LCD Monitor Shipments Defy Downturn in 2009

Despite the twin challenges of a global recession and dwindling desktop PC sales, unit shipments of LCD monitors increased by 3.8 percent in 2009, a far better result than vendors expected in the dark days of January 2009, according to iSuppli Corp.

Global LCD monitor shipments rose to 176.5 million units in 2009, up from 170.1 million in 2008, as presented in the attached figure. The rise in numbers was in marked contrast to a 15.9 percent plunge in the shipments of desktop PCs for the year.

“Some of the growth in LCD monitors is attributable to cannibalization of the remaining CRT monitor base as well as to cutthroat pricing,” said Rhoda Alexander, director of monitors and sustainable displays at iSuppli. “However, innovation also played a major role in spurring an increase, with vendors reinventing monitor products and luring users by offering something a little bit different.”

Innovation will become more critical in 2010 and beyond, added Alexander, as vendors strive to hitch their monitors to a portion of the runaway mobile PC growth while still serving their traditional base—the desktop computer users. iSuppli forecasts that LCD monitor shipments will grow to 211.5 million units by 2013, rising at a Compound Annual Growth Rate (CAGR) of 4.5 percent from 2008.

Given that businesses reduced headcount and slashed equipment expenditures as part of their overall cost-cutting efforts, consumer demand was actually stronger than corporate demand for monitors through most of the downturn. The mix is shifting, however, from 2010 on, with business customers expected to play an increasingly important role.

Factors driving monitor growth in business markets
According to Alexander, three primary drivers will play a factor in monitor growth in business markets moving forward: improved connectivity, job growth and operating-system shifts.

On the connectivity front, the growing use of multiple displays in business environments is playing a significant role, particularly for mobile users, who frequently utilize a secondary display in a desktop setting. To date, most of the secondary usage has been accomplished through a straight connection to available VGA, DVI or USB ports on the system or through a docking station. The USB option and DisplayPort 1.2 have the benefit of allowing users to daisy chain one monitor to another, avoiding the limitations of available ports on the PC. In addition, DisplayPort 1.2 is expected to take a significant role in driving multiple monitor usage in corporate environments, particularly for mobile platforms.

As a second driving factor for monitor growth, the recovery of job markets—albeit slowly— means that monitors will be an increasingly important part of total system purchases for new hires who require additional equipment. Already, Asian markets have started to increase hiring, with North America expected to follow later this year or early 2011, and Europe expected to turn the tide within the next two years.

A third area of growth for monitors lies with the introduction of new operating systems, which tend to drive new equipment purchases for systems and monitors alike. Although monitor vendors were disappointed by the abysmal adoption rates of Microsoft Corp.’s Vista in the corporate market, the adoption path for Windows 7 appears more promising—especially given Microsoft’s announced intention to cease ongoing support of the XP operating system in 2010. The incorporation of touch into Windows 7 also opens a host of new possibilities for applications as well as a potential new market for touch-driven displays.

Consumer markets—keeping it fun
Consumer markets—particularly younger users who tend to employ their mobile devices as display systems—represent a much bigger challenge to monitor vendors than business environments. Yet, attractive pricing and the lure of ever-bigger screens helped to drive monitor sales in 2009, despite the rapid shift to mobile platforms.

In addition, the move to 16:9-format offerings helped stimulate some of the consumer monitor growth in 2009, offering users a Full High-Definition (HD) experience. Vendors are likewise introducing monitors with slim LED backlights as environmentally friendly solutions—once again changing the message and providing something “new,” a key to driving further demand in consumer markets.

“Expect to see a flurry of 3D offerings in 2010, as monitor vendors capitalize on the 3D growth opportunity,” said Alexander. “Monitors, with their overall lower cost point, offer a more affordable initial 3D experience for many users than a large-screen TV. With expanding 3D game choices, a 3D monitor is likely to be one of the 'must have' holiday gifts of 2010.”

The role of all-in-ones
For those looking to obtain a fixed solution but wanting a more compact package, vendors have introduced a wealth of affordable all-in-one solutions—the PC all but invisible behind the monitor screen. Representing approximately 5 percent of the monitor market sales in 2009, all-in-ones will account for 9 percent or more in 2010—straddling business and consumer markets, with usage growing in each.

Finally, touch is playing an important role in the growth of the all-in-one business, offering a more user-friendly interface for select business usage and toddlers alike. Through the incorporation of collapsible stands, ergonomic difficulties can be easily surmounted, allowing the display to recline to a more horizontal position when using the touch option.

iSuppli