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LCD Prices To Climb = No Lower Price iMac In Near Future

post #1 of 5
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Price hikes promised by LCD drought
Sat Feb 23,10:43 AM ET

By Richard Shim, ZDNet News

A worldwide shortage of a key component in making LCDs is likely to lead to a price increase of popular tech products, according to a report from research firm Provizio.

Flat-panel display manufacturers, which use LCDs (liquid-crystal displays), have been expecting shortages since the beginning of the year, but Boise, Idaho-based Provizio said in a report released Friday that the shortfall may also affect other markets.

The inadequate supply of motherglass--the large panel that certain displays, such as LCDs, are cut from--will probably lead to shortages and increased prices for notebooks, handheld devices and cell phones.

The motherglass shortage could last into 2003, Provizio Chief Executive Tim Rhodes said.

"We saw the same sort of thing happen in 1999 when there was a shortage that hung over into 2000, and production ramped up and there was an oversupply in 2001," Rhodes said. "This year, we'll see a shortage and a slow recovery in 2003."

The shortage is the result of the popularity for products with LCD displays, including notebooks, televisions and handhelds. In January of 2000, global demand was for 600,000 square meters of motherglass; it increased to 810,000 square meters by the end of that year, Rhodes said. Demand for motherglass has been growing 10 percent each month since December 2000.

Motherglass manufacturers were not prepared for the demand, which added to the shortage, Rhodes said. Some of the big players have not decided if they are going to build new factories, and it takes about two years for new manufacturing plants to be ready to produce, according to Rhodes.

PC makers, such as Dell Computer and Apple Computer, have been heavily promoting the space- and energy-saving aspects of flat-panel screens.

The closing of an NH Techno Glass plant, which supplies about 10 percent of the worldwide demand for motherglass, will also hurt supply. The company's customers include LCD producers Fujitsu, Samsung Electronics, International Display Technology, Chi Mei Optoeletronics and HannStar Display.

Companies to most likely feel the effects of the worldwide shortage include ViewSonic, Samsung, Sharp, Reptron Electronics, Jaco Electronics, Phillips, Corning, NEC-Mitsubishi Electronic Display, Toshiba, and Matsushita Electric, Rhodes said.
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post #2 of 5
ive heard this before.. i really dont see LCD prices actually raising. I see them just leveling off and staying at current price range.
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PowerMac B&W G3 400
640MB Ram
2x 30gig IBM Deskstar 7,200 rpm
2x 17' Viewsonic Flatscreen
OS 9.2.2 & 10.1
Digidesign ProTools
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post #3 of 5
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Demand for LCD's is more than supply available. That means prices creeping up during the rest of the year. Prices have already gone up since late last year. They are definately not leveling off. Other technologies for flat panel screens are in the works, but since they are new they will be more expensive at first.
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post #4 of 5
LCD makers have been planning this shortage for a while now. I think Apple going from Air Freight to ship would probably almost offset the increased LCD prices.
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post #5 of 5
Thread Starter 
LCD makers cannot get a very important part for their assembly of screens. According to the article above sufficent supplies will not be on hand until 2003. Therefore, LCD screens will not meet the increasing demand, which means in the real world, shortages and/or increases in price. Apple will indeed increase their profit margins on the new iMac when they no longer need to ship air. But that will not happen until late April or early June. To meet the current backlog they will continue to ship air freight. They indicated this at the analyist meeting. They also said at that meeting that LCD prices had started to increase but their price structure took that into account.
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