Insight’s Daily Outlook

Every weekday morning, Insight Media’s Steve Sechrist and Ken Werner have a conference call with Jamie Townsend and Alex Hamilton of IM’s financial analysis partner, Townhall Proprietary Research. We screen the news of the display and consumer electronics industries, and we figure out what matters and how to use it. We do this to help in our editorial process and to support Townhall’s analysis on the financial impact of the news. Now, we’re sharing those insights with a wider community.

Our goal is to simply – and very briefly – tell you what we think is interesting or important from today’s headlines. This is your opportunity to see how we look at events each day and how we judge their impact. It is your chance to get an early jump-start on an important event – with a little guidance from the experts at Insight Media.

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Ken Werner
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kwerner@insightmedia.info

Component Shortages Limit LCD Sales

by Ken Werner

Ken Werner
Senior Analyst and Editor
of Insight Media's Display Watch

December 13, 2005 - Reports and projections of LCD component shortages – particularly cold-cathode fluorescent lamps (CCFLs) for backlights and matrix color filters – have been circulating for months. But, recently, the reports are becoming both wide-spread and specific. AUO, while announcing record monthly earnings for November, cited CCFL shortages has a main reason why the results were less than 1% better than October’s. And one Korean manufacturer was reported to have have its shipments constrained by an improbably large percentage due to CCFL shortages. Further CCFL shortages were reported to varying degrees by Taiwan manufacturers, as well, with monitor lines being less affected than TV and notebook lines, and companies with Taiwan sources of supply less affected than those dependent on Japanese sources. Meanwhile, CCFL makers are adding manufacturing lines at a rapid rate, but shortages are predicted to last at least into Q2, and perhaps into Q3 or later.

CCFLs aren’t the only problem. Allied Material Technology Corporation (AMTC) says Gen 5 and Gen 6 color filters will be in short supply throughout 2006. AUO, Taiwan’s largest LCD manufacturer and the third largest in the world, has protected itself by signing a five-year contract for Gen 5 color filters – that’s half the capacity of AMTC’s new Gen 5 color-filter plant. (The other half is going to Japan’s Toppan CFI.)

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Insight Media (www.insightmedia.info) provides a full array of market research, news, analysis and consulting services for the display industry, with special attention to projection products. Tracking the complete supply chain from components to finished products and the distribution channels, Insight Media follows technologies, markets, business and trends in displays and display-related application markets. Broad coverage is offered through our newsletters and conferences with in-depth analysis available via our reports and consulting services. Insight Media has a world-class team of industry analysts and associates to provide comprehensive coverage and analysis of the display industry.

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