Lower-cost LED backlights darken CCFL’s future

May 7, 2012 — Low-cost direct light-emitting diode (LED)-backlit liquid crystal display (LCD) TVs were introduced in March 2011, targeting share in the entry/mainstream LCD TV market currently dominated by cold-cathode fluorescent lamp (CCFL)-backlit TVs.

Samsung Electronics has launched its first direct LED-backlit TVs, the EH series, in the US, and LG Electronics will follow soon with its LS3400 series.

Also read: Cheaper LED backlights require LED, plate materials changes

LED-backlight penetration in the LCD TV market has been lower than expected, especially in the entry/mainstream segment: 9 points lower than DisplaySearch’s 2011 forecast overall. LED technology for backlights was more expensive than anticipated, limiting consumer purchases. Edge backlight designs were not able to meaningfully reduce the cost premium over CCFL backlighting, though the concept has helped TV makers maintain revenues against a severe market overall.

Figure 1. Trends for LED-Backlit TV Price Premium and Penetration. SOURCE: Q1’12 Quarterly LED Backlight Report.

Now, TV makers are focusing on new types of direct LED backlighting to capture a broader swath of consumers, adding value to the entry/mainstream segment just as edge LED backlighting added value to the premium segment TVs. At the same time, the CCFL industry is experiencing shortages in rare earth metals, stressing already-tight cost structures. There are fewer new CCFL-backlit models this year. DisplaySearch expects the price premium for direct LED-backlit TVs over CCFL-backlit TVs to decrease quickly.

In the Q1’12 Quarterly LED Backlight Report, DisplaySearch forecast that LED backlighting, with help of low-cost direct designs, will achieve 100% penetration of the LCD TV application by the end of 2014, killing CCFL designs. Low-cost direct LED backlighting (~20% share in 2014) will take share away from CCFL backlighting, not from edge LED backlighting. At the same time, edge LED backlighting will continue to incrementally replace CCFL backlighting. Low-cost direct LED backlighting will saturate after CCFL-backlit TVs leave the market and maintain its market position in the entry/mainstream segment.

Figure 2. Forecast for TV Panel Shipments by Backlight Type. SOURCE: Q1’12 Quarterly LED Backlight Report

These changes to the TV market will affect the market for CCFL in other displays, such as monitors. In Q1’12, revenue from CCFL for TVs is estimated to be 81% of total CCFL revenue, as reported in the Q1’12 Quarterly LED Backlight Report. It is not an exaggeration to say that the current CCFL supply chain depends solely on the shipments of TVs. If demand for CCFL in TVs disappears, then it will be hard for the CCFL industry to maintain its supply chain, because the other applications account for only 19% of total demand. Therefore, we forecast that after CCFL-backlit TVs leave the market, most CCFL-backlit monitors will face EOL as well.

Learn more at www.displaysearch.com.

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