloomberg:

Sony's Oneda Says LCD TV Prices to Fall Faster Than Expected

Sony is projecting up to a 30% decline in flat panel prices year-over-year for the 12 months ending March 31, 2007. Yowzah.

$3000 in March 2006 = $2100 in March 2007
$2000 in March 2006 = $1400 in March 2007
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*Revenue from sales of semiconductors for DTVs, a category that includes LCD-TVs, will more than double between 2006 and 2010.

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*LCD-TVs will account for nearly half of the revenue in the global large-sized LCD panel market by 2010.

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Worldwide shipments of LCD-TVs are expected to rise to 126.9 million units in 2010, increasing at a Compound Annual Growth Rate (CAGR) of 35.1 percent from 38.1 million units in 2005, according to data from iSuppli's Television Systems service.

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This one slipped by me:

Retailers Primed For Black Friday Flat TV Push


The dollar values illustrated in this article are sick.
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Quote:
Originally Posted by Revolutionary View Post

This one slipped by me:

Retailers Primed For Black Friday Flat TV Push


The dollar values illustrated in this article are sick.

Nice article......I can't believe I'm going to be able to buy 42"pdp for what I paid for my 37"LCD 2 months ago.....

And an EXCELLENT thread started by Isochroma....That took alot of work. Thank you
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Displaybank: 42-inch LCD TVs saw sharper price drop in 2006
17 January 2007



The average price (ASP) for 42-inch LCD TVs plunged nearly 40% from about US$3,011 in January 2006 to US$1,818 in December in the US market, according to research firm Displaybank. In contrast, prices for 40-inch LCD TVs and 42-inch PDP TVs (HD), posted a slower decline of 38% and 34%, respectively.

The price trend appears to come from the countermeasures of both 42-inch LCD TV vendors and LCD panel manufacturers to heighten the position of 42-inch LCD TVs in response to 40-inch LCD TV models from Samsung and Sony, which swept the market in 2006.

In fact, the manufacturing cost for 42-inch LCD TV panels remain higher compared to 40-inch panels. However, with the consumer price gap between 40-inch and 42-inch LCD TVs narrowing from about US$170 in early 2006 to US$60 by the end of 2006, both 42-inch LCD panel and TV manufacturers are projected to suffer difficulties in profits.

TV prices are likely to continue on a downward curve this year, but the fall is forecast to ease to 20% to 25%, according to Displaybank. LCD and PDP panel manufacturing costs in 2007 are unlikely to follow last year's downward trend as a plunge in TV prices in 2006 drove down flat TV prices to the magic price, the market research firm explained.

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Plasma vs. LCD: The Battle Heats Up
17 January 2007

The prize: dominating the big-screen, high-definition, flat-panel TV market. LCD makers have the advantage, but plasma producers are fighting hard

One dominant trend in consumer technology this year will be the evolution in TV viewing habits. A growing number of consumers will be able to watch TV when they are on the go, as their mobile phones double as TVs, while telecom and Internet companies will deploy Internet protocol television, or IPTV, to bring all sorts of video entertainment into homes. Yet no other war to lure customers will be fiercer than the one waged between two flat-panel technologies: plasma and liquid crystal display.

The plasma vs. LCD rivalry is not new. Their battle has been going on ever since households began making the shift to digital and high-definition TV a few years back. But the competition will intensify as movie studios and game companies begin to roll out content in the new "full HD" resolution called 1080p.

The race to offer larger screens has up to now been led by plasma. But the LCD camp has had a head start in making screens to the 1080p standard to show the crisp images of the next-generation high-definition DVDs (see BusinessWeek.com, 2/23/06, "HDTV Moves to the Next Level").

Price Parity in One Segment Lately, in the plasma vs. LCD competition, the balance has tipped in favor of the LCD camp, which has been pouring billions into the effort to make larger panels at cheaper prices. Market researcher DisplaySearch estimates LCD TV display revenues in 2006 at $22.5 billion, up 85%, against $7.2 billion for plasma TV displays, which gained only 28%.

Until two years ago, few had expected LCD to snatch dominance for flat screens larger than 40 inches. LCD panels were more expensive than plasma by as much as 50% in the 40-in. class. Today, though, price parity has been achieved between the two for that segment—although for the 50-in. class, LCD TVs are still some 50% more expensive.

Industry execs believe that at the current pace LCD will displace plasma as the mainstream flat-panel technology in the 40-in. segment, for years the mainstay of plasma. "The big trend this year is the full HD standard and it has been proven that plasma technology is too expensive to make screens with that resolution," says Daniel Kim, Hong Kong-based technology analyst at Merrill Lynch.

Plasma In High Gear The big question is, can plasma TV remain as a major flat-panel device? The short answer: yes, at least for the next few years. That's because it is easier and cheaper for the plasma camp to meet the 1080p standard in screens of 50 inches or larger, where LCD remains a scarcity due to the lack of mass production. "The battle ground will move to the 50-in. class next year and plasma TV makers can't afford to give up their market shares there," says Kim

Indeed the plasma camp is shifting into high gear for a renewed fight. Matsushita Electric Industrial (MC), which controls more than a third of the world's plasma TV market, announced last week it would spend $2.4 billion to build a new mammoth plasma-display factory in western Japan. "We simply can't lose the flat-panel TV battle," says Matsushita President Fumio Ohtsubo (see BusinessWeek.com, 1/11/07, "Matsushita Sees a Flat-Screen Future").

DisplaySearch expects global shipment of flat TVs to almost triple to 147 million units. To get a bigger pie, Korean plasma rivals LG Electronics and Samsung SDI have also been ramping up plasma facilities. Together the big three had a combined monthly capacity of some 1.4 million plasma panels at the end of 2006.

Doubling Production The real test comes next year when a joint venture between LCD titans Sony (SNE) and Samsung Electronics (SSNGY) is due to churn out giant LCD screens in mass volume. The LCD panel venture, S-LCD, is now building a $3 billion "eighth-generation" plant with the capability to cut six 52-in. panels from a single glass sheet. The plant in Tangjeong, south of Seoul, is slated to be completed next fall (see BusinessWeek.com, 11/28/06, "Samsung and Sony's Win-Win LCD Venture").

The S-LCD's new plant joins an existing eighth-generation plant run by Sharp (SHCAY), the No. 3 LCD TV maker after Samsung and Sony. Sharp says it plans to double monthly production capacity at the plant in western Japan to 60,000 glass sheets by July and to 90,000 sheets in 2008. President Lee Sang Wan, in charge of Samsung's LCD unit, predicts consumers will be able to buy a 50-in. LCD TV next year at the price of a 40-in. set in 2006.

Less Price Challenge This Time Such pricing would be a tough challenge for plasma TVs. Yet there are signs things won't pan out in the same way in the 50-in. TV market. For the 40-in segment, LCD manufacturers in Korea, Japan, and Taiwan inundated the market with panels until supply exceeded demand by 60%. In contrast, "Even with the supply from S-LCD and Sharp, the LCD volume in the 50-in. class would be only a quarter of that in the 40-in segment," says Seo Young Jae, senior manager in charge of flat panel products at LG, which makes both LCD and plasma TVs.

Efforts by plasma TV makers aimed at cutting costs and improving quality will likely pay off as well. All major plasma TV makers, including Matsushita, Samsung, LG, and Pioneer are due to bring out 50-in. and bigger sets in the 1080p standard this year. With LCD TVs expected to focus on the highest definition resolution in the segment, plasma could also sell TVs with cheaper HD 720p resolution—good enough for many viewers, Seo points out.

"We don't expect one technology will win over another, at least for the next few years," says David Steel, vice-president at Samsung's digital media unit. "With the bigger market and faster rate of growth, LCD has the momentum. But still, with 13 million to 14 million TVs being sold a year, we have a completely viable plasma market."

Click here to see the slide show.

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Super Bowl brings super-low pricing for HDTVs, says iSuppli
31 January 2007




Prices are falling and availability is rising for high-definition TVs (HDTVs), making them an attractive buy for consumers during the count down to Super Bowl Sunday, according to iSuppli.

"Consumers want the Super Bowl to be a special occasion for friends and family," observed Riddhi Patel, principal analyst, television systems, for iSuppli. "For this special occasion, many consumers are willing to pay the price for new HDTVs. This year, flat-panel and rear-projection HDTVs are cheaper and more available than ever before, making them more alluring to consumers."

