BenQ sees a bright future for flat-screen TV market

Taipei Times: How do you see the potential of liquid crystal display (LCD) TVs, compared to the plasma display panel (PDP) televisions?

Peter Chen (陳其宏): The global demand for LCD TVs is expected to skyrocket to about 8 million to 10 million units next year from 4 million this year. Therefore we're pretty optimistic about the LCD TV market. Last month we shipped about 20,000 to 30,000 LCD TVs, adding about NT$1 billion to our revenue, and we are expecting an output of around 500,000 units next year, up from 100,000 units for this year.

We are basing our optimistic outlook on the facts that the supply of flat screens is stable and a further price cut in such televisions is expected. The two factors will be in a favorable situation for the LCD TV market next year.

Though PDP TVs are predominant in large-sized flat-screen televisions with 50-inch and 60-inch screens, I think the situation may reverse within the next three years, because LCD flat panel providers are able to provide bigger displays at lower prices as technologies have improved a lot over the past few years. The operation of new [more efficient] factories will also help improve the tight panel supply situation.

TT: As demand for flat-screen TVs has been taking hold during the current quarter, what's your projection about the price trend of LCD TVs?

Chen: According to our understanding, panel supply will remain stable in 2004. As panel supply is still very tight in the current quarter, I don't expect a supply glut to appear during the first or second quarter of 2004 as predicted by Hon Hai Precision Industry Co (鴻海精密) Chairman Terry Gou (郭台銘) recently.

I don't think a serious panel shortage will relapse next year, either. Some local panel manufacturers have actually strategically differentiated themselves from rivals in order to survive the steep competition. Take Chi Mei Optoelectronics Corp (奇美電子). The company has focused particularly on producing large LCD panels for flat-screen TVs.

Therefore, the price trend for the sector is that the LCD TV prices will continue to drop in 2004 after a 30 percent to 40 percent plunge this year. The downward trend is unavoidable, but the pace of decline will slow down as flat-panel TV sets are still niche products. A 20 percent to 30 percent drop is foreseeable.

TT: You are a display veteran. How does that background help you lead a digital multimedia team?

Chen: I started my career at the display department of Teco Electronic & Machinery Co (東元電機), which produced own-branded TVs and had an original equipment manufacturing service. We've been working in the area for at least 12 years. I led a research team developing CRT monitors at Teco. As a leader of the CRT OEM team, I had a lot of opportunities to visit our customers in order to meet their needs. I left Teco in 1998 and came to work for Acer Inc and to BenQ Corp (明基電通) after the group's restructuring in 2000.

The background in the research and development sector of the display industry has enabled me to better control new product development in order to cater to consumers' needs. As an engineer, I pick up new technologies quicker. Because of the long-term negotiations with original equipment manufacturing clients, I have a better understanding of customer needs and am capable of bridging the gap between engineers and marketing people during new product design.