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New applications speed LED market recovery

Now much less reliant on mobile phone backlighting, the market for high-brightness LEDs is bouncing back from two years of sluggish growth.

Thanks to increasing penetration in products such as digital cameras, notebook PC backlights and cars, the market for packaged high-brightness LEDs grew nearly 10 per cent in 2007 to $4.6 billion.

According to Bob Steele, whose annual update traditionally opens the Strategies in Light conference each February, the acceleration showed that the market is recovering from "slow growth" through 2004-2006.

While a staggering 39 billion units were shipped during the year (up 26 per cent on 2006), it is now clear that HB-LED makers are becoming much less reliant on the mobile phone industry.

That s good news for chip makers, because price erosion in the mobile phone sector is a major influence on the overall market, and a key reason why market growth has languished at only 6 per cent for the past couple of years.

Steele told delegates that the HB-LED product mix is shifting significantly as new, more lucrative applications come to the fore.

While mobile applications still represent a 44 per cent chunk of the overall market, digital camcorders, MP3 players and portable DVD players are pushing back the reliance on the mobile phone.

In 2007, the mobile phone market for HB-LEDs grew only 3.3 per cent. In contrast, the market for all other mobile applications jumped 21 per cent to $264 million.

Steele expects this trend to be a strong one over the next few years, predicting that by 2012 notebook PCs will represent the biggest mobile application outside of the humble phone.

That shift is already happening, judging by the large number of notebook PC makers now using LEDs in backlights. Apple, Dell, Acer and HP were four big-name brands to come out with LED-backlit models during 2007, as LED market penetration more than quadrupled to 3.2 per cent.

While the display backlight market is moving quickly, the same cannot be said of the automotive market for LEDs, which is showing a much more gradual, and somewhat stuttering shift to solid-state technology.

Despite white LED headlamps now beginning to appear (see related stories) in series production, some lighting functions have switched away from LEDs back to incandescent lamps, most notably the latest version of Honda s hugely popular Accord.

Steele is predicting more rapid growth in the "signs and displays" sector, which he says will come to dominate the overall HB-LED market by 2012.

That will depend on LCD backlighting for TVs and PC monitors making a major transition to LED technology, but with all of the major players working on LED backlight programs, this looks likely.

Korean electronics giant Samsung is setting the trend here. With three types of LED-based displays on the market, it launched five new LCD TVs with LED backlights in the second half of 2007 "“ the smallest a 40-inch model costing $2800.

Samsung uses white LEDs produced by combining GaN-based blue emitters with red and green phosphors to achieve wide color gamut "“ crucial for TV applications. Around 1000 of these are needed to illuminate a 40-inch screen, however, making it an expensive technology at a time when the competing cold-cathode fluorescent lamps are both improving in quality and declining in price.

In general lighting, 2007 witnessed a lot of new activity, particularly in Asia. While this boosted the value of this market segment by 60 per cent to $330 million, it also had a downside, with many luminaire products offering poor performance (see related story on DOE s recent tests).

At the other end of the scale, Steele praised the efforts of LED Lighting Fixtures (LLF), whose technical team has now produced a warm-white LED lamp with an efficacy of 113 lm/W. Although not yet commercial, this should be a sign of things to come.

Steele revealed that LLF uses a unique approach to create white light "“ mixing a phosphor-converted yellow-green LED emitter with light direct from red emitters.

Concluding that the slow growth period is now behind it, the analyst predicted that the HB-LED market would expand by 12 per cent in 2008, and continue to accelerate through 2012, by which time it will be worth $11.4 billion.

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