Rising prices cause blip on LCD screens

Desktop panels hit by high prices and slow spending

After finally making it into the mainstream market, desktop LCD panels in Europe have been hit by high prices and slow spending.

The slowdown in the PC market has affected both CRT and desktop LCD display sales in the first half of this year, according to European monitor market research specialist Meko.

The firm's latest DisplayCast reports claimed that European desktop monitor market volume dropped by almost 21 per cent quarter-on-quarter and by two per cent over the past year.

As the PC market has shifted to using LCD display panels, CRT monitor sales shrank by 20 per cent over the year. The rising cost of LCD displays during the first half of this year resulted in sales dropping sequentially for the first time.

In Europe there were 1.9 million shipments of LCD displays in Q1, down 15.9 per cent on the same period in 2001. Despite the quarterly drop off, year-on-year sales were up 130 per cent on last year, a figure that reflects the popularity of the technology, Meko claimed.

"Underlying these top-level trends, we noticed that in some countries the LCD share of the market by volume also declined," said Bob Raikes, Meko's managing director and head of market research.

"For example, in France, Spain and the UK, the penetration rate went down quarter-on-quarter. In places where the adoption rate has historically been high, such as Switzerland, we saw a marked slowdown in the growth of the LCD sector."

Rising prices have hurt the 15in display segment most, with sales down more than 18 per cent sequentially. Meko pointed out that LCD panel makers in the Far East have begun to produce larger screen sizes to keep average selling prices and margins as high as possible.

Grant Keenan, business manager at distributor Computer 2000, confirmed that flat panels are really starting to sell well in the corporate arena.

Although the 15in offering is shifting in the greatest volumes at the moment, he claimed that sales of 17in screens will take off over the next two years.