The Super Bowl long has served as a sales driver for TVs. Until recently, most Super-Bowl-inspired sales were of the traditional TV set of choice for the football fan: the rear-projection CRT, which provided the largest display available for group viewing of sporting events. However, today's football fans have a wide choice of sets and display technologies, including direct-view models like LCD and PDP (plasma display panel), and rear-projection varieties like DLP (digital light processing), LCOS (liquid crystal on silicon) and 3LCD.

With prices for all these new technologies declining rapidly, consumers have wider choice of TVs, which makes buying decision tougher.

TV retailers are announcing Super Bowl specials, offering incentives in terms of price breaks, free surround sound systems, financing schemes and reduced-price or free installation packages. In some cases, Super Bowl specials involve price cuts of as much as 50%.

Some of the key consumer price points for Super Bowl this month are:

-56-inch full HD DLP TV priced at less than US$2,000, compared to US$2,360 in December

-50-inch PDP TV for as little as US$2,500, after rebate, compared to US$2,900 in December

-50-inch HD DLP TV for less than US$1,250, compared to US$1,690 in December

-42-inch HD PDP TV for less than US$1,000, compared to US$1,800 in December

-42-inch full HD LCD TV for less than US$1,500, compared to US$2,200 in December

-40-inch HD LCD TV for less than US$1,500, compared to US$1,895 in December

-32-inch LCD TV for less than US$600, compared to US$1,190 in December

Beyond the Super Bowl, consumers have plenty of other reasons to buy new HDTV sets. Among these is the upcoming transition from analog to digital TV (DTV). HDTVs sold today increasingly have built-in support for DTV, providing future-proofing for the government-mandated switch-off of analog transmission and shift to digital by February, 2009.

For retailers and TV makers, the Super Bowl season is a key period for sales, coming in the seasonally weak first quarter. TV sales and shipments typically decline in the first quarter following the holiday season in the fourth quarter. This year will be no exception with North America TV shipments in the first quarter, which will decline to 7.1 million units, down 26% from 9.7 million units in the fourth quarter of 2006.

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40-inch Range LCD Panels Beat PDP Panels in 2006
2 February 2007



Monthly 40-inch Range Shipment Trends for 2006


Displaybank (CEO: Peter Kwon), a display market research institute, reported that the LCD outpaced the PDP in the 40-inch range large-size television panel market for 2006.

According to Displaybank's 'Large-size TFT-LCD Panel Supply/Demand Analysis and Forecasts' report, shipments of 40-inch range TV-use LCD panels amounted to 7.8 million units, 400,000 units way above 7.4 million units in PDP shipments. The monthly result basis comparison reveals that LCDs have already surpassed PDPs since August last year, and then, LCD shipments rose at a monthly rate of 5%, while PDP shipments plunged by more than 10%, resulting a reversal in the sequential race for 2006. This result has been increasingly in the spotlight coupled with the given intensified competition between devices in the 40-inch and larger size TV market.

Shipments of 40-inch range LCD panels jumped from 90,000 units in 2004 to 1.2 million units in 2005, and also skyrocketed by more than six times year-on-year in 2006.

In addition, Displaybank predicts that the market share of LCD panels will likely be on a further steeper upward curve in the 40-inch range market in 2007. The firm also added that PDP panel shipments are expected to record 8.1 million units, while those of LCD panels may even top 16.4 million units, more than double the PDP panels'.

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LCD TV demand to grow 23%/yr until 2011-group
7 February 2007

TOKYO, Feb 7 (Reuters) - Global demand for liquid crystal display (LCD) TVs is expected to post annual growth averaging 23.4 percent for the next five years, outpacing estimated growth in plasma TV demand, a Japanese industry group said on Wednesday.

Demand for LCD TVs is likely to rise from 37.1 million units in 2006 to 106.2 million in 2011, accounting for 53.1 percent of total colour TV demand in that year, the Japan Electronics and Information Technology Industries Association (JEITA) said.

JEITA expects plasma TV demand to grow an average 18.6 percent a year to 22.8 million units by 2011, which would represent 11.4 percent of the total market.

LCD TV makers such as Sony Corp. (6758.T: Quote, NEWS , Research) and Sharp Corp. (6753.T: Quote, NEWS , Research) have boosted their presence in a market for 40-inch TVs and above, casting a shadow over the potential for plasma TVs, which used to dominate the market for large flat TVs.

Panasonic maker Matsushita Electric Industrial Co. Ltd. (6752.T: Quote, NEWS , Research), South Korea's Samsung Electronics Co. Ltd. (005930.KS: Quote, Profile , Research) and LG Electronics Inc. (066570.KS: Quote, Profile , Research) offer both LCD and plasma TVs, although Matsushita has bet heavily on plasma.

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LCD Industry to Need New Investment of $60 Billion from 2008 through 2011
12 March 2007

A new investment in the LCD industry is of necessity. At a recent Displaybank Conference held in New York Broadway targeting the U.S. banks and investors, Kim Kwang-Ju, vice president at Displaybank expected that the future LCD industry will need a new investment of $60 billion over the next five years from 2008 through 2011 to respond to the steady upsurge in demand for LCD TVs.

During his presentation, Mr. Kim noted that TFT-LCD manufacturers have spent a total of $92.6 billion on the industry over the past ten years, and given explosive growth in demand, they should allot an extra capital up to $60 billion to new fabrication lines, allowing them to keep a balance between supply and demand in the market.



LCD Demand Forecasts (2007~2011)


Demand for LCD panels will pick up at a yearly rate of 14.2% from 340 million units in 2007 to 520 million units by 2011, but the square meter basis analysis reveals a further rapid growth of 24.6% from 45.4 million square meters to 94.4 million square meters for the corresponding period.



LCD Supply/Demand Forecasts (Area Basis) for Case of No Investment in 2008 and Beyond


Looking at future demand on a square meter basis, although all TFT-LCD investments in progress will be put into practice, the sharp increase in demand will highlight an additional investment of $60 billion from 2008 through 2011.

The prediction is on the assumption that Samsung's seventh and eighth-generation (7G and 8G) expansion plans and LG.Philips LCD's 7.5G project will be all put into practice. Notwithstanding the involvement of the supposition that Sharp Corp. will be successful in boosting its 8G capacity to 70,000 units monthly by the end of 2008, the industry will not keep pace with the upward trend in demand for large-format LCD panels without an additional investment in 2008 and beyond.



CAPEX Promotion Forecasts for Supply/Demand Balance


Therefore, even though an extra investment of approximately $11.9 billion for 2007 is taken into account, a new investment reaching $60 billion is required from 2008 through 2011 in an effort to make up for the shortage, and for 2009, the market will need a new capital of $21.7 billion in 2009, which will become the largest ever investment after 2005, Mr. Kim explained.

To meet the market need, Samsung Electronics and Sharp will make a decision on their next-generation fabrication line investment currently in review in the near future, and the target is likely to be 10th generation in consideration of efficiency and marketability leverages. In addition, LG.Philips LCD, Taiwan's AUO and CMO will start considering new lines for 2008 and beyond more actively, while China's BOE OT and SVA-NEC will likely to invest in 6G and more advanced LCD lines around 2008, according to Mr. Kim.

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LCD panel makers eying 50-inch class TV market
22 March 2007

Leading LCD panel makers such as Samsung Electronics, LG.Philips LCD, AU Optronics (AUO) and Chi Mei Optoelectronics (CMO) are pushing 50-inch class TV panels this year to compete against PDP (plasma display panel) suppliers in the large-size TV market, according to sources.

Samsung plans to introduce two new 52-inch LCD TV panels in the second quarter, the sources said. The panels will feature a contrast ratio of 2,000:1, compared to 1,200:1 before. In the third quarter, the company will also launch 57-inch panels with a response time of 6ms and contrast ratio of 2,000:1, the sources indicated.

Samsung will also unveil 70- and 82-inch panels later in 2007, the sources added. A seventh-generation (7G) substrate can be cut into three 52-inch panels or two 70-inch panels, the sources said.

LG.Philips LCD schedules to roll out its first 52-inch full high-definition (HD) panel in April, panel makers said. The panel will have dynamic contrast ratio of 5,000:1 and response time of 5ms. The Korea-based player has already started shipping 55-inch TV panels in small volumes, the makers added.

