Prices for TFT LCD PC Monitor Panels Falls by 8% in Jun’08

Sort Date: 06252008

AUSTIN, TEXAS, June 25—DisplaySearch, the worldwide leader in display market research and consulting, explained how industry dynamics are causing TFT LCD panel prices to fall quickly this summer in “PC Monitor Panel Price Reaction,” a recent article by David Barnes in The DisplaySearch Monitor. As in past Crystal Cycles, surging investment in new fab capacity is providing LCD panel buyers with the ability to drive prices down as panel suppliers become eager to sell their output. These prices are confirmed in the Monthly Large-Area LCD and PDP Pricing Report for June that shows the ASP for PC monitor panels declined 8% M/M. This suggests that the down cycle has gained speed. But, we believe such steep declines are not sustainable beyond this summer. Prices may flatten-out or rise in the fall. The DisplaySearch PC monitor panel forecast calls for a 15% ASP decline from Jun’08 to Jun’09.

PC monitor panel shipments increased sequentially in Q1’08, contrary to the normal seasonal pattern. At the same time, demand for desktop PCs flattened or declined in developed markets. Prices for desktop PC monitor displays are therefore leading the Crystal Cycle downwards. The ASP of notebook PC panels fell 5% M/M and 3% Y/Y in Jun’08. The DisplaySearch notebook PC panel forecast calls for a 16% ASP decline from Jun’08 to Jun’09.

DisplaySearch also senses weakness in TV panel prices. Unfortunately, average unit prices are not useful for evaluating the TV panel market because the average panel size grows quickly. We note that global TV brands are introducing low-cost models to compete with new entrants this year, however. These low-cost TV sets will require reductions in panel prices, particularly for 32” TV panels. The average price of 32” TV panels actually increased in 2007, and those levels are not sustainable as more 42” panels come to market. The price report shows that the ASP of 32” regular HD (720p) panels fell 3% M/M in Jun’08. The DisplaySearch forecast for 32” regular HD panels calls for a 20% decline from Jun’08 to Jun’09.

Posted on June 23, The DisplaySearch Monitor article describes various ways to measure the decline and offered action ideas for various parts of the display chain. David Barnes, VP of Strategic Analysis for DisplaySearch, evaluated potential effects of falling panel prices on other parts of the display supply chain and determined, “Material suppliers with strong intellectual property positions should continue to profit during the down-turn.” He added, “Brands and retailers with strong market positions may be able to cross-sell or bundle products to sustain their sales.”

The DisplaySearch Monitor is an online business review that provides insights regarding the global display industry each week and keeps clients abreast of leading indicators such as the DisplaySearch Price Indicator, which correctly predicted the present price decline more than one year ago. For more information, please contact sales@displaysearch.com, or contact your regional DisplaySearch offices in Japan, Korea, Taiwan and China.

About DisplaySearch
DisplaySearch, an NPD Group company, has a core team of 59 employees located in Europe, North America and Asia who produce a valued suite of FPD-related market forecasts, technology assessments, surveys, studies and analyses. Visit the DisplaySearch blog to read about how our top analysts are interpreting up-to-the-minute issues that impact the display industry, and join us in this discussion about technology and the flat panel industry. The company also organizes influential events worldwide. Headquartered in Austin, Texas, DisplaySearch has regional operations in Chicago, Houston, Kyoto, London, San Diego, San Jose, Seoul, Shenzhen, Taipei and Tokyo, and the company is on the web at http://www.displaysearch.com/.

About The NPD Group, Inc.
The NPD Group is the leading provider of reliable and comprehensive consumer and retail information for a wide range of industries. Today, more than 1,600 manufacturers, retailers and service companies rely on NPD to help them drive critical business decisions at the global, national and local market levels. NPD helps our clients to identify new business opportunities and guide product development, marketing, sales, merchandising and other functions. Information is available for the following industry sectors: automotive, beauty, commercial technology, consumer technology, entertainment, fashion, food and beverage, foodservice, home, office supplies, software, sports, toys and wireless. For more information, contact us or visit the NPD website.