Market Focus
The Visual Evolution
CRT monitors are heavy, bulky, consume a lot of power and take up half your desk. Not surprisingly, LCDs are increasingly pushing them off the table and into the bin
By Priyanka Chowdhury
 Despite the slowdown, the visual display market seems to be constantly evolving. According to a recent study by research firm IDC India, by H2 2009 LCD monitors are all set to take over the remaining share of CRT monitors. The research report states that the overall monitor market in India for CY2008 was 6.6 million units, and the contribution of LCD monitors to the same was estimated to be more than 70 percent. The report also states that in CY2008, the total shipments of LCD monitors reached 4.8 million units, well over the 3.7 million units shipped in CY2007, thus recording a growth of 29 percent.
Says Pankaj Chawla, Assistant Manager for peripherals research at IDC India, “The increase in the growth rate of LCD monitors over the last three years clearly indicates a shift in the preference of users from CRTs to LCDs. With the fall in production of CRT monitors, the shipment of CRTs is expected to come to a complete halt, leading to a complete adoption of LCD monitors across all segments.”
Rapid strides
When the LCD monitor was launched in 2000, there were few takers for it due to its high price. However, with the continuing drop in prices, the price differential between LCDs and CRTs has now come down to 20 percent, making LCDs a much preferred option both for the middle-income consumer as well as the corporate segment. Notes R Manikandan, General Manager, Sales and Marketing, LG, “While the price of CRT monitors have remained stable over the past one year, the prices of LCDs have been dropping, hence the narrowing of the price differential between the two. This has further fuelled the demand for LCD monitors.”
Indeed, the increased adoption of LCDs can also be seen from the increase in the demand for stand-alone or non-bundled LCD monitors. As per IDC India’s report, the marketshare of LCDs in the non-bundled monitor segment was 51 percent in CY2007 and 68 percent in CY2008 in terms of unit shipments. Gautam Ghosh, Country Manager, Viewsonic, points out that “in 2008, around 70 percent of the entire LCD sales came from the non-bundled or stand-alone LCD monitor segment.”
LCD vs CRT
The drop in prices is not the only reason which has led to an increase in the demand for LCD monitors—aesthetics also plays a very important role. Consumers increasingly prefer the sleek look and slim size of the LCD monitor compared to the harsh appearance and bulky size of the CRT.
People are also opting for the LCD because of the other benefits it provides. In the current slowdown, organizations are turning to LCDs because these monitors not only consume less power but also less space, thus making them more cost-effective compared to their CRT counterparts.
“Elegant design, improvements in response time, higher dynamic contrast ratios and greater energy efficiency are some benefits that the LCD offers to customers,” explains Ranjit Yadav, Director, IT division, Samsung India. “In addition to feature enhancements, new screen sizes are being created. All this is attracting consumers to LCD monitors.”
Customer segments
The corporate segment has been the main driver of the LCD market so far. “The bulk of the buying is done by the corporate sector,” informs Manikandan of LG. “From the PC market perspective, the corporate segment contributes approximately 65 percent while the consumer segment brings in the balance 35 percent. However, in both these segments, the CRT is fast giving way to the LCD. Massive adoption by BPOs, financial institutions and ITeS organizations has also played a key role in the growth of the LCD.”
Apart from the corporate and consumer segments, vendors are also expecting demand to come in from other segments. Opines Chawla of IDC, “The government and education segments have been late adopters of LCDs, but with the launch of economically-priced entry-level LCD models—such as 15”W and 16”W—these segments have also shown a growing inclination to go in for LCDs. Looking ahead, we expect that from Q32009 the market will pick up as demand is expected from education and other segments.”
Comments S Rajendran, Chief Marketing Officer, Acer, “With the drop in prices and the launch of economy-class monitors, we might see a significant demand from the government and education segments since they would prefer to upgrade from their existing CRT monitors to LCDs.” Adds Ghosh of Viewsonic: “We see the demand for LCD monitors coming predominantly from tier-1 cities. Nevertheless, in 2008, we saw the penetration of LCD monitors in tier-2 and tier-3 cities. This will further help to increase the demand for LCDs in 2009.”