AUO will introduce 65-inch TV panel as early as the third quarter of 2007, the sources said. In addition, AUO may very likely roll out 52-inch panels to meet demand in the second half of 2007, the sources indicated.

Following the launch of a 56-inch quad full high definition (QFHD) panel (3,840×2,160), CMO will add two new 52-inch TV panels this year, the sources noted.

Despite the aggressive plans from the LCD panel makers in the large-size TV market, PDP TV will still dominate the 50-inch class flat-panel TV market in the near term thanks to its pricing advantage, the sources explained. The sales volume for 50-inch class LCD TVs will only account for 1% of total LCD TV shipments in 2007, according to DisplaySearch.

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Outstanding Growth in 42-inch LCD TV Panel Market
30 March 2007



Large LCD TV-use LCD Panel Shipment Trends


According to the latest data from 'Large TFT-LCD Panel Shipment Results' report published by Displaybank (CEO: Peter Kwon), a display market research institute, the 42-inch LCD TV panel is approaching its rival 40-inch panel in terms of shipments.

Of the worldwide panel shipments for February, 42-inch panels contributed 330,000 units, while 40-inch panels topped 350,000 units.

Samsung Electronics' seventh-generation (7G) fabrication line, which is capable of generating 8 units of 40-inch panels out of a single glass sheet, came on line from the first quarter of 2005, and then has led the 40-inch segment of the large TV market, while the business for 42-inch panels rolled out at LG.Philips LCD's 7.5G line that came on stream in the first quarter of 2006 was sassing last year. However, since the end of last year, when yields stabilized and AU Optronics (AUO) put its 7.5G line into operations, shipments have continued to surge.

In fact, 40-inch panel shipments almost doubled from February last year, while 42-inch panel shipments skyrocketed nearly 7 times for the corresponding period. At present, Korea's LG.Philips LCD, Taiwan's AUO, CMO and Sharp are manufacturing 42-inch panels in bulk, while Samsung Electronics and AUO are participating in mass production of 40-inch panels.

On the other hand, 46-inch and larger panel shipments hit 270,000 units in February 2007, continuing on a steady upward curve. Displaybank expects that the penetration rate of 40-inch and larger panels in shipments jumped from 7.8% in February last year to 20.9% a year later, and is predicted to surpass 30% by the end of the year.

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An analysis of the current mainstream LCD TV retail price
14 April 2007




According to WitsView's survey, the average LCD TV retail price continued to drop in 1Q07. A decline ranging from 7.0%~17.7% was seen among the 32", 37", 40",42" and 46" sizes. For the first time, the 32" model slipped below the USD1,000 level. This marks a significant change, as they were priced at USD2,475 just two years ago. The same amount of money can now be used to purchase 2.5 models of the same kind.

Among the 32~46" LCD TV category, the decline in the 32" in the past two years has surprisingly not been the steepest (59.9%). The 37", 40", 42" and 46" each respectively saw a 67.5%, 64.7%, 73.7% and a 65.5% drop.

3x"

The 32" is still at the moment the most popular LCD TV size. Although its average cost remains at the USD992 level, models that are priced merely at USD499 have begun to appear in the market beginning from the end of 2006. Not only are Tier 2 manufacturers rolling out such products, Tier 1 players, who have distinguished themselves as manufacturers of high-end models, have also entered this particular market segment. For example, consumers can find a Samsung brand TV for only USD848 at Wal-Mart.

Although the 32" is the most common living room TV size, they may slowly start to migrate to the bedroom, as panel makers continue to produce even larger TV panels targeted for the home living room. If the living room TV shifts to the 40~50" category, consumers are highly unlikely to pick a small-sized 20 inch TV for their bedroom. At the CES 2007 exhibition, numerous LCD TVs were seen in being equipped with a built-in DVD playing function, such as the Toshiba REGZA LCD DVD series, which comes in the 26" and 32" sizes. Through the delivery of more diverse contents, manufacturers strongly hope this will serve as a big incentive in enticing consumers to purchase even larger-sized LCD TVs.

The 37" LCD TV currently stands at USD1,333, down 67.5%, in contrast to 1Q05. The decline is second only to that of the 42", but still higher than the 32/ 40", which poses a threat to the 37" model sandwiched in between. As the 37" is not the most economical size cut for the Gen 7 line of Samsung and S-LCD, Sony and Samsung have literally no products in this particular size group. Without the support of the world's two biggest brands, it has significantly inhibited the growth of the 37" LCD TV.

However, in light of the existing size difference between the 32" and 40" category, Samsung has responded by purchasing panels made by Taiwan in launching 37" TV products in selected markets. Sony is also considering whether or not to launch such products in the Japanese market. However, after already concentrating on the 40" class, devoting more resources now in the 37" class may be a bit too late, as the market focus in 2007 will be on the 40" and above category.

4x"

The average price for the 40" LCD TV is now roughly USD1,723, a QoQ decline of 7%. By comparison, the 42" has slipped 17.7% from the USD2,036 level in 4Q06. This is the first time the 42" price is lower than their 40" counterpart for this quarter.

The 40/42" models basically belong to the same market segment. Underpinned by the aggressive marketing campaign by Sony and Samsung, the demand in the 40" class surpassed that of the 42" class in 2006. The main reason was attributed to the fact that such products were considered high-end a year ago. Thus, consumers were more attracted to the brand name than choosing between the 40" and 42" models. However, the trend now appears to be changing.

With the 40/42" LCD TV price now evidently lower, Tier 2 TV products are becoming more acceptable to consumers. Taking into account the panel source, many of the Tier 2 manufacturers focus on the production of 42" TVs (42" panels are produced by LPL, AUO and CMO. By contrast, 40" panels are mainly manufactured by Samsung and S-LCD, where Sony and Samsung are given priority in the supply) Manufacturers that simultaneously roll out both sizes have begun to scale back on their operations. For instance, Olevia and Polaroid are both placing more emphasis on the 42" product.

As for Tier 1 manufacturers, Sharp stopped producing 45" LCD TVs beginning from 3Q06, and redirected their attention on the 42/46" category in diversifying their panel sources. (Sharp hopes to reach the 10 million LCD TV sales target for 2007. Thus, it will need to acquire panels from outside sources. However, the 45" is produced only by Sharp. By switching to the production of 42" and 46" LCD TVs, Taiwan will help fill the 42" panel insufficiency, while its own Gen 8 line will be responsible for the 46" class). JVC, on the other hand, are introducing new 42/47" models, instead of the previous 40/46" TVs. These developments are helping to push the 42" shipments past its 40" counterpart.

The 46" LCD TV is currently priced approximately at USD2,836, a QoQ decline of 9%. Although the 46" is an economical size cut in the Gen 7 line (The mother glass from the Gen 7 line can make 8 cuts for the 40" class, or 6 cuts for the 46" class), demand is not too strong. Like the 40/42" models a year earlier, the 46" LCD TV is still considered a high-end product, where a USD1,000 price gap exists with the 40/42" models. Coupled by competition from the 50" PDP TV, more demand should begin to appear when the 46" price drops further. The 4 inch gap with the 46" LCD TV allows the 50" PDP TV, which is priced at USD2,890, to be more attractive, as they are priced roughly the same.

Due to its more expensive price, only the Tier 1 makers--Samsung, Sony and Sharp and so forth, are offering 46" LCD TVs on the global markets. Among these various markets, a larger assortment of brands can be seen in China. Changhong, Xoceco and TCL are just a few that have also introduced 46" products. As for the other market segments, the market share is mostly divided among the Tier 1 makers.

Conclusion

After the Christmas season brought forth steep price drops in retail stores during 4Q06, LCD TV prices continued to slide in 1Q07. This is due to the fact that the Jan~Feb period is still a hot selling season in some countries, such as the Chinese New Year holidays in mainland China and Taiwan. Although not as significant as the Christmas holiday season, sales promotions are also seen during the US Super Bowl event.

All in all, in terms of the mainstream living room LCD TV size, Tier 2 makers have already respectively lowered the 32/37" below the USD500 and USD1,000 mark. It is worthy to see whether or not Tier 1 makers will also begin to substantially cut the price of their USD1,300 high-end 32" products. For the 40/42" category, with the average price of the 42" below the 40", it will further boost the shipment growth in the 42" category. The high price tag of the 46" LCD TV should be further driven down by the mass production of Sharp's Gen 8 line. However, more concrete demand will be witnessed when S-LCD's Gen 8 line also becomes operational.

