The expected boom next year in sales of flat-screen liquid crystal display televisions (LCD-TVs) for living-room viewing will be delayed due to a shortage of the large panels needed to make the products, industry leaders said yesterday.
"LCD-TVs will grow sharply in 2005, not 2004," said Sheaffer Lee (
Lee was addressing a 20-member delegation of foreign journalists that is in Taiwan at the invitation of the government for the 2003 Taiwan Business Alliance Conference, which ended Tuesday.
The flat-panel industry currently produces LCD-TVs smaller than 20 inches in fifth generation, or 5G, factories, which are also known as fabs.
The next generation factories, which cost around US$1.5 billion to construct, aim to produce the more lucrative larger-than-20-inch screens.
Consumers are hungry for a range of new digital products, ranging from flat-screen TVs to DVD recorders and digital music players, Lee said.
Digital products have grown from just 2 percent of BenQ's US$3 billion revenue last year, to 8 percent of this year's estimated US$4.1 billion. That percentage will double to 16 percent next year, Lee predicted.
BenQ has set itself an aggressive target of becoming a major global brand within five to 10 years.
"We want to be the same kind of company as Sony in Japan or Samsung in [South] Korea for Greater China," Lee said.
The worldwide LCD-TV market remains a small percentage of the total demand for LCDs, which including notebook and standalone displays is expected to reach 90 million units this year, according to US-based research firm DisplaySearch.
LCD-TVs will only reach 4 million units worldwide this year, but this will double to between 8 million and 10 million next year, DisplaySearch forecasts. In the same period, BenQ plans to quadruple its LCD-TV shipments from 100,000 to 400,000, Lee said yesterday.
A senior official at Taiwan's largest supplier of flat panels -- AU Optronics Corp (
"Now more than 80 percent of the market is small LCD-TVs," AU executive vice president Hsiung Hui (
"Price is still an issue. For example, a 30-inch TV is still over US$3,000. With that kind of price there's a limit to the market," Hsiung said.
The industry has to be prepared to sacrifice profit margins in larger panels to grow the market, Hsiung added.
Only 2 percent of AU's revenues this year will come from LCD-TVs, but this will grow to between 15 and 20 percent next year, Hsiung said yesterday.
"LCD-TVs are just beginning, but I think this will be the quickest growing segment in the next few years," he said.
Total revenues at AU are expected to grow from US$2.2 billion last year to US$2.6 billion this year, according to company statistics.
Taiwan is facing fierce competition in the race to supply larger screens in newer generation fabs. Japanese and South Korean rivals are expected to ramp up 6G production six months to a year ahead of AU, which is currently constructing a 6G fab in Taichung County.
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