LCD TV to become largest consumer electronics market by 2012

LCD TV to become largest consumer electronics market by 2012, says iSuppli
Press release, October 13; Ricky Morris, DIGITIMES [Monday 13 October 2008]

Defying challenging economic conditions, the global LCD TV market is expected to continue its rapid growth during the coming years, causing it to become the largest segment of the consumer electronics industry by 2012, according to iSuppli.

Sheri Greenspan, senior analyst, consumer electronics for iSuppli, recently predicted worldwide OEM factory revenues for LCD TVs will rise to US$110.8 billion in 2012, nearly double the US$61 billion in 2007. In 2012, LCD TV revenues will exceed that of consumer appliances. At present, LCD TV is the second largest revenues-generating segment of the 20 consumer electronics product categories tracked by iSuppli.

"Consumers want their electronics, in good times and in bad," commented Greenspan. "Because of this, the consumer electronics market will continue its incremental growth over the next four years, driven by LCD TVs, along with consumer appliances, digital set-top boxes (STBs), digital still cameras and games consoles."

Factors driving LCD TV shipment growth include the global transition to digital broadcasting, rapidly declining prices, and consumer preferences for high-definition displays and thin form-factor sets.

Greenspan noted that global consumer electronics OEM factory revenues rose by 2% in 2007 and are expected to increase by another 6.5% in 2008.

In parallel with the rise of the LCD TV market will be the expansion of the digital STB segment. "Global digital STB factory revenues are expected to grow to US$25.6 billion by 2012, rising at a CAGR of 11% from US$15.2 billion in 2007," Greenspan said. "Consumers continue to upgrade their televisions with new premium services, like HD and Video on Demand (VoD), requiring new STBs." Shipments of STBs also will be driven by consumer demand for Digital Video Recording (DVR), which is increasingly becoming standard in STBs.

Other consumer electronics growth areas include digital still cameras, whose revenues will rise to US$26.9 billion in 2012, expanding at a CAGR of 6.6% from US$19.6 billion in 2007. "Growing demand for the higher-priced digital SLR cameras is helping drive overall pricing up, as is continued consumer interest in higher resolutions and video-capture capabilities," Greenspan said.

Games console revenues are expected to grow to US$14 billion in 2012, rising at a CAGR of 5.9% from US$10 billion in 2007. Mass market adoption, new game titles, accessories and price reductions are helping drive demand, along with evolution of games consoles into media centers, Greenspan said.

Harmonic convergence

Greenspan noted that a massive number of consumer electronics products are prime candidates to undergo a convergence of functionality. More than 800 million individual consumer electronics products shipped worldwide in 2008 could potentially be affected by some form of convergence, a number that will rise to 1.2 billion by 2012. "Elements driving the convergence trend include peer pressure and the 'coolness' factor," Greenspan said. "It also will help consumers to save money as it often costs less to buy a device with converged functionality, rather than buying several devices."