Mountain View, CA--According to anew market report by the leading firm following the light-emitting diode (LED) market, Strategies Unlimited, the market for high-brightness LEDs (HB LEDs) grew by a remarkable 108% to $11.2 billion in 2010 and revenue is expected to peak in 2014 at $16.2 billion. Strategies Unlimited says the growth was propelled by applications in TV backlight units, but that expanding supply and a slowdown in overall TV demand in 2011 led to a drastic drop in LED prices, leading to a revised estimate of $12.3 billion in LED revenues for 2011. After peaking in 2014, the market is forecast to fall to $15.3B in 2015. The dip in revenues will be temporary, as lighting will take over as the engine for growth after 2015.
Other highlights from Strategies Unlimited’s new report, High-Brightness LED Market Review and Forecast--2011, include that LED prices have plummeted 20-40%, except for some specialized applications, such as headlamps. Weaker players or new entrants without much experience--like many from China who entered in during 2010--will retreat from the market. As LEDs become more like commodities, only strong players with deep pockets will survive the fluctuations, much like DRAM suppliers.
In addition the report says that revenues of LEDs for lighting will see compound growth of 33% over the period. With LEDs being approximately 30% of the bill of materials, the recent drop in the prices may accelerate LED adoption. For example, a high quality, large volume 1W cool white packaged LED with delivery in September 2011 was quoted around $0.65.
The worldwide digital signage industry experienced explosive growth to $3.4B in 2010. The domestic Chinese market grew 54% to $1.9B and is expected to continue growing at 14% compounded annually through 2015. LED revenues for signs were $1.1B in 2010, growing to about $1.6B in 2015. About 83% of worldwide signs were manufactured in China, with that trend continuing toward Chinese manufacturing.
The mobile appliance segment is the only one with negative growth through the period. Smartphone units will grow at 30% and tablet computers at 57%, compounded annually. However, most mobile appliances, such as feature phones and notebooks, have reached saturation, and falling prices will erode LED revenues by -4.1%, compounded annually.
This report is the latest in a series of reports published by Strategies Unlimited that cover the LED industry. Other reports by Strategies Unlimited include: LED Outdoor Area and Street Lighting (August 2011); LED Luminaries Market Analysis and Forecast (February 2011); and LED Driver IC: Market Review and Forecast--2011 (June 2011).
Founded in 1979, Strategies Unlimited specializes in market research and strategic consulting directed at photonics systems and components, and is part of PennWell’s LEDs and Lighting Media Group which includes LEDs Magazine, Strategies in Light worldwide events, and Strategies Unlimited.
SOURCE: Strategies Unlimited; www.strategies-u.com
Gail Overton | Senior Editor (2004-2020)
Gail has more than 30 years of engineering, marketing, product management, and editorial experience in the photonics and optical communications industry. Before joining the staff at Laser Focus World in 2004, she held many product management and product marketing roles in the fiber-optics industry, most notably at Hughes (El Segundo, CA), GTE Labs (Waltham, MA), Corning (Corning, NY), Photon Kinetics (Beaverton, OR), and Newport Corporation (Irvine, CA). During her marketing career, Gail published articles in WDM Solutions and Sensors magazine and traveled internationally to conduct product and sales training. Gail received her BS degree in physics, with an emphasis in optics, from San Diego State University in San Diego, CA in May 1986.