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Prices for 42-inch LCD TVs close to US$1,000
15 May 2007

Prices for most 42-inch LCD TVs now have fallen to around US$1,000, with several brands such as Vizio and Sanyo already pushing their 42-inch models at less than US$999, according to the pricing list of Wal-Mart.

Panel makers, including AU Optronics (AUO) and Chi Mei Optoelectronics (CMO) are ramping up capacity at their 7.5-generation (7.5G) plants, which supplies 42-, 46- and 47-inch panels, while branded makers, channel distributors and white-brand companies are setting an more aggressive pricing to expand the market scale for 40-inch-class TVs, sources said.

With a closer price gap between 40-inch-class and 32-inch LCD TVs, the mainstream demand might shift from 32-inch to 40-inch-class ones, the sources noted.

After falling to US$300, prices for 32-inch panels started rebounding in May due to a tight capacity, branded makers revealed.

Meanwhile, it is not easy for TV makers to raise their prices for 32-inch models while their profitability has already been seriously constrained after prices for the segment fell to around NT$20,000 (US$600). As a result, the makers will strengthen their focus on the 40-inch-and-above models this year, the sources explained.

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iSuppli: TV drives increased TFT LCD dominance
20 June 2007

It's getting harder and harder to see how any display technology can succeed in the face of competition from TFT LCDs. That said, there are opportunities to serve applications for which TFT LCD is not well suited.

TFT LCD has expanded its dominance by building on the notebook and monitor markets, using them as a launching pad for taking over the even larger market: TV. At the same time as the industry moves up in size, it is using older capacity and investing in new capacity to take over the mobile handset display market. Going forward, TFT LCD will become the dominant technology in digital signage and other public displays.

TFT LCD revenues passed US$70 billion in 2006, accounting for 73% of electronic display revenues, according to iSuppli. This is up from 52% in 2003.

iSuppli forecasts that by 2010, TFT LCD will account for 85% of display industry revenues. At the same time, increasing penetration in the main application areas and intense price competition means that the growth rate of TFT LCD will be slowing in the coming years. While the compound annual growth rate (CAGR) for TFT LCD market revenue was a stunning 26% for the period 2003-2007, iSuppli forecasts that it will slow to 9% from 2007 to 2011.

Growth at the expense of others

The rapid growth of TFT LCD is coming partially at the expense of other technologies. In particular, CRT and passive matrix LCD revenues continue to decline, as TFT LCD has displaced them in the desktop monitor, TV and mobile handset markets. Other technologies are finding that their growth prospects limited by TFT LCD. PDP (plasma display panel) revenues are likely to peak in 2008; while unit growth is expected to be strong, rapidly falling prices will outpace it.

OLED (organic light-emitting diode) displays will continue to grow rapidly, but not as fast as over the last few years, as TFT LCD continues to improve in terms of viewing angle, video performance and display thickness, all critical criteria for mobile displays.

As was the case with market development for notebook and monitor applications, the rapid growth of TFT LCD over the past several years has been due to a combination of suppliers pushing into new markets by building state-of-the-art fabs and markets opening up to TFT LCD. In this case, the fabs are in generations six, seven and eight, which are optimized for making 30-, 40- and 50-inch class panels, respectively, and the market is TV. Fueled by an impending cut-off of analog broadcasts, high penetration of DVD players, and the movement toward high-definition (HD) content in broadcast and recorded media, the TV market has been rejuvenated, with many customers replacing their TV sets earlier than they might have otherwise.

As customers have started looking for a new TV, they have often found themselves purchasing a bigger set than they had planned. The availability of 40-inch-plus flat-panel TVs has brought many consumers into a segment that has historically been limited to rear-projection technology. iSuppli expects that 29% of TVs sold in 2010 will be 40 inches or larger, up from 6% in 2005. In 2006, LCDs passed microdisplay-based rear-projection TVs (RPTVs) in the 40-inch-and-larger category, and will pass PDP in the same category this year.

The TV boom

The TV boom has significant implications for TFT LCD panel suppliers, most importantly in terms of the expansion of area production. The area of TV panels produced this year will be more than for all the TFT LCDs produced in 2005. However, the capacity expansion required for this production and the price wars that were the result of a market share battle have caused financial difficulties for some of the largest panel makers.

The increasing dominance of-and aggressive pricing moves by-TFT LCD panel makers continue to create a barrier to entry for new technologies. However, this does not stop companies from developing and attempting to commercialize new technologies. The lure of the TV market is so great that several technologies are attempting to enter it. Most of these are emissive technologies, for example field emission displays (FEDs) and OLEDs.

In both of these cases, there have been many announcements and much activity recently. These and other approaches face significant hurdles, first in terms of manufacturing: Full-color FEDs have never been manufactured in volume, and active-matrix (AM) OLEDs for mobile devices are just entering into production and need to be scaled up 10 to 20 times larger to compete in the most lucrative part of the TV market. But they also will face intense market competition, because TFT LCDs can demonstrate rapid cost declines once new fab generations are introduced, which is amplified by rivalry in the marketplace.

Making an impact

So where can new technologies make an impact on the market? One way is by playing a supporting role for existing technologies. The most important example of this is the developments in solid state and other alternative forms of display lighting. Backlighting of LCDs is the most active area, with new forms of fluorescent lamps – such as external electrode lamps and flat fluorescent plates-exemplifying medium-term transitional technologies. Longer-term, it is clear that LEDs and other forms of solid-state light sources will play a key role in increasing efficiency and lowering costs for large LCD panels.

New light sources also are having an impact on the projection market, with electrode-less high-intensity discharge lamps coming into the market this year. Again, in the long term, there is great potential for LEDs as well as semiconductor lasers to play a role. It is also possible that new forms of miniaturized projectors could be developed as peripheral devices and even embedded into computers, handsets, and other mobile devices.

Another point of entry for new technologies is to avoid direct competition with TFT LCDs. Low-power applications are an interesting market application in this regard. Not only are users demanding better battery life on mobile devices, but there are some applications where it is impossible to have a standard display. Smart cards, removable storage devices and electronic shelf labels are applications that are being created by new forms of displays, including electrophoretic and electrochromic, as well as bistable forms of LCD and direct-view MEMS displays.

TFT LCD is set to continue its relentless takeover of the display market, with digital signage the next likely candidate for large area demand, after TV. It will be difficult for other technologies to compete directly with TFT LCD in the TV market, as well as in other products. However, by supporting and improving TFT LCD performance/cost, or by creating new applications not available to TFT LCD, there will be opportunities for alternative technologies.

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42-inch LCD TV segment making gains against 40-inch segment in North America market
25 June 2007

Thanks to vendors' active campaigns and increased output from 7.5G plants, the share of 42-inch LCD TVs in the North American market has edged closer to the share retained by the 40-inch segment, which is good news for AU Optronics (AUO) and Chi Mei Optoelectronics (CMO), according to industry sources.

In the 40-and-42-inch class, the 42-inch segment has narrowed its gap with the 40-inch rival to within 5% in North America, the sources said.

The 40-inch segment, promoted by Samsung Electronics and Sony, has been leading the 42-inch segment, with the 40-inch segment having a 55% share of the North American market as of the end of April 2007.

But since then, LG Electronics, Toshiba, Westinghouse, Sharp, and Philips have been actively promoting their 42-inch models in North America.

The 42-inch segment has a size advantage over the 40-inch rival in that its screen is two inches larger. AUO and CMO have also geared up production from their 7.5G plants, resulting in an increased supply of 42-inch TV panels, and a rise in the segment's market share, the sources said.

The sources pointed out that AUO's 7.5G line now processes over 40,000 substrates a month, while CMO's 7.5 line processes over 30,000 substrates monthly. CMO expects its 42-inch TV panels to top 100,000 units in July, the sources added.

Monthly demand for 40-and-42-inch TV panels from the North American market totals 350,000 units, the sources said, adding that Samsung recently has been said to be planning a cut in its 40-inch TV panel output.

The sources noted that supply of 42-inch TV panels, which have an average price of USD$565, has been a bit tight at present, and prices will remain stable, or only see slight drops, in the near term.

