Samsung adds to LCD optimism
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Samsung is aggressively investing in flat screen production.
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SEOUL, South Korea (Reuters) -- Samsung Electronics says flat panel prices will remain strong in the first half of 2004 and revenues will rise 40 percent next year, given tight supply and soaring demand.
The industry is expected to boom in the next couple of years as flat screen televisions, which now cost thousands of dollars each, come down in price with the introduction of major production capacity, mostly in Korea and Taiwan.
"We don't expect LCD prices to go down below current levels as short supply is likely to continue," Yeongduk Cho, vice president of the South Korean firm's liquid crystal display (LCD) flat panel division, told a news conference Thursday
Cho expected its sales of LCD panels to top $7 billion next year versus $5.1 billion revenues estimated for this year.
LCD operations accounted for 10 percent of the company's third quarter sales revenue.
The forecast came after AU Optronics Corp, Taiwan's top flat screen maker, said on Wednesday its sales would grow 50 percent in 2004 on strong demand for notebook computers and monitors.
"I don't see a reason for prices to go down and any oversupply of flat panels is likely to be absorbed by the TV market," Cho said.
Global display makers are investing more than $26 billion in new plants that promise to cut LCD costs sharply by using larger plates of glass to make displays and to meet rising demand for thin TVs.
They are betting TVs as thin as a picture frame will prove as popular as flat computer screens. The anticipated upgrade from traditional cathode-ray boxes will be the biggest change in TV technology since the switch from black and white.
Samsung, the world's second-largest flat panel maker, unveiled on Thursday a 57-inch (145 cm) flat high-definition TV. The new product, which Samsung claims is the world's biggest, is 4.75 cm (1.9 inch) thick and weighs 21.5 kg (47.4 llb).
Samsung is the most aggressive investor in flat screens at the moment. It announced a 20 trillion spending plan for the next 10 years and agreed a $2 billion deal with Japan's Sony Corp to boost production of flat panel screens and try to make it easier for its product to become a industry standard.
Executives and analysts believe LCD TV production will double next year to between eight and 10 million sets from about four million in 2003 and less than one million in 2002. Those numbers are still relatively small for a worldwide TV market where annual sales number about 150 million units.
Shares in Samsung, Asia's most valuable technology stock with a market value of $61 billion, are down about 0.3 percent to 453,500 won, mirroring the fall in the broad market .
Copyright 2003
Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
