While July may seem quite a while ago at this point, the final counts for shipments are coming out for July 2011. Thankfully, for small- and medium-sized displays (SMD), "shipments […] rose by a significant margin in July, expanding 7.4 percent from June on the strength of robust demand from the China mobile phone market as well as restocking efforts from Tier 1 makers of handsets and tablet PC devices, according to an HIS iSuppli SMD PriceTrak report […]," as cited in this recent release from iSuppli.
Panels in general have seen a rough year with intense competition, inventory challenges due to soft demand and the added problem of little to no ASP relief to help encourage sales. Adding to the good sector news though is that "U.S. flat-panel television prices declines slightly in August, [… with] [t]he average price [… falling] 0.4 percent […] represent[ing] the first decrease since March," according to this report from iSuppli. Of importance, this (much needed) price decline was for larger-sized TVs, which could bring some hope for the upcoming 4Q holiday sales cycle in the US, particularly since price has been shown to be a real barrier to moving product lately.
The intense competition has lead to more than just (needed) price declines; it has also lead to the departure of a major company from the DTV and Blu-ray market, Broadcom Corporation. While likely a difficult decision for Broadcom, a healthy company with a strong IC offering, today's market situation requires all companies to be extremely strategic in terms of sector and product alignment to ensure continued growth and health, likely at the core of Broadcom's decision (cf. here from EETimes, here from DisplaySearch, and here from iSuppli for more detailed commentary). As we continue to move forward through the present macro-economic situation, we are expecting other significant and strategic industry changes to occur in order to better align with the type of demand and product uses that we are seeing.
The continued high demand for the smart wireless device (SWD) sector, particularly smart- and/or feature phones and tablet PCs, have helped the sector by keeping SMD pricing in good territory. However, the increase in competition is putting downward pressure on panels at a time when market conditions, outside of the SMD space, are truly tough. Of course, all eyes are on China's upcoming Golden Week in October which tends to see spikes in consumer purchases, according to the iSuppli release.
So, while we are seeing some signs of improvement for the larger panels (TVs and monitors), we do expect that this market will undergo necessary changes to better align with demand (feature, functionality and pricing) (see this DisplaySearch report on some TFT LCD panel strategies, this DisplaySearch blog on LCD panel changes and power consumption issues, and this iSuppli report on Western TV Chip Suppliers).
Meanwhile, with the new Kindle Fire news and next week's expected unveiling of iPhone5 from Apple (see this latest bit of rumored features from PC Magazine, here from PC World, and here from cnet News), there is sure to be additional excitement in the SWD sector for smartphones and tablet PCs alike. All good news to give hopes for a growing 4Q11 (see this interesting commentary from Financial Times as to possible TV viewing changes related to device favoring – an interesting comment and thought, though while tablet viewing of streaming media is on the rise, the TV sector is more likely in a phase maturation than a replacement by alternate device stage).