Interesting article;
sun-sentinel.com
For high-tech producers, the world is looking flat
By CALVIN SIMS
Web-posted: 9:32 p.m. Oct. 22, 1999
MOBARA, Japan -- Just east of Tokyo is one of the world's largest computer-screen factories, where hundreds of humming robots and uniformed workers assemble 200,000 flat panels a month.
Workers cannot produce fast enough to feed the enormous appetite for the flat-panel screens, used in computer notebooks, video games, communications terminals and now, in desktop monitors.
"Right now, we are operating nonstop at full capacity, and we have more orders than we can possibly fill," said Zenzo Tajima, product manager for Hitachi's displays division, which expects its sales of the flat screens, known as liquid crystal displays, or LCDs, to more than double this fiscal year.
Business is booming for flat-screen manufacturers across Japan, South Korea and Taiwan. The main reason is a surge in demand from consumers and businesses around the world for personal computers and other electronic devices that feature the flat screens, which are increasingly appealing because they save space, look stylish and are capable of providing brilliant color images and graphics.
Demand is so strong that Asian producers cannot fill 10 percent to 20 percent of orders, industry analysts and executives said.
"Screen makers will see a huge jump in revenues this year," said David Mentley, a vice president at Stanford Resources, a market research firm in San Jose, Calif.
Analysts estimate that the sales of advanced flat screens used in laptops and desk monitors will reach $11 billion this year, up from $7 billion last year, and that sales could reach $15 billion in 2000 and $17 billion in 2001.
The shortfall has created headaches for computer makers, who are scrambling to satisfy demand for notebook computers and large desktop monitors.
The shortage has come at an awkward time. The year-end holiday gift season is approaching.
Moreover, companies are upgrading their computer equipment in advance of the millennium.
But computer industry analysts say that neither large nor small customers are finding the discounts on notebooks and other computer equipment that they encountered at this time last year. That partly reflects the limited supplies of screens, which have helped push up the prices that screen manufacturers are charging computer makers by about 20 percent to 40 percent.
Consumers also find that they often cannot buy the machine they want without a long wait.
Adriana Maixner, a first-year MBA student at Babson College outside Boston, said Dell Computer's representatives told her it would take at least three weeks to ship a popular $2,800 laptop model with a 14-inch screen. Dell, which helped pioneer direct sales of computers to consumers, typically can ship an order within five days.
In some cases, corporate customers are waiting several months for delivery of computer notebooks and large desktop monitors with advanced flat screens.
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