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LCD set to exceed plasma in flat panel TV sales
3 July 2007

Demand for flat-panel televisions larger than 37 inches is set to swing overwhelmingly in favour of liquid crystal display televisions rather than plasma TVs, the rival technology, according to a senior executive at Sharp.

Hirotsugu Terada, the head of Sharp's audio/video group, forecast that sales of large LCD TVs in Japan would reach 1.1m units in the half year from October to March 2008, compared with 478,000 units for plasma televisions.

In the past, observers assumed that plasma televisions would trump LCD TVs over 37 inches, as they are cheaper to manufacture and the picture quality was thought to be superior. But significant advances in LCD panel manufacturing efficiency, coupled with dramatic improvements in picture quality, are leading more consumers to choose LCD panels over plasma.

Although Matsushita Electric, better known as Panasonic, has announced plans to double production of its plasma display panel output capacity within two years, smaller players in the market have been suffering due to severe price competition. LG Electronics, the world's second-largest PDP maker after Matsushita, is struggling to reduce heavy losses at its PDP business. Recently, LG quietly halted production at one of its three domestic PDP lines as part of a restructuring.

Sharp, a leading maker of LCD TVs, expects global sales of its televisions to grow by 50 per cent to 9m units this year, up from 6m units last year. The company has already doubled production at its second factory in Kameyama, Japan, to 60,000 panels a month from 30,000 panels in January. Next year, ahead of the Beijing Olympics - a key event that will boost TV sales - Sharp plans to ramp up production to full capacity of 90,000 panels a month.

Sharp yesterday launched what it called the "thinnest" LCD TV ever, measuring just 8.1cm in screen sizes ranging from 26-52 inches. The Aquos-brand TVs will debut in Japan next month and in overseas markets by the end of the year, in time for the crucial holiday shopping season.

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The LCD Flat Panel Rises Again
10 July 2007

Strong earnings news from LG. Philips, the world's second largest LCD panel maker, could herald a broader, sector-wide, surge in pricing power

In recent years, consumers have grown accustomed to price declines for high-end liquid crystal display panels used for everything from high-resolution computer monitors to sleek, flat-panel TVs. It was a great ride while it lasted. Now, for the time being at least, it is the manufacturers of thin-film transistor (TFT) liquid crystal displays that are going to have the upper hand when it comes to pricing and profits.

On July 10 LG.Philips LCD (LPL) announced its first profit in five quarters, and this may signal a wider flat-screen industry upturn. LG.Philips, which is controlled jointly by South Korea's LG Electronics and Dutch electronics group Philips, swung to a net profit of $247 million in the April-June period from a $183 million loss in the previous quarter and a $349 million shortfall a year earlier. Sales were $3.64 billion, up 23% from the previous quarter and up 45% from a year earlier.

"Our second-quarter performance was better than expected, which underscored a faster than anticipated turnaround," says LG.Philips Chief Executive Officer Kwon Young Soo. A company statement said it expects a brisk revenue increase with average selling price increase in the low single digits (see BusinessWeek.com, 4/11/07, "LG.Philips LCD's Loss is Really a Gain").

Optimism in the Industry

The upbeat earnings report by the world's second largest LCD panel maker suggests that some semblance of pricing power is returning to this sector which has suffered mightily in recent quarters. "You'll probably see decent margins and sales growth in the industry over the next 18 months when demand will outpace supply, although there'll be a brief seasonal slowdown after the yearend shopping spree," says Cho Yeong Duk, vice-president in charge of LCD business strategy at Samsung Electronics (SSNGY), the industry leader. Other major competitors include Taiwan's AU Optronics (AUO) and Chi Mei Optoelectronics (CMOPF).

Why the optimism in an industry hitherto plagued by a supply glut? First, LG.Philips and Taiwanese makers have been holding back on investment in production facilities in the past year after racing to ramp up production in the previous two. As a result, the industry's supply growth rate is set to fall from 75% in 2006 to 46% in 2007 and 33% in 2008, while demand is projected to rise 54% in 2007 and 38% in 2008, according to research by Merrill Lynch (MLV).

On the other hand, large LCD TVs have become affordable, encouraging consumers to snap them up. Market researcher DisplaySearch expects sales of 32-in. or bigger LCD TVs to jump to 54.9 million sets this year from 31.2 million last year. "Growth momentum for TV sales will accelerate in years to come," predicts Cho at Samsung.

Computers Going Wide

Another key driver of growth for both sales and profits is the burgeoning popularity of wider screens for both desktop and notebook PCs. Debbie Tsao, LCD specialist at Taipei market researcher WitsView, notes the introduction of Microsoft's (MSFT) Windows Vista operating system has prompted consumers to seek wider screens to better enjoy multimedia entertainment functions.

This has a knock-on effect of further tightening supply. To capitalize on booming demand for wide screens, panel makers have switched their production lines to computer monitors from large-sized TV screens. "2007 marks a big transition in the overall TFT-LCD product structure," says Tsao.

It adds up to price gains in the traditionally slow second quarter. Prices began turning up in April for monitor and notebook screens and in May for TV panels. The price of a 17-in. monitor, for example, rose to $127 on July 5, up from $122 two weeks earlier and $98 in March, according to WitsView.

Same Dynamic as 2002

Analysts draw parallels between the business climate now and in 2002 when investment in production capacity was at a low. "As the 2002 shrink in capital investment fueled improvement in panel prices in 2003 and 2004, similar investment cuts in the past year will bring about similar effects in the second half of this year and through 2008," reckons Jay Yoo, display analyst at brokerage Korea Investment & Securities.

Investors seem to agree with such projections. LG.Philips stock has risen 58.9% so far this year to $48 against a 32.1% rise in the benchmark Kospi index of the Seoul bourse. Taiwan's AU Optronics share is also hovering near its 52-week high. With the industry recovering, many brokerages, including Merrill Lynch, Lehman Brothers (LEH), and Korea Investment, are recommending "buys" for LCD makers, particularly LG.Philips and AU, which have focused on profitability in recent months.

Of course long-term prosperity is by no means guaranteed in this notoriously cyclical business. Once these panel makers accumulate cash amid tight supply, a renewed race for building next-generation factories will be just a matter of time. Already, Japan's Sharp (SHCAF) operates a so-called eighth generation (G8) plant, while S-LCD, a joint venture between Samsung and Sony (SNE), is due to launch a G8 factory in August to start churning out panels for 46-in. and 52-in. LCD TVs (see BusinessWeek.com, 11/28/06, "Samsung and Sony's Win-Win LCD Venture").

Next Battle: 50-inch Screens

G8 factories will be vital for the LCD camp if they want to challenge plasma-display makers in the 50-in. TV market. LCD, which until last year spent heavily on seventh generation panel plants for competing in the 40-in. class TV sector, this year became a clear winner in the mainstream thin-TV field by winning a bloody price battle with the plasma camp in the same segment (see BusinessWeek.com, 1/17/07, "Plasma vs LCD: The Battle Heats Up").

"We believe the same will be repeated in the 50-in. class, flat panel TV market," says LG.Philips Vice-President Lee Bang Soo. The company says it aims to roll out large-screen TVs from a G8 factory in 2009, the year when Merrill Lynch expects Taiwanese companies to follow suit. It's a formula that will be sure to benefit consumers in a couple of years.

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Picture brightens for large-size LCD panels, says iSuppli
11 July 2007

Citing rising demand, tightening supply and increasing prices, market research firm iSuppli has raised its forecast for large-size LCD panel shipments for 2007 and the following years.

Global revenue for large-size LCD panels – those with diagonal dimensions of 10 inches or greater – will rise to US$66 billion in 2007, up 22.2% from US$54 billion in 2006. This represents a 6% increase compared to iSuppli's previous forecast of US$62 billion for 2007.

In 2007, worldwide shipments are forecast to reach 353.8 million units, up 25.2 % from 282.5 million units in 2006. iSuppli previously predicted shipments of 350.1 million units for the year.

"Following weak pricing conditions in the fourth quarter of 2006 and in the first quarter of 2007, the large-size LCD panel market entered into a robust recovery in the second quarter-and strong conditions are persisting in the third quarter," said Sweta Dash, director, LCD and projection research for iSuppli. "Demand is rising from all three major markets for such panels: televisions, desktop monitors and notebook PCs. Meanwhile, inventories remain under control. This combination of rising demand and constrained supply is causing overall panel prices to increase. Demand for ever-larger LCD TVs has prompted iSuppli to raise its revenue forecast by a larger margin than its unit forecast."

