November 21, 2002 11:39 AM PST

LG Philips sees its screens on TV

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LAS VEGAS--LG Philips says it wants to see its liquid crystal displays on television.

The company, a joint venture of LG Electronics and Philips Electronics formed in July of 1999, makes LCDs for companies such as Dell Computer and other resellers that sell computer monitors to consumers. But at this year's Comdex Fall 2002 trade show, the company has revealed a new goal: To see more of its screens appear in televisions and on the seat backs of cars.

"We're No. 1 in the market for PCs, and we want to be No. 1 in the television market," said Bruce Berkoff, executive vice president at LG Philips. The company is the market leader for 10-inch and larger displays for desktop flat-panel monitors, according to research firm DisplaySearch. "Cars are a tremendous opportunity, when you think that you can fit two 7-inch displays in the backs of seats, which can keep kids occupied."

The company is beginning to reap the benefits of a manufacturing plant it finished building and opened in late May. The new plant allows LG Philips to create larger-sized panels and to speed up the time it takes to make the screens. Berkoff added that the yields--the number of screens that pass as acceptable--for the plant are in the "high 80 percent range."

Berkoff wants to take advantage of the quickly growing flat-panel television market. By 2004, the company expects to have 10 to 15 models of flat screens in different sizes and screen resolutions. By the third quarter of next year, it plans to have a 42-inch flat panel available--a size that rivals that of plasma screens.

LG Electronics, meanwhile, already makes plasma-screen televisions and provides the screens for Gateway's 42-inch plasma TV, according to sources.

The market for flat-screen televisions that are 10 inches and larger is forecast to grow 62 percent annually from 2004 to 2006, rising to 18 million unit shipments from 2.6 million this year, according to DisplaySearch analyst Ross Young.

"Panel makers are licking their chops over televisions, because they consume even more glass than PC monitors," said Young.

The problem lies in the pricing of the televisions that the panels are used in, Young added. Retailers are marking up televisions at 3 to 4 times the cost of the panels. PC monitors are marked up by just less than 2 times the cost of the panel.

Young estimated that 30-inch flat-panel televisions will come in the $5,000 range, but projected that pricing could fall to $999 by 2006.

"At $999 is when you'll see flat-panel televisions take off," he said.

At Comdex, LG Philips announced a new 21-inch LCD with a 176-degree viewing angle, which allows the display to be read more easily.

The company has also demonstrated a 23-inch flat panel and has a 30-inch screen in low-volume production. The 23-inch flat panel will be in televisions by the first quarter of 2003.

In related news, Samsung, which makes and sells panels and monitors, is demonstrating two large flat-panel televisions at Comdex. The first is its Syncmaster 400T, a 40-inch model that can be used as a television or a PC monitor. It will be available early next year for $10,999, a company representative said. The second, shown in a prototype, offers a 46-inch screen. Pricing and availability on the 46-inch model has not yet been set, the representative said.

 

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