LED backlighting market for LCD panels to see rapid growth

June 16, 2009
After several false dawns, it looks like the market for LED-backlit LCD panels is really starting to take off.
[Comment on this article on the World of LEDs blog. Are we poised to see the next big LED application come to fruition, or are the market research firms being over-optimistic once again?]

The market for LED backlighting for LCD panels is now firmly on the strong upward growth trajectory that has promised for several years, according to two separate press releases from market research firms iSuppli and DisplaySearch.

DisplaySearch estimates that 10.6 million LED-backlit LCD panels larger than 10-inch diagonal were shipped in the first quarter of 2009, and the total for 2009 is expected to reach 104.5 million units. Meanwhile, iSuppli predicts that the proportion of TVs using LED backlights will grow from 3% in 2009 to 39% in 2013, when total shipments will reach 90 million units.

Large-area (10-inch plus) LED backlit LCD panels

Q1-09 leading LED panel makers Meanwhile, DisplaySearch has focused on large-area (10-inch plus) LCD panels. The company estimates that 10.6 million panels with LED backlights were shipped in the first quarter of 2009 (Q1-09). This represents a year-on-year increase of 780%.

The penetration of LED backlights was 12% for Q1-09, and will reach 25% by Q4-09. Total shipments of LED backlight panels are expected to reach 104.5 million units in 2009.

Currently, portable computers are the leading application for LED backlights, with 4.2 million LED backlit panels shipped for mini-note PCs (netbooks), equivalent to 100% LED penetration. Also, 5.9 million notebook PCs had LED backlights (26% penetration) in Q1-09. By Q3-09, LED backlights will exceed CCFL backlights in notebook LCD panels.

All mini-note PCs used a wedge-type LED backlight design, but it is expected that slim type backlights will be used starting in Q2’09. In Q1-09, 76% of notebook LED backlit panels used wedge-type light guide plates.

2009 leading panel makers The value of LED backlights for LCD monitors is still not clear to end users, therefore the adoption is limited to only 0.5% penetration, or 0.1 million units, in Q1-09.

For TVs, shipments of LED backlit LCD panels were 0.4 million units in Q1-09, mainly 40-, 46- and 55-inch models and dominated by Samsung's side-lit LED TV models. LCD TV panel makers are planning to ship 4.3 million panels with LED backlights in 2009, 68% side-light type and 32% direct.

David Hsieh, Vice President of DisplaySearch, said, “The driving factors for the fast growth of LED backlights are slim and lightweight form factor, lower power consumption, market differentiation, dimming backlight capability, wide color gamut, and the trend towards green displays. However, there are many challenges in LED backlight design, components availability and cost, and panel makers are working closely with LED backlight supply chain participants to increase shipments.”

Hsieh added, “The growing LED penetration in TFT LCD will raise new issues such as LED cost management, LED chip availability, and changes in backlight structure. As LED production shares the same capacity with the lighting market and many LED companies are evaluating the strategy for backlights, the market has some concerns over LED availability. We believe LED supply chain management will be a key success factor for panel makers and will reshuffle the competition landscape from now to 2010.”

TV market

iSuppli focuses on the use of LED backlighting in LCD TVs, and predicts that as prices of LCD panels that use LED backlights fall in the coming years, their use in TV is set to explode.

Global LED TV panel shipments Just 438,000 LED-backlit TV panels were shipped in 2008, but this will shoot up to 90 million units in 2013, says the company, while the proportion of LED backlight technology in LCD TV panels will increase from 3% in 2009 to 39% in 2013.

"The price gap between LEDs and the CCFLs traditionally used for LCD backlighting has narrowed due to the higher yield rate of LEDs, as well as the oversupply that resulted in a drastic price reduction for LEDs in the second half of 2008," said Sweta Dash, senior director, LCD research at iSuppli. "And with the advent of green technology, power savings and thinner form factors, more branded manufacturers are looking at LED-backlit LCD TVs in 2009. These factors are spurring brand-name television manufacturers to adopt LED backlighting."

Instead of focusing only on color gamut and picture quality using high-end RGB LED-based backlights, TV manufacturers are starting to concentrate more on thinner form factors and lower power consumption with the use of edge-type white LED backlight solutions.

The lower price differential between CCFL and white LED solutions, combined with the lure of thin TV, has led to an increasing adoption rate of LED-based TVs. In some cases, power savings with the use of LED backlights can be as high as 30-50%, and thickness and weight savings also can be as high as 30-50%. Requirements for reduced power consumption for TVs, backed by legislation, will help to drive the adoption of LED backlights.

iSuppli notes that the LED backlight supply chain is still evolving. Some panel suppliers are either entering joint-venture partnerships or developing their own in-house LED solutions to streamline the value-chain process, reduce costs and gain better control over the supply.

The price difference between LED- and CCFL-based TV systems may range from $300-700, depending on the size and type of LED used. The gap, however, is expected to narrow in the future, and many branded TV manufacturers are planning new LED-based TV models with very aggressive prices in the second half of 2009.

For LCD panels (rather than the complete TV), the price difference between CCFL and LED is likely to fall rapidly to less than $100 for 40- and 42-inch panels (currently more than $150), and to below $150 for 46-inch panels.