Suppliers of small/medium displays (under 10” in diagonal) will face a much less cheerier holiday season than last year. According to the latest forecast from DisplaySearch, Q4’08 small/medium display shipments will be down 2.2% Y/Y. By comparison, Q4’07 unit growth was up 26%Y/Y, and Y/Y growth has remained positive every quarter during the last three years. The outlook for Q4’08 revenues is only slightly better, up only 3% Y/Y, much lower than the 26% Y/Y growth in Q4’07. The demand for larger and higher resolution displays to support video and internet usage is helping to shore up revenues.
Specifically, DisplaySearch’s latest Quarterly Small/Medium Shipment and Forecast Report, indicates that the market for small/medium displays will reach $25.6 billion and 2.67 billion units for the entire year in 2008, up 15.8% and 7.9%, respectively, from 2007. Half of all small/medium display revenues come from mobile phones; the rest are from a wide range of products including portable navigation devices, MP3 and portable media players, digital photo frames, automotive monitors, printers, and many other applications. TFT or active matrix LCD will account for nearly 60% of all small/medium display revenue this year. Older, passive matrix technologies like STN and TN LCD make up most of the rest, along with the small but fast-growing OLED segment.
The mobile phone segment has much weaker demand this holiday season. As reported in DisplaySearch’s most recent Quarterly Mobile Phone Shipment and Forecast Report, Q4’08 mobile phone display revenues are forecast to increase only 2% Y/Y, much less than the 28% Y/Y growth in Q4’07. “Despite certain hit products like the new 3G iPhone, the overall demand for mobile phones seems to be weakening amid economic uncertainty,” notes Chris Crotty, DisplaySearch Director of Small & Medium Displays Research. Replacement cycles are lengthening in more developed regions as consumers are increasingly reluctant to spend on unnecessary upgrades. In developing economic areas including China, production and job cutbacks have reduced demand for lower-end models.
In addition, the outlook for some other segments is even weaker due to higher penetration rates, feature convergence, oversupply and reduced demand resulting from slowing economies around the world. For example, unit shipments of displays for digital cameras, often a popular holiday gift in years past, are actually forecast to decline from 2007. Even the once fast-moving digital picture frame segment is hitting a speed bump with shipments up only 11% Q/Q and down 19% Y/Y in Q4’08. The digital picture frame and portable DVD markets have been particularly weakened by oversupply resulting from lower-entry barriers and new suppliers.
Other key findings from the latest DisplaySearch small-medium displays research include:
· In 2008, OLED displays will account for 2.6% of all small/medium units; this share has not changed from 2007. Mobile phone sub-displays and music centric MP3 players are the leading applications. By 2015, OLED is forecast to have a 7.3% share of small/medium units.
· Growth in the Portable Navigation Device (PND) segment will slow drastically due to increased competition from in-console automotive monitors and mobile phones equipped with GPS or other location capabilities. After 45% unit growth from 2007 to 2008, the PND market will only increase at an average annual rate of less than 6% per year through 2012 and just 3% through 2015.
· Despite the slowing market, several suppliers have achieved steady unit market share gains over the last year. Hitachi’s share, for example, climbed from 3.6% in Q2’07 to 5.1% in Q2’08, with increased shipments of digital still cameras (DSC), gaming equipment, and mobile phone sub-displays. This year in the DSC segment, Hitachi has added new customers including Pentax, Nikon, and Canon, which has also started using Hitachi displays for printers. AUO’s share has grown from 4.3% to 5.9% during the same period, with mobile phone display shipments up 113% in 1H’08 from 2H’07. AUO has added two key Korean customers: LG last year and Samsung this year. AUO has also managed partially to offset declines in its portable DVD business with fast growing shipments for the emerging Mini-Note PC segment.
Based on detailed supplier surveys, DisplaySearch small/medium research examines shipment, revenue, and pricing data by key metrics including market application, size, resolution, technology and supplier. Available research includes four quarterly reports focusing on different aspects of the market. The comprehensive Quarterly Small/Medium Shipment and Forecast Report provides full market analysis while the Quarterly Small/Medium Pricing Report, Quarterly Mobile Phone Shipment and Forecast Report and Quarterly Small/Medium Value Chain Report focus on ASPs, mobile phone displays, and market share data, respectively. For more information, contact DisplaySearch at +1.512.687.1511 or sales@displaysearch.com.
DisplaySearch, www.displaysearch.com
The NPD Group, www.npd.com
