Falling Prices Boost Popularity of LCDs

With prices falling below $500, LCDs are selling in greater numbers than ever before.

Swiftly falling prices of liquid crystal display monitors have caused shipments to more than double in the last year with the market reaching a record 2.9 million units shipped in the second quarter of this year, market research company Display Search says.

The company, which closely follows the computer display market, reported second quarter shipments were 23 percent higher than those in the first quarter and 131 percent higher than the second quarter of last year. As a result, LCD monitor shipments now make up 12.4 percent of the worldwide desktop monitor market on a unit basis, the company says.

Behind the booming interest in LCD monitors is a sharp reduction in price, which has seen monitors with 15-inch panels drop from around $850 to well below $500 and prices are still falling. Last week, Japan's IO Data Device began selling the first 15-inch model for less than $400. The average selling price of LCD monitors dropped 16 percent from the first quarter to the second quarter, the company says.

Because of their higher price, when compared to cathode ray tube monitors, LCD monitors account for 29.3 percent of the worldwide desktop monitor market on a value basis, says Display Search.

Looking ahead, prices are expected to continue falling, bringing more good news to consumers. In the third quarter, which is just ending, Display Search expects average selling prices will fall 20 percent while shipments increase to 4.0 million units. Shipment revenues are expected to climb 12 percent on the second quarter to reach $2.7 billion.

Among trends picked up in the second quarter report is a shift in regional demand patterns for LCD monitors. Japan, which accounted for 44 percent of the market in the first quarter is expected to account for 23 percent of the global market in the third quarter--a result of the worsening economic conditions in the country and the already high penetration of LCD monitors in the local market.

In contrast, increasing demand in North America is expected to see it account for 30 percent of the market in the third quarter, up from 20 percent in the first quarter.

Display Search also notes that, with the decline of the desktop personal computer market, much of the growth in the LCD monitor market is coming as a result of customers buying monitors to replace existing CRT monitors rather than as part of a bundle with a new PC.