Shades of upgrades
Upgrades of monitors are not just restricted to consumers shifting from CRT monitors to LCDs, but also from standard LCD monitors to wider screen monitors. “With the launch of new screen sizes such as 18.5” and 19”, we are seeing consumers moving from the standard 16” LCD monitors to these wider screen monitors. We therefore expect wide-screen sizes like 18.5”, 19” and 20” to drive the demand in 2009,” says Samsung’s Yadav.
LCD vendors expect to see a lot of opportunity from the upgrade segment as more LCD manufacturers are introducing green LCDs which are eco-friendly and reduce the carbon footprint. “Currently, a lot of enterprises are looking at green computing or green initiatives, hence, with the launch of green or eco LCDs, we do expect to see a lot of organizations and enterprises upgrading from their standard LCDs to the new green LCD monitors,” says Rajendran.
Forecast for the year
Last year, vendors had seen consumers opting for the 17” wide-screen LCD monitor, but in 2009 vendors are increasingly seeing consumers moving toward wider- or larger-screen LCDs. “Until last year the 17” wide-screen was preferred by end-users,” notes LG’s Manikandan. “However in 2009 we expect odd sizes like 15.6”Wide and 18.5”Wide to come up and dominate the LCD market. 18.5”Wide is likely to become mainstream in 2009 with more than 50 percent contribution. Wide-format monitors will dominate the market completely, though square monitors will likely hold a small share, 5-7 percent, mainly from B2B.”
Yadav expects consumers to “continue their shift to larger screen sizes,” and anticipates that the 20” and 20”+ segment will contribute “around 40 percent of the market.”
Meanwhile, vendors are including many innovations and features to increase the attractiveness of LCD monitors: higher resolutions, full high-definition (HD) wider screens and multi-functional solutions—plus computing peripherals such as speakers, i-Pod docks and Web cams. “Consumers will look for more innovations and features in their LCD monitors. Features such as full HD and ultra-fast response time, along with the latest interfaces like HDMI and USB, will become more common in the coming days. These advances in technology are bound to grow further, and penetrate even smaller towns and cities,” predicts Ghosh.
Chawla of IDC points out that vendors are pushing the concepts of multi-display and multi-function monitors in order to grow the market even more. “Digital (DVI) input is now considered a standard feature in many mainstream LCD models, while HD-enabled PC monitor shipments are increasing. With Windows Vista incorporating many media-center type features as a standard offering with the operating system, HDMI and DisplayPort are already featuring on a number of mid- to high-end models. The usage model of linking four or more monitors to one PC/workstation is also gaining popularity, bringing down substantially the cost for commercial users.”
Major challenges
Despite witnessing accelerated growth, there are certain factors which may hinder the growth of the LCD market. The influx of a large number of LCD manufacturers from China has led to an increase in competition among the vendors. “The LCD market is currently cluttered with several players from China. This has led to price-based competition in recent times because these vendors tend to offer LCD monitors at much lower prices,” says Manikandan.
Chawla identifies another factor that’s hindering the growth of the LCD monitor market. “The demand for LCDs had increased when the corporate segment started to upgrade from their existing CRT monitors to LCD monitors. But of late, we have noticed a slowdown in this trend. It’s the growing dominance of notebooks that’s hampering the growth of LCDs because the shipment of LCDs is directly related to the shipment of desktop PCs. With the increasing popularity of notebooks, the shipment of desktops is slowly falling, and this in turn is decreasing the shipment of LCD monitors.”
The future of the display
New technologies such as 3D gaming LCD monitors, OLED screens and thin foldable displays are set to storm the market. “OLED screens have started appearing in the latest mobiles in India. We expect some lower size display in this [LCD monitor] segment to become popular in the next 2-3 years in the Indian market,” says Manikandan.
Chawla points out that LCD assemblers are also pumping research money into using LED backlights instead of traditional CCFL backlighting because LED backlights in LCD monitors give better brightness, contrast and motion picture quality. “With the high cost of RGB backlights, the initial offerings will focus on utilizing white LED backlights, coupled with CCFL for colors,” Chawla predicts. |