Wed, Jan 18, 2006 - Page 10 News List

Flat-panel purchases tipped to rise

INCREASING DEMAND The growing popularity of LCD TVs should help Taiwanese suppliers as manufacturers begin to order more panels from outside contractors

By Lisa Wang  /  STAFF REPORTER

The world's major TV vendors, including top brand Sharp Corp, will purchase more flat panels from Taiwanese suppliers in a bid to cope with fast-growing slim-screen TV demand, a Taipei-based researcher said yesterday.

To secure stable supply of flat panels, some leading TV vendors also manufacture liquid-crystal-display (LCD) panels, a key component for the sleek TVs, by building their own factories, or through joint ventures.

"But their capacity will not be able to satisfy the rising demand for LCD TVs as the market is set to boom after a two year brewing [period]," Lee Kuo-ting (李國鼎), an analyst with Market Intelligence Center (MIC, 市場情報中心), said yesterday on the sideline of an industrial seminar on flat-panel displays.

LCD TV sales are expected to jump to 36.48 million units this year and to 95.44 million units in 2010 around the world, compared to 19.73 million units sold last year as falling TV prices and the transition to digital broadcasting are spurring demand, Lee said.

"They need to look outside for sufficient supply. That will offer a boon for Taiwanese companies," Lee said.

Royal Philips Electronics NV of the Netherlands could set the clearest example of this trend, he said.

Royal Philips would start buying 32-inch flat panels for TVs from Chunghwa Picture Tubes Ltd (華映) this year due to short supply from LG Philips LCD Co, its panel manufacturing joint venture with LG Electronics Co, Lee said.

In addition, Sharp, the world's top LCD TV brand, said last November that it was in talks with a Taiwanese LCD panel maker for 32-inch panel supply to fill a shortfall as much as 30 percent.

Lee said Quanta Display Inc (廣輝), a flat-panel manufacturing arm of the world's biggest contract notebook computer, Quanta Computer Inc (廣達電腦), was Sharp's first pick in light of its long-term ties with Quanta Computer, which makes TVs for the Japanese firm.

Sony Corp and Matsushita Electric Industrial Co, which sells consumer electronics under the Panasonic brand name, face the same problem of looking for new TV panel supply from outside, Lee said.

"Sony now relies on panel supply from a 50-50 joint venture with Samsung Electronics Co, S-LCD Corp. But, S-LCD can only offer up to 40 percent of the panels Sony needs," Lee said.

Sony, which recouped part of its market share last year thanks to the launch of its lower-priced "Bravia" series, needs to source more mainstream 32-inch TV panels from outside suppliers to cope with rising demand, Lee said.

While, S-LCD would focus its strength on making bigger-sized and higher-margin products, he said.

Sony now buys TV panels primarily from AU Optronics Corp (友達光電) and Chi Mei Optoelectronics Corp (奇美電子), he said.

Matsushita Electric, which has stopped investing in LCD panel manufacturing, will have to seek mainstay 32-inch panels, he said.

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