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Booming tablet shipments—including the iPad with its 9-inch screen, as well as smaller 7.x-inch models from various brands—will drive a robust 56 percent annual increase in shipments for the tablet display market in 2012, according to the IHS iSuppli Small and Medium Displays Service from information and analytics provider IHS.
Shipments of tablet displays this year are projected to reach 126.6 million units, up from 82.1 million units in 2011, as presented in the figure attached.
“Media tablets increasingly are becoming the biggest growth driver in the market for the small and medium display market,” said Vinita Jakhanwal, director for Small & Medium Displays at IHS. “While the 9-inch segment dominated by the iPad will account for the majority of tablet display shipments this year, the fastest-growing portion of the market will the 7.x-inch screens used in products like the Galaxy Tab from Samsung Electronics, the Kindle Fire from Amazon, the Nook Tablet from Barnes & Noble, and other tablet products using the Google Android operating system.”
Approximately 74.3 million units, or 59 percent of all tablet display panel shipments, will come from the 9.x-inch segment, of which the iPad is the uncontested leader. Growth in the 9.x-inch tablet panel sector this year is forecast to rise 35 percent from 55.2 million units in 2011.
The second-largest size segment for tablet displays this year will be the 7.x-inch. Shipments of the 7.x-inch tablet display in 2012 will amount to 41.1 million units, nearly double from 20.8 million units last year.
This means the 7.x-inch category will control 32 percent of the tablet display space in 2012, compared to 26 percent in 2011.
The 9.x-inch sector this year is giving up some market share. And while it will continue to lead the tablet panel space this year, the 7.x-inch category will be helped by the launch of lower-priced tablets in that size segment, along with what is widely believed will be a product offering from Apple later this year for a smaller iPad.
The rest of the tablet display market in 2012 will be divided between the 8.x-inch size, with approximately 9 percent share; and the 5.x-inch, with less than 1 percent share.
Tablet displays dim slightly in Q2
Shipments for tablet displays declined by 20 percent sequentially in the first quarter due to seasonal trends, with tablet device makers trying to flush out a significant amount of inventory that had built up in the fourth quarter of 2011 in light of slower consumer demand. Tablet panel shipments grew, however, in the second quarter—the result of inventories getting cleared, and of panel orders coming in for the new tablet launches planned for the second half of the year. Total tablet panel shipments in the second quarter reached 27 million units, up nearly 30 percent from 21 million units in the first quarter.
LG and Samsung dominate tablet display shipments
LG Display and Samsung Display were the main suppliers of tablet displays in the first quarter with 42 percent and 38 percent shipment market share, respectively. Both are market leaders because they make the liquid crystal display (LCD) panels that are used in the iPad, which continued to dominate the media tablet space with a commanding 58 percent of all tablets shipped in the first quarter.
Aside from supplying Apple, LGD also furnishes display panels to Amazon and Barnes & Noble, while Samsung provides panels to its internal tablet division. Investments are being made by the two major tablet panel suppliers in capacity allocation and technological improvements to supply high-performance tablet panels and to develop wide-viewing-angle technologies like in-plane switching (IPS) and fringe-field switching (FFS). Both LGD and Samsung Display are also looking to convert amorphous-silicon fabs into making oxide silicon panels to help improve tablet panel resolution, power consumption and overall performance.
Panel manufacturers enter the tablet panel fray
Other LCD panel suppliers also are jumping into the fast-growing tablet market. In particular, Japanese suppliers such as Sharp, Japan Display and Panasonic are actively targeting the tablet panel market by dedicating capacity at their Generation 6 and Generation 8 fabs in order to make tablet panels.
Together the capacity allocation this year for small and medium displays by the Japanese is expected to increase 164 percent from last year’s levels, reaching 5.5 million square meters in 2012. Of particular interest is the oxide silicon capacity at Sharp, which has been supplying panels from its G8 fab for the latest iteration of the iPad—also called the new iPad. Another company, Panasonic, is likely to produce 7.x-inch and 8.x-inch tablet panels during the second half of this year.
For their part, LCD suppliers based in Taiwan, such as AU Optronics and ChiMei Innolux, reportedly are adjusting their business models—some to focus on tablets for the education sector, and others to supply tablets for the white-box market in China.
It is believed that AUO may be one of the suppliers qualified to supply the smaller iPad’s 7.85-in panels.
But unlike Tier 1 tablet display makers LGD and Samsung Display, Taiwanese panel suppliers primarily target the Chinese market that is geared more toward lower-priced tablets. To meet lower price points, display specifications are usually dialed down compared to Tier 1 products. Displays targeted at the white-box tablet market in China mainly employ the more basic twisted nematic (TN) LCD, not the wide-viewing-angle LCD technologies of IPS and FFS.
Regardless of the display technology and market segment, display suppliers are making sure they align their strategies to serve this fast-growing market.
About IHS (www.ihs.com)
IHS (NYSE: IHS) is the leading source of information and insight in critical areas that shape today’s business landscape, including energy and power; design and supply chain; defense, risk and security; environmental, health and safety (EHS) and sustainability; country and industry forecasting; and commodities, pricing and cost. Businesses and governments around the globe rely on the comprehensive content, expert independent analysis and flexible delivery methods of IHS to make high-impact decisions and develop strategies with speed and confidence. IHS has been in business since 1959 and became a publicly traded company on the New York Stock Exchange in 2005. Headquartered in Englewood, Colorado, USA, IHS employs more than 6,000 people in more than 30 countries around the world.
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