This strength should continue during the coming years. Dash predicted the large-size LCD panel market would expand to 597.6 million units by 2011, up 2% from iSuppli's previous forecast of 587.1 million units. Revenue will reach US$102 billion in 2011, up 6% from iSuppli's previous forecast of US$96 billion for the year. This will mark the first year the global large-size LCD panel market exceeds US$100 billion in size.

"In the coming years, unit growth will be driven by increased adoption of LCD TVs among the world's consumers," she added "Revenue growth will arise from consumers shifting to bigger LCD TVs, especially to 40/42-inch, and even larger sizes."

Fat sales for flat TVs

LCD TV sales are being driven up by a combination of factors, including lower prices for finished sets, improvements in performance, global shifts to digital TV (DTV) and the arrival of the Summer Olympics in 2008.

Although costs for some panels are increasing or stabilizing, end prices for LCD TVs are expected to continue to decline due to intense competition at the retail level.

iSuppli has upgraded its forecast of global large-size LCD TV panel shipments in 2007 to 77.5 million units, a 2% increase from 75.6 million units previously.

"By 2008, shipments of large-size LCD TV panels are expected to break the 100 million threshold for the first time, reaching 101.2 million units," Dash said. "In 2009, LCDs will become the world's dominant television display technology, accounting for 52% of unit shipments. By 2011, LCDs are expected to take a 65% unit share of the worldwide television market."

iSuppli predicts LCD TV panel shipments will rise to 180.45 million units in 2011, up 5% from our previous forecast of 172.2 million units.

Factors boosting the LCD TV market include increased adoption among consumers and expected capacity increases for 7.5-, eighth-, ninth and 10th-generation LCD fabs, which can produce very large-sized television panels more cost-effectively than older facilities can.

This has caused prices for the 40-inch and larger LCD panels to decline, even as prices stabilize for 37-inch and smaller products. Because of this, the price gap has closed between 32-inch and 40/42-inch panels, which will contribute to higher consumer adoption rates of 40-inch and larger LCD TVs.

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Holy LCD Profitability, Batman!
19 July 2007

Ken Werner
Senior Analyst and Editor

People are actually making money in the LCD panel business. Not long ago the bellwether 32-inch panel was being sold at or below break-even. Now, prices are up and, even though manufacturers have significantly boosted production, supply is not sufficient to satisfy the market demand for 32-inch LCD-TVs, sources at panel-makers told Max Wang and Emily Chuang for a story published in Digitimes yesterday.

The production increases are not trivial. Monthly shipments of 32-inch LCD-TV panels from AU Optronics (AUO) and Samsung Electronics both grew by nearly 100,000 units to more than 500,000 during Q2. (Orders from Sony contributing to AUO’s increasing shipments, sources said.) Monthly shipments of 32-inch panels by Chi Mei Optoelectronics (CMO) in Q2 were 300,000-400,000 units.

The 32-inch WXGA LCD continues to be the largest-selling category of panel, followed by 50- to 54-inch WXGA PDP and 45- to 49-inch 1080p said Rosemary Abowd, VP of Pacific Media Associates. But only the 32-inch had a price that rose in the first half of July compared to the preceding half-month period. ASP increased $5 to $320, according to WitsView Technology. That price is still low enough to allow some first-tier makers to bring 32-inch TV sets in at about $1000, depending on channel and pricing strategy.

Although buyers are moving toward larger LCD-TV screens on average, Taiwanese panel makers believe 32-inch TV will remain the mainstream size over the next few years as they believe this a good size for a second TV.

How long can prices rise? Taiwan’s panel makers think pricing for 32-inch TV panels will increase steadily, while panels of 40 inches and greater may drop slightly. Monitor panels, by the way, are expected to rise by another $2 to $5, peaking in Q4.

So what’s the bottom line for 32-inch LCD-TVs? The panels for these sets have been under-priced for some time, so the increasing prices are not an aberration but a long-needed correction. That means that when it comes to 32-inch TVs from Tier 1 manufacturers, delaying your purchase may get you some improved technology but it will no longer get you a lower price.

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Sharp Sees LCD TV Industry Prices Falling About 25% This Year
27 July 2007

July 27 (Bloomberg) -- Sharp Corp., Japan's largest maker of liquid-crystal display televisions, forecast average industry prices of large models will fall about 25 percent this year as competition increases.

"The price of LCD TVs in the 40-inch category, currently about $2,600 to $2,700, will fall to less than $2,000 by the end of this year,'' Toshihiko Hirobe, deputy general manager of Osaka-based Sharp's large-sized LCD TV business, said today. Prices for 30-inch models are "hitting bottom,'' he said, without providing further details.

Sharp this week reported first-quarter profit rose 1.4 percent on sales of its Aquos televisions, joining rivals Samsung Electronics Co. and LG.Philips LCD Co. in reporting higher earnings. Shipments of LCD TVs will outpace plasma models, such as those made by Matsushita Electric Industrial Co., by five to one this year, according to Lehman Brothers Holdings Inc.

"In Japan, the competition is almost over, with the LCD industry the winner,'' Hirobe said in Kameyama, central Japan, where the company's newest factory is located. "In the U.S., full high-definition LCD TVs will gain a big market share and there will be no room for plasma TVs.''

Matsushita Electric Chairman Kunio Nakamura said he wasn't "worried'' about price declines for flat-screen televisions.

The company, the world's largest maker of plasma TVs, focuses on models with 50-inch or bigger screens to weather price declines. He spoke in an interview in Shizuoka, where Japan's Keidanren business lobby is holding a two-day forum.

LCD TV shipments may surge 76 percent to 74 million units this year, while shipments of plasma TV sets will probably rise 30 percent to 13 million units, according to Lehman.

Plasma Prices

Matsushita on July 25 said quarterly sales of its plasma televisions fell for the first time in the three months ended June 30 because of a 29 percent drop in prices.

The Osaka-based company said net income climbed 9.7 percent to 39.3 billion yen ($330 million) in the fiscal first quarter, as a weaker yen bolstered sales of its Viera flat-panel televisions and Lumix cameras.

Average LCD TV prices at Sharp rose 4 percent in the last quarter after the company focused on larger-sized TV sets, as industry prices fell about 30 percent, Tetsuo Onishi, an executive in charge of accounting, said July 25, when the company reported earnings.

In April, Sharp President Mikio Katayama said the company plans to build a new LCD-making plant, with details on the size of investment, location and timing of construction to be announced by "summer.''

Details on the timing and exact location haven't been decided, Hirobe said today during a factory tour for foreign journalists. The company doesn't plan to build an overseas plant to make LCD panels for TVs, he said.

"Japan is the best location to have cooperation between panel makers and suppliers of materials and equipment,'' he said.

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DisplaySearch Reports LCD TV Panels Enjoyed Record Quarter in Q2'07, Doubled Up on PDPs at 40"+ as Plasma Sales Remained Weak
31 July 2007



40"+ LCD TV and Plasma TV Panel Shipment Results


AUSTIN, TEXAS, July 31, 2007—DisplaySearch, the worldwide leader in flat panel display market research and consulting, reported in its latest Quarterly PDP Module and TV Shipment and Forecast Report and Weekly TV Flash Report that plasma and LCD TV panel sales were headed in opposite directions in Q2'07.

LCD TV panel shipments enjoyed a record quarter in Q2'07, rising 32% Q/Q and 65% Y/Y to 19.6M panels. The Q2'07 results exceeded suppliers' expectations and DisplaySearch's forecast by over 700K panels or 4%. Revenues grew 28% Q/Q and 39% Y/Y to a record $7.2B. ASPs were only down 2% Q/Q and 16% Y/Y to $369. For the first time, twice as many 40"+ LCD TV panels were shipped as 40"+ plasma panels, as shown in Figure 1. The LCD TV share of the 40"+ flat panel market rose from 42% in Q2'06 to 68% in Q2'07. This can be attributed to the amount of optimized Gen 7 and larger LCD fab capacity brought online, to the success of LCD TV brands and retailers in getting consumers excited over 1080p TVs where LCDs have dominated PDPs and to the greater number of LCD TV brands overwhelming plasma TV brands in retail.

