World Production of Color LCDs for Mobile Phones Seen Rising 92 Pct. in 2001
October 29, 2001 (TOKYO) -- World production of color liquid-crystal display panels for mobile phones is expected to reach 48.26 million in 2001, up 92 percent over the previous year, according to a survey conducted by Nikkei Market Access.
Over the full year, the figures look excellent, but the story is quite different when quarterly trends are considered. In the first quarter of 2001, production of color LCDs for mobile phones rose sixfold year-on-year to 12.87 million panels. But in subsequent quarters, production showed virtually no growth at all.
In the fourth quarter of 2001, production is expected to fall one percent year-on-year, down to a similar level as in 2000. In 2002, although there are several unforeseeable factors such as the effect of the September 2001 terrorist attacks in the United States, a gradual rebound is expected in the European market and production is forecast to reach 69.21 million panels, a 43.4 percent increase over the previous year.
Development of Offshore Markets is Crucial
The driving force behind the rapid growth in 2000 of color LCDs for use in mobile phones was of course the color-display mobile phone boom in Japan.
Internet-enabled content services, typified by NTT DoCoMo Inc.'s i-mode service, accelerated the move to color panels. Nearly all the handsets manufactured for the Japanese market in 2001 have color panels. However, with Japan accounting for over 90 percent of the market for color mobile phones, the Japanese market has practically reached saturation point now.
At the beginning of 2001, LCD panel makers were anticipating a surge in color-enabled handsets in Europe, the largest market for mobile phones worldwide. In the second half of 2001, the infrastructure would be in place for General Packet Radio Service (GPRS), the standard best suited for high-speed data services in Europe, and this would drive demand for replacement purchasing of mobile handsets. Such was the scenario envisioned by the LCD manufacturers.
Contrary to expectations, however, the European market experienced a sharp decline in demand for mobile phones. Moreover, carriers in Europe have gone through a financially debilitating process to obtain 3G licenses, leaving them ill-prepared to aggressively expand their data services. Many observers expect the effects of the September terrorist attacks to further depress business conditions and the downturn in mobile phones to continue.
However, it is also true that the LCD industry is "too much influenced by backward-looking thinking these days," as the marketing manager for one LCD panel maker put it. There have been a number of new ideas for developing color LCDs for mobile phones recently. Despite the slowdown in 2001, a great many mobile phone manufacturers in Europe and the United States are working hard to turn the situation around. There is no call for over-optimism, but the color mobile market in Europe could rebound given the opportunity.
In terms of the technology, passive matrix, super-twist nemonic color LCDs are proving to be much stronger contenders than expected. Production of active matrix LCDs for mobile phones, including both thin-film transistor (TFT) and thin-film diode (TFD) technology, was predicted to surpass passive-matrix LCD production over the whole of 2001, but passive matrix production stayed ahead through the first three quarters of the year. In the fourth quarter, active-matrix LCDs will exceed passive-matrix LCDs, but active matrix production will still only be 19.43 million panels for the full year, as against 28.83 million panels for passive-matrix LCDs.
Note: Figures for 2001 and 2002 are estimates. Data compiled by Nikkei Market Access.
Related story: Worldwide TFT-LCD TV Production to Reach 810,000 Units in 2001
(Ken Nakamura, Nikkei Market Access) |
