Philips releases market forecast for LCD monitors

JOHANNESBURG (01/16/2004) - The local subsidiary of Dutch electronics giant, Koninklijke Philips Electronics NV, has released market forecast figures covering growth and penetration trends in LCD monitors for the next three years.

According to Tyrone Young, marketing manager: monitors and LCD projectors at Philips, the LCD monitor market will continue its rapid rise, growing from 44.9 million units in 2003 to 103 million units in 2006. "LCD monitor penetration rates will soar from 39 percent in 2003 to 73 percent in 2006," he says.

Young adds that growth rates tend to vary inversely with penetration. "As LCD monitor penetration levels rise, the market growth rate will decrease. The LCD monitor growth rate peaked at 95 percent in 2002, and will gradually level off to 22 percent annually by 2006," he says.

"Because total display device market growth is far below the rate of increase in LCD monitor penetration, CRT market share is destined to drop as LCD share rises," he adds. "In 2002, CRT monitors accounted for 73 percent of the total market, but, by 2004, the majority of monitors sold will be LCDs.

"Furthermore, by 2006, the ratio of LCD to CRT penetration will be completely reversed, with flat panels 'owning' 73 percent of the market, while CRTs will account for only slightly more than one of three display devices."

Examining overall LCD demand by application, significant growth is forecast. By unit count, total LCD demand is predicted to rise from 85 million in 2003 to 180 million in 2006. "Over the 2003 - 2006 period, forecasts indicate the highest percentage growth in LCD TV applications, increasing by nearly sevenfold from 3.2 million units in 2003 to 21.2 million units in 2006."

Young says that due to significant cost reduction on 15-inch models, LCD monitors with 14.1-inch and smaller sizes are expected to virtually disappear. In addition, as the price gap continues to narrow, 15-inch LCD monitors are expected to lose ground to 17-inch models.

"In 2004, 15-inch LCD monitors are expected to fall behind 17-inch and decline from a 51 percent share in 2003 to 25 percent in 2006," he says. "Unit shipments of 15-inch models are anticipated to peak at 26.2 million units in 2006."

Benefiting from a narrowing price gap versus 15-inch models and attractive price points, 17-inch monitors are foreseen to become the top segment. In 2006, 17-inch panels are expected to reach 59. 8 million units, with their share rising from 36 percent in 2003 to 57 percent in 2006.

Under siege from 17 and 19-inch screen sizes, the market share for 18-inch LCDs is expected to decline from a high of seven percent in 2003 to one percent in 2006, Young adds. "While the 18-inch LCD may maintain its niche in financial markets, it will face increased competition from 17-inch and 19-inch models in the corporate market," he concludes.

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