LCD DDI shipments to fall over the next three years

Global revenue from sales of Display Driver ICs (DDI) will decline in the next three quarters due to a range of different factors according to iSuppli.

DDIs are semiconductors that provide the voltage or drive signals for LCD as well as for Organic Light Emitting Diode (OLED) and plasma displays. Large panels also account for 60 percent of total DDI market revenue.

In its research iSuppli said that the DDI market will drop as rising inventory, slowing consumer demand and technological innovation “conspire to cause a deceleration in shipments.”

It said that whilst DDI revenue rose steadily during the first two quarters of 2010, the industry would experience the opposite for the last two quarters of the year, as well as for the first quarter of 2011. Starting from $1.63 billion in the second quarter, DDI revenue will dip to $1.59 billion in the third quarter, slide further to $1.51 in the fourth quarter, and then take a dive to $1.36 billion in the first quarter of 2011. iSuppli said that by then, DDI revenue will have fallen a hefty 16.2 percent compared to the second quarter of 2010.

And it gets worse with the company claiming that the DDI market will be buffeted by continuous cost-down measures from an industry that’s intent on slashing losses, as well as by projected declines in the Average Selling Price from 2010 to 2014. It said that developments  will further exacerbate revenue woes. As a result, the industry’s five-year Compound Annual Growth Rate beginning 2009 is expected to decline 5.2 percent to $4.2 billion, iSuppli semiconductor market research indicates.

Randy Lawson, manager and principal analyst for display and consumer electronics at iSuppli, said: “Despite continued growth in the global LCD market, concerns over inventory build-up and slipping consumer confidence in the Western hemisphere will work to slow order rates for DDI components during the next three quarters.

 “Rising unit shipments of panels in applications including LCD-TVs and netbooks will not translate into stable growth for the large-panel DDI sector.”