Large LCD Panel Makers See the Green in Going Green
Motivation Goes from Environmentalism to Capitalism
No longer just a buzz word to get Hollywood types and beatniks to sprout about clear air and clean water, the phrase 'going green' has become a serious consideration in the electronics industry that sees not only strong public demand, but a potential opportunity for robust growth.
Beyond just solar panels or more fuel efficient automobiles, the green movement has spread as far as the large Liquid Crystal Display (LCD) panel market, where suppliers are making progress in their environmental efforts.
Sweta Dash, senior director of LCD research at iSuppli Corp., sat down to discuss what exactly is happening in the large-sized LCD panel industry in terms of reducing its carbon footprint and adopting green technologies.
iSuppli: The large LCD panel definitely is going green. Can you tell us a bit about what industry players are doing to become more environmentally friendly?
Sweta Dash: "LCD suppliers are working at the product-design level as well as at the manufacturing level to bring green solutions to the industry. At the product level, they are working on reducing hazardous or objectionable materials to meet environmental regulations, changing backlight designs or materials to mitigate power consumption and also producing thinner and lighter products that reduce packaging materials and maximize transportation efficiency. At the production or manufacturing level, they are building 'Eco' facilities—developing processes with low environmental impacts such as using more recycled materials, saving more water and energy in the production process and working to reduce carbon emissions."
iSuppli: Why do LCD panel makers feel like this? Do they feel this is something that needs to be done now?
Dash: "With global warming and higher energy costs, there is a general trend toward green initiatives, which may impact consumer buying decisions in the future. Plus, more and more government regulations in different countries are requiring electronic products to meet their environmental regulations and panel suppliers must act proactively to meet current as well as future requirements that may be coming into the market. Also, with the increased use of LCD-based electronics products—especially LCD-TVs—panel suppliers feel the pressure to reduce power consumption to make their products more eco-friendly."
iSuppli: Using Light Emitting Diode (LED) backlights that are mercury free is obviously a great way to be more environmentally friendly compared to employing Cold Cathode Fluorescent Lamps (CCFLs), which contain mercury. But they are still higher in price. Are vendors willing to eat the extra cost?
Dash: "Yes, LED backlights generally are higher priced than CCFLs, but as we have seen in the notebook market, the gap has declined substantially with increased production and improved supply chain efficiency. Also, often a supply/demand balance forces suppliers to sell products at a lower price. Recently, we have seen LED and CCFL panel prices for notebooks equaling those of similar-sized panels, although the cost may be higher. This actually helped increase adoption rates. With increased demand, panel suppliers are starting to charge more for LED-based panels compared to those using CCFLs. Sometimes, suppliers are forced to take a hit in the profit margins initially to increase adoption rates."
iSuppli: And at the point where LEDs reach cost parity with CCFLs, widespread adoption is a no-brainer?
Dash: "Yes, that is what we are starting to see in the notebook market. Many brand manufacturers and panel suppliers are planning to have 100 percent of their notebook panels shift to LED backlights by the end of 2011. Also, with the launch of Intel’s Consumer Ultra Low Voltage (CULV) processor, the adoption rate is expected to be very strong. Furthermore, LED backlights will reduce power consumption by 30 percent to 35 percent. They also can reduce panel weight by 30 percent compared to CCFLs. Panel thickness can be reduced 40 percent to 45 percent compared to CCFLs. So LED-based products are not only environmental friendly they are thinner, lighter and sleeker. We are starting to see more products with LED backlights for TV and monitors. Some TV brand manufacturers are starting to introduce several models with, thinner, lighter and lower-power LED backlit TVs. For LED-TVs, the power savings can be as high as 30 percent to 60 percent, with LED backlights depending on types of LED and backlight design. Panel suppliers already are reducing the number of CCFLs in the monitors from four to two. In the process, they are aiming to reduce power consumption by 30 percