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DisplaySearch: Shortages Loom As LED Grows

Santa Clara, Calif.
– Sales of LED-backlit TFT LCDs will surpass those of CCFL-backlit versions and
achieve an 80 percent market share by the fourth quarter of 2012, according to
the latest DisplaySearch Quarterly LED Backlight Report.

DisplaySearch said
the rapid growth of the technology can be attributed to slimmer designs, lower
power consumption and superior performance than the previous CCFL standard.

DisplaySearch warned that the increased demand will put increased strain on
supplies of critical components for LED production, namely optical polymethyl
methacrylate (PMMA) used in light guide plates, white polyester (PET) for
reflector film, and sapphire for LED wafer substrates.

This could lead to
significant panel shortages.

LCD makers have
been suffering from key component shortages related to LED backlights in Q1 2010,
DisplaySearch said. The PMMA shortages have limited production of TV light
guide plates. Many reflector film suppliers were stretched between demand from
LCD and solar cell applications, and many LED makers faced a sapphire substrate

“Many LCD makers
didn’t recognize the limited capacities of key material suppliers before fixing
their LED TV panel shipment targets. In particular, PMMA and PET are in
significant shortage. PMMA and PET suppliers are slowly expanding capacity
since they need time to add new plants and face financial limitations,” said
Kevin Kwak, DisplaySearch research director.

“To expand the
LED-backlit LCD TV business successfully, LCD TV panel or TV set makers need to
consider product competitiveness, including effective procurement, design
innovation, cell business models and sales strategies because many consumers
feel the price of LED-backlit LCD TV sets are still too high,” noted Kwak.