Of the total LCD TV panel shipments, the 40"+ share rose from 22% in Q1'07 to 23% in Q2'07 and the 1080p share of all LCD TV panel shipments rose from 10% to 11%. Not all larger sized categories increased share in Q2'07; the 45-47" category fell from 5.0% to 4.7% as prices remained too high for most consumers. 32" remained the dominant size category, earning a 38% share with OEMs and brands likely buying more 32" panels than they needed as 32" panel prices have been rising. LPL remained #1 on a unit basis followed by AUO and Samsung. On a revenue basis, Samsung remained #1 followed by LPL and AUO.

Plasma panel shipments were flat Q/Q and down 4% Y/Y to 2.3M panels. Year to date, plasma panel shipments are down 3% despite a 51% increase in capacity. Plasma panel manufacturers were expecting an increase of 18% to 2.7M panels, so clearly Q2'07 was disappointing. With plasma panel prices falling rapidly, plasma panel revenues were down 13% Q/Q and 37% Y/Y to $1.2B. ASPs were down 13% Q/Q and 34% Y/Y to $507.

Despite the overall PDP decline, there was growth at 50"+ and rapid growth in 1080p panels. The 50"+ share of PDP panel shipments continued to increase, rising from 29% in Q1'07 to 31% in Q2'07 on an 8% Q/Q increase and is expected to reach a 34% share in Q3'07 as PDP suppliers continue to shift their focus to larger sizes due to 42" share losses to LCDs. There was also a dramatic increase in 1080p panel shipments, up 545% to 169K panels with 1080p penetration rising from 1.1% to 7.3%. The increase in 1080p shipments and improved supply should improve their competitive position against LCDs.

Matsushita remained #1 with Samsung SDI overtaking LGE for #2 as shown in Table 1. Of the five major suppliers, only Matsushita and Samsung SDI enjoyed Y/Y growth. By size, Matsushita led at 37", 42", 55-59" and 60"+ while Samsung SDI led at 50". 1080p panels accounted for an impressive 17% of Matsushita's mix, up from just 2% in Q1'07.

Looking forward, PDP suppliers are expecting over a 30% Q/Q increase to over 3M panels in Q3'07. In order for this to happen, we would expect to see PDP TV brands make significant price moves within the next 60 days.

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LCD Continuing March Toward DTV Dominance
14 August 2007

SCOTTSDALE, Ariz., August 14, 2007 - LCD will continue its ascension to market dominance in the worldwide digital TV (DTV) market, reports In-Stat (http://www.in-stat.com). LCD will have almost 75% of the market in 2011, with plasma fading to less than 15%, the high-tech market research firm says. A series of seven recent In-Stat end-user surveys spanning six countries in three regions—North America (US and Canada), Asia (Japan and Korea) and Europe (UK, France, and Germany)—revealed other notable findings.

“US consumers exhibited reduced interest in HD TVs,” says Michael Inouye, In-Stat analyst. “Respondents most interested in HD TVs, for instance, fell from 17% in 2006 to 13% in 2007, while those least interested increased 12 percentage points in 2007 to 65%. International respondents, however, exhibited more interest in HD TVs. Consumers in France and South Korea, in particular, demonstrated strong levels of interest (44 % and 40% high-interest respectively).”

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Prices for second-tier 42-inch LCD TVs to fall to US$699 by year-end
24 August 2007

Although LCD TV brands suffered from dramatic price drops last year, sources have indicated the makers will still follow a low-pricing strategy this year with second-tier LCD TV vendors planning to offer 42-inch LCD TVs at US$699 by the end of the year, compared to current prices which are close US$1,000.

Prices for 32-inch LCD TVs from second-tier vendors are also expected to dip to US$299-399 to meet year-end holiday demand, the sources added.

Besides 42- and 32-inch LCD TVs, sales for 37-inch LCD TVs will also pick up in the second half due to attractive pricing. The price gap between 37-inch and 42-inch TVs is around US$200-300, the sources said.

With the price war continuing in the LCD TV market this year, first-tier and second-tier players are expected to find more difficulty generating profits. Fist-tier makers may be forced to place more orders with ODM/OEM makers while second-tier players will need to control production costs more carefully while they attempt to expand market share through price reductions, indicated the sources.

Prices for LCD TVs fell 30-40% sequentially in 2006 resulting in most TV vendors seeing little profits, the sources noted.

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Quotes for 52-inch LCD panels expected to drop to US$1,000 range in 4Q
11 September 2007

With recent strong market demand for 52-inch LCD TV panels, quotes in the fourth quarter are expected to drop to around US$1,000 and shipments for the segment should top three million panels in 2008, according to sources at LCD panel makers.

Although 52-inch LCD panels are mainly produced at eighth-generation (8G) plants run by Sharp and S-LCD, Chi Mei Optoelectronics (CMO) is also producing panels for the segment at its 5.5G plant to support market demand.

With demand rising, panel makers are willing to lower panel prices to farther advance market growth. Samsung's August quote for its 52-inch LCD panels was around US$1,300 and the price dropped to US$1,200 this month. Prices are expected to fall to around US$1,000 next quarter, a decline of over 30% compared to quotes of US$1,500-1,600 at beginning of this year, the sources noted.

Forecasts for the second half of 2008 call for 52-inch panel quotes to drop under US$900, the sources added.

In the US market, prices for 52-inch LCD TVs average about US$2,700-2,800 and some TVs are priced lower than US$2,000. However, other countries including United Kingdom, Japan, Korea, Taiwan and China, are still seeing average prices above US$3,000.

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Worldwide large-size LCD panel shipments to grow to 430-440 million units in 2008
20 September 2007

Large-size LCD panel shipments are likely to total 430-440 million units in 2008 with Samsung Electronics taking the lead among players by shipping 96-96.8 million units, according to data from DisplaySearch, WitsView and the companies.

The top-four panel makers, Samsung, LG.Philips LCD, AUO (AU Optronics), and Chi Mei Optoelectronics (CMO) are expected to take 75% of total large-size panel shipments worldwide, according to the data.

According to DisplaySearch, LCD TV demand will reach 106 million units in 2008 while supply for LCD TV panels will only total 102 million units during the period.

Demand for LCD monitors and notebooks will reach 180 million units and 120 million units, respectively, next year while corresponding panels are expected to total 194 and 132 million units, DisplaySearch predicted.

The market trend for the LCD industry market for 2008 will be similar to that in 2007, said market sources. A shortage is likely to happen in the second half of the year with large-size panels short by around 5-10%, the sources added.

As notebook panel production cannot be shifted to 6G lines, the supply for notebook panels may see more limitations. In addition, while several vendors such as Apple, Dell, Hewlett-Packard (HP) and Sony are planning to launch LED-based notebooks next year, the market for notebook panels may see another rise, explained the sources.

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Price of LCD TVs expected to fall
27 September 2007

LCD TVs with 46- and 52-inch screens are expected to drop in price now a large new manufacturing plant in Asan city, South Korea, has started producing the flat-panel screens in large volumes.

The plant manufactures sheets of LCD ‘motherglass’, from which eight 46-inch or six 52-inch panels can be cut.

Previously a manufacturer could cut only eight 40-inch panels or six 46-inch panels from a single piece of motherglass.

The new plant, with ‘eighth-generation production lines’, is a joint venture between Samsung and Sony.

The new process will allow the two companies to cut the cost of their sets, and rival companies could be forced to reduce prices as well, in order to remain competitive.

At IFA 2007, Sharp announced plans for a tenth-generation LCD factory. The company will start building the plant at Sakai near Osaka in Japan in November with construction scheduled for completion by March 2010.

The 10th generation plant will manufacture motherglass measuring 8.7 square metres, from which six 65-inch or eight 57-inch LCD panels or 15 panels measuring 42-inches can be manufactured.

At full production, the 10th generation plant will be able to manufacture one million 32-inch panels per month.

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LCD panel prices heading toward another crash
10 October 2007

Problems with the US housing market are predicted to thrown an unforeseen spanner into the works of the LCD TV industry. Market researcher iSuppli says the current Stateside credit squeeze is likely to limit consumer spending on luxury items, such as LCD TVs. Even though some brands have edged up their prices, a drop in demand in the US will create another worldwide glut of panels, once again causing prices to tumble - great news for consumers, but ultimately disastrous for panel makers.

Says Sweta Dash, director of LCD and projection research at iSuppli: “This may affect fourth quarter pricing of large-sized panels. The issue could become more of a problem if consumers stop spending and tighten their purse strings because of the mortgage problems.”

