World is turning flat for PC monitor makers
The Star - Thursday, 20 November, 2002
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fashioned cathode-ray tube computer monitors - bulky, hot, and sometimes
hard on the eyes are headed the way of black-and-white TVs if the Computex
trade show in Taiwan is a guide.
seemingly endless array of flat-screen makers are hawking sleek designs to
a public happy to pay roughly three times the price of a cathode-ray tube
(CRT) monitor, leading to a scarcity of liquid crystal display (LCD)
panels and higher prices.
find the CRT monitors will virtually disappear," predicted Andrew De
Jong, director of Dreamworks IT, a small Australian PC distributor.
Taiwan market research firm predicts flat LCD screens will make up nearly
half of a forecast 141 million monitor sales in 2005, compared with less
than 15% of 106 million monitors shipped globally last year.
LCD sales and prices sent the stock of LCD makers soaring at the beginning
of 2002, although the shares have since eased a bit and some analysts warn
of a looming supply glut. Deutsche Bank has an "underweight"
rating on the sector.
advantages of the flat monitors are clear: They take up less desktop
space, generate less heat, use less power and their slim design is less
visually obtrusive. In affluent Asian cities where space is scarce, flat
screens are especially popular.
are selling space," said Aaron Chen, general manager of Taipei-based
VideoCom Technologies Ltd, a maker of flat screen and CRT monitors, as
he wooed buyers at Computex.
of the flat screen monitors, once an expensive novelty, more than Doubled
in 2001 to 15.4 million units as prices came down. Those numbers exclude
flat screens in notebook computers.
Japan, flat monitors account for more than half of PC displays sold, while
the share is about 30% in the United States, said monitor maker TPV
less affluent markets where price is a larger factor, the proportion of
flat-screens is much lower.
traditional 17in CRT monitor costs around US$160 (RM608) compared with
US$700 (RM2,660) for the same-sized LCD screen or US$350 (RM1,330) for a
15in LCD, according to listings by online vendor CompUSA.com.
30% of PC systems shipped these days come with a flat screen, according to
Taiwan-based Chi Mei Optoelectronics, the world's fourth largest maker of
LCD panels. The makers of large LCD panels for monitors are all based in
Asia, led by South Korea's Samsung and Korean-Dutch joint venture LG
Philips LCD Co.
AU Optronics is on track to be thirdlargest this year, according to one
Among makers of finished flat monitors, Samsung led with an 18% share last year, followed by compatriot LG Electronics and Taiwan's Benq Corp with 8% each.
jump too far?
for flat monitors proved a bright spot during an awful 2001 for the PC
industry, leading to a panel shortage.
LCD panels cost as little as US$190-US$200 (RM722RM760) at wholesale
in the third-quarter of last year, they now cost monitor makers close to
US$300 (RM1,140), according to industry figures.
(sales) volume just all of a sudden doubled. We believe that by the second
half of next year there will be excess (panels) again," said Jason
Hsuan, TPV's chairman and president.
players also predict a boost to supply from new technology that, from
early next year, will enable LCD plants to cut more than twice as many
panels from a sheet of "motherglass." Deutsche Bank warned in a
May 30 research note that LCD panel maker share prices may have gone too
far, as price-book ratios (share price to book value of assets per share)
in the sector were around three times.
(returns are) currently quite high, we believe that over-capacity next
year will drive this down and assume that the long-term return on equity
of the sector is around 10%, implying a fair price to book of 1-2
times," Deutsche said.
Optronics raised US$659.5mil (RM2.51bil) last month in an American
Depository Share offering. Chi Mei plans an IPO this year, while Chungwha
Picture Tube has said it will issue up to US$250mil (RM950mil) in
convertible bonds overseas.
"Companies like Sharp say they want to replace all TVs with LCD TVs. We are moving toward the same direction," said Jeff Hsu, vice-president of marketing at panel maker Chi Mei. - Reuters