Display Driver IC's Revenue to Decline Next 3 Quarters: iSuppli

Taipei, Aug. 25, 2010 (CENS)--Global revenue from sales of display driver IC (DDI) used in LCD screens, a key component-will decline during the next three quarters as rising inventory, slowing consumer demand and technological innovation lead to a deceleration in shipments, according to iSuppli.

The electronic display research firm explained that while DDI revenue rose steadily during the first two quarters of 2010, the reverse would be true for the last two quarters of the year, as well as for the first quarter of 2011. Starting from US$1.63 billion in the second quarter, DDI revenue would dip to US$1.59 billion in the third quarter, slide further to US$1.51 in the fourth quarter, and then take a dive to US$1.36 billion in the first quarter of 2011. By then, DDI revenue would have fallen 16.2% compared to the second quarter of 2010, the company said.

"DDI unit growth also will be offset to a significant degree by the evolving technology of thin film transistor (TFT) panels, an LCD variant that offers improved image quality," said Randy Lawson, manager and principal analyst for display and consumer electronics at iSuppli. "Large-sized LCD panel technology and semiconductor trends are heading toward the use of so-called triple-gate designs, which integrate more complex semiconductor functionality onto panels and reduce external, discrete driver IC design complexity in order to lower costs and to increase reliability of notebook and monitor displays. The new designs call for fewer discrete driver chips to be used, thus impacting the overall growth potential of the DDI space."

Furthermore, the DDI market will be impacted by continuous cost-down measures from an industry that's intent on slashing losses, as well as by projected declines in the average selling prices (ASP) from 2010 to 2014, iSuppli added. As a result, the industry's five-year compound annual growth rate (CAGR) beginning 2009 is expected to decline 5.2% to US$4.2 billion, iSuppli's semiconductor market research indicates.

Uplifting factors include the adoption of stunning organic light-emit diode (OLED) screens into a greater number of mobile display applications, the newly energized market for e-readers and tablet PCs, and the increased implementation of high-definition panels in monitors and TVs, iSuppli said.

Global Display Driver IC Revenue Forecast (Billions of U.S. Dollars)
	Q1'09	Q2'09	Q3'09	Q4'09	Q1'10	Q2'10	Q3'10	Q4'10	Q1'11
Billions of Dollars	1.01	1.40	1.66	1.52	1.54	1.63	1.59	1.51	1.36
Source: iSuppli Corp. August 2010