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LCD HDTV Wins
12 October 2007

Market researched DisplayBank has released its forecasts for the worldwide television market, and they predict that the number of TVs shipped will increase 50% from 196 million this year to 290 million units in 2015. This year, about 38% of those sets will be LCD TVs; by 2015 this proportion is expected to grow to 66%.

So if you’re going to go by the numbers, odds are two out of three that you’ll eventually own an LCD TV. Why is that?

The main reason is that there is no viable competition for smaller sized sets. Only CRT (picture tube) televisions are priced lower than LCDs in the smaller sizes, but the actual dollar difference is so small at that point that many people will opt for the advantages of a thin, sharp LCD image. At the other end, the average selling price of a 52″ 1080p LCD is now lower than that of a 50″ 1080p plasma HDTV. (Plasma still has a distinct price advantage at this size in 720p resolutions, but buyers are clearly moving to 1080p.) So LCD now owns the sizes where the vast majority of the sales are going to occur.

The only thing that could upset DisplayBank’s forecast would be a sudden shift to another technology. If a breakthrough in plasma panel production lowered costs significantly, or if one of the novel technologies — such as OLED – made some major advances, then LCD might not do as well as predicted. But for the moment, it looks as though LCD technology will be the winner.

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Sales ratio of LCD TV to PDP TV to reach 10:1 in China in 2008, predicts Digitimes Research
23 October 2007




PDP (plasma panel display) TVs are fast losing market share to LCD TVs in China, where LCD TVs are expected to sell almost ten times more than PDP TVs next year, according to a recent report by Digitimes Research.

With the average size of LCD TVs available in China smaller than that of PDP TVs, but prices more affordable, it is natural for consumers in China to go for LCD TVs, as price is a major issue for TV selection, the research unit said in a recent report assessing the impact of the Beijing 2008 Olympic Games on the TV market in China.

The report remarks that it will be easier for consumers in China to make a decision to buy a mainstream 32-inch LCD TV than to buy a 42-inch PDP TV.

In 2004 the unit sales ratio between LCD TV and PDP TV in China was 4:3, but in the first half of 2007 the gap was widened to 11:1, the report points out. Of sales in the first half of the year, the 32-inch segment accounted for 38% of the LCD TV sales, followed by 42-inch at 15%, 37-inch at 13% and 40-inch at 11%.

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Worldwide large-size LCD panel shipments surpass 100 million units in 3Q, says Displaybank
24 October 2007

Worldwide large-size LCD panel shipments surpassed the one hundred million mark, reaching 107 million units, for the first time in the third quarter of 2007, according to Displaybank. Compared to 97 million units for the full year of 2003, this is the first time for a single-quarter shipment result to hit a yearly figure, the research firm indicated.

Buoyed by seasonal strength and rising demand for the notebook and LCD TV markets, panel shipments surged sharply during the third quarter of this year, the research firm explained.

Overall revenues of large-size LCD panels also jumped 23% from the previous quarter and 45% from a year ago to US$20 billion last quarter. This upward trend in revenues is attributable to the increase in major panel prices. The average selling price (ASP) was up 10% on quarter to US$187, while the panel price per inch also climbed 7% to US$8.9 in the third quarter 2007.

Taiwan-based AU Optronics (AUO) leaped into the top place for the first time in terms of quarterly shipments with 22.3 million units, followed by Samsung Electronics with 22 million units and LG.Philips LCD with 21.2 million units.

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US market: 40-inch and larger LCD TV sales boom in 3Q, says Quixel Research
13 November 2007

After several quarters of modest growth, 1080p LCD TV segment sales lit the category on fire in the US market in the third quarter 2007, and overall LCD TV unit sales in the 40-inch and above segments grew 113% from the previous quarter, according to Quixel Research.

Tamaryn Pratt, Quixel Research's principal, stated that the LCD TV category has already outsold PDP at 42-inch and is now upping the stakes with 1080p resolution models. The wide availability of 46-inch and 47-inch 1080p LCD TV models will soon put pressure on 50-inch PDP where 1080p is not yet widely available, Pratt added.

Revenues for the 40-inch to smaller than 43-inch 1080p LCD TV segment grew 188% sequentially and 362% on year to reach US$1.7 billion in the third quarter. The 40-inch to smaller than 43-inch 1080p LCD TV segment represented 10% of the total category's revenues or up 3% from the previous quarter.

Overall unit sales for the LCD TV category were up 29% sequentially and 73% on year. In terms of sales value, the LCD TV category generated US$5.2 billion in revenues or up 38% from revenues of $3.8 billion in the second quarter of this year. Comparing year-to-year, LCD TV revenues were up 72%.

The total value of the Advanced TV market in the USA was worth almost US$7.5 billion in revenues in the third quarter and the LCD TV segment represented almost 70% of that market. Quixel Research's projections for the US LCD TV market show the category tripling in volume by 2010.

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LCD TV Q3 sales up 48 pct, plasma down 19 pct-study
19 November 2007

TOKYO, Nov 20 (Reuters) - Global sales of liquid crystal display (LCD) televisions grew 48 percent to $17.5 billion in July-September, becoming the only TV technology that has posted year-on-year revenue growth, research firm DisplaySearch said.

In contrast, plasma TV sales fell 19 percent to $3.8 billion due to sharp price falls, DisplaySearch said in a report dated Monday.

Samsung Electronics Co Ltd. remained the largest LCD TV maker with an 18.4 percent share, followed by Sony Corp with 15.1 percent and Sharp Corp with 12.5 percent.

Among plasma TV suppliers, Panasonic maker Matsushita Electric Industrial Co. kept its No. 1 spot, controlling 32.9 percent of the market, while Samsung came in second with 21.3 percent and LG Electronics Inc took a 16.3 percent share. Plasma TVs have seen their share erode in the overall TV market as LCD TV suppliers in recent years encroached on the market for large-sized TVs with 40-inch and larger panels, formerly plasma TVs' stronghold.
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Great thread....thanks!

Looks like LCD is kicking plasma's butt in flat panel land...
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post #26 of 47 Old 03-14-2007, 09:10 PM
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I saw an interesting post on Consumer Reports [won't let me post a link, it is the Electronics Blog entry for 3/7/07] a couple of days ago. It discusses all the factors that led to the dramatic price drops of '06 and suggests that most of them will apply for '07 as well. It includes a list of large screen LCDs that dropped by over 50% in the course of the year (I couldn't tell if the list was of specific, but unnamed models, or the average of models fitting that description). The one that caught my eye was this one:

Quote:


a 46-inch"1080p "Full HD" set fell a whopping 75 percent, from $11,526 in Dec. '05 to just $2,839

I wonder if we see a similar drop this year in the 1080p plasma displays as they move into the mainstream market. Obviously, the price drop won't be this extreme due to the lower starting price and the reduced competition in the plasma market. But I wouldn't put it beyond the realm of possibility for the 1080p plasmas to drop to the current price of the 720p displays (with the 720p displays dropping another 10-20% below that.)
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post #27 of 47 Old 03-15-2007, 07:47 AM
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I agree. Plasmas will have to fall to level of 1080p LCD's in order to survive. I personnaly think plasmas will not be around in the next five years.
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post #28 of 47 Old 07-31-2007, 02:54 PM
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alot of reading but that makes the future look promising...
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post #29 of 47 Old 08-16-2007, 01:35 PM
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All of this is great news. We are hoping to jumping in in the Nov/Dec timeframe this year in the 47"-52" range ... if the prices keep on falling like they seem to be now. We really want to stay with one of the top tier manufacturers, as long-term service seems to be much better from them, but can't see spending ~$4000. Maybe Black Friday weekend will hold some exciting surprises for all of us.

Dick

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post #30 of 47 Old 10-01-2007, 11:46 AM
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I jumped in with a 720p 42" Toshiba Regza this year basically because prices dropped by half vs. a year or so earlier. I'm glad I waited. So many of my friends had urged me to buy back in 2005/2006, but I just couldn't justify the cost, knowing the potential drops coming. I just didn't expect them to drop so fast.

Now I'm waiting for that higher-end 1080p 60" 120 Hz set to drop into mere-mortal territory. I'd like to see one for CAD$2999 (US$3025). I'd thought about the projector route, but there are too many other considerations that make me not want to go with a projector.


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