Tablet goldrush will not lead to panel shortage

More and more companies are jumping on the tablet PC bandwagon, following the herd in a bid to stay on top of competition. Tablet PC shipments were about 16 million units in 2010, and market sources expect them to increase 3.5-5 fold in 2011.

Bob Raikes an analyst at Meko told TechEye: “I liked the quote I saw from CES, which went, “These companies are like six-year-olds on a soccer team. The ball goes over here, and they all run after it in a blob. Tablet!?? Tablet!? Tablet!?”

AU Optronics has announced that it began shipping a small volume of tablet PC panels in the last quarter of 2010 in preparation for a huge kick. It now claims that it has begun mass volume shipments with touch panel features in the first quarter of 2011.

Paul Peng, executive vice president of AUO, said that the company’s tablet PC panel shipments will focus on providing a complete range of a high-resolution, wide-viewing-angle TFT-LCD panel with an in-house touch feature. AUO’s 4G line has started producing touch sensors, and about half of the capacity at the 4G line will be used for touch sensors. AUO also plans to transform its 5G line for touch panel production in the future.

RIM is putting its foot firmly in the industry, announcing that production of its PlayBook tablet PCs at Quanta’s plant in Taiwan have reached an economic scale of 150,000-200,000 a month with shipments to be ready as early as February.

Bob Raikes reckons the trend won’t be bucked any time soon: “Up to now, most LCDs have either been in the up to 5” category (smartphones and other phones, GPS’s. Digital camera displays and camcorders) or 10″ – 12″ and up – notebooks, monitors and TVs.”

Apple set the bar very high on the iPad by using IPS technology to give good viewing angle performance, which is better than typical notebook or netbook displays, and capacitive touch technology, which was only used in high volume on phone displays.

“To meet the huge demand from everybody that wants to make tablets, LCD makers are having to make sure they have high quality, mid-sized displays with capacitive touch, so there is lots of ‘juggling’ of production and capacity going on,” he added.

He said however, overall, there should not be a shortage. But there may be for particular sizes or technologies.

Talking to TechEye, Ms. Rhoda Alexander, director of monitor research at iSuppli, says: “All of the leading LCD panel vendors are engaged in touch panel development, either already producing integrated panels or still in the research stage.

“With media tablets and smartphones shaping up as two of the fastest growing consumer electronic markets over the next few years, panel manufacturers are looking to expand their business opportunities and streamline the manufacturing process by incorporating touch integration into the panel production process. Demand for projected capacitive (PC) touch is expected to outstrip supply in 2011, with independent touch manufacturers best positioned to meet the initial supply needs.

“However, the end-device market (media tablets) is likely to experience some market saturation, with a select group of well-positioned vendors positioned to capitalize on the market opportunity with the right combination of hardware, interface, content, and pricing, while many of the initial offerings end up in the bargain sale bins.”