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Cellphone LCDs to dominate display production this year

Value of phone display production to exceed notebook screen value in Q4 2000

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LCD manufacturers will increasingly shift production from notebook screens to cellphone displays, with balance of production favouring the latter by the end of the year, according to Japanese research company Nikkei Market Access (NMA). "There is a possibility that the LCD production value for mobile phones will exceed that for notebook PCs in the fourth quarter of 2000," said NMA's Mayumi Amagai recently. In Q1 1997, NMA reckons, the monthly value of the LCD business was split $682 million for notebook screen production to $259 million for mobile phone LCDs. By Q1 1999, that ratio had shifted to $446 million to $398 million. Since then, notebook LCD production has started to grow again, but Amagai believes it will plateau during 2000, leaving the ratio at $804 million to $827 million. The rapid growth of the cellphone LCD business should come as no surprise, not should the changes in the value of the notebook screen market. The slowdown through 1997 and 1998, broadly follows the improving yields on passive matrix screens, and the 1999 growth ties in with the improvements in the production of active matrix (aka TFT) screens, now the standard for notebook PCs. In the meantime, the cellphone market has grown and grown. However, that growth does highlight the fears of some vendors, most notably Palm and Nintendo, who have both warned of hardware production problems resulting from manufacturers' attempting to cope with the massive demand for mobile phones LCDs. In Palm's case, that means component shortages, leading to reduced sales and a profit warning for the company's next two quarters. Nintendo, meanwhile, said this week that it may have to delay the introduction of its next Gameboy because of LCD supply issues. Amagai also noted that notebook production reached just under 18 million units in 1999 and that the figure will have risen to 22 million by the end of this year. That contrasts with the 270 million cellphones made in 1999, which will rise to 400 million this year. ® Related Stories Nintendo Gameboy delay confirms Palm profit fears Palm profits surpass Street 'spectations LCDs hit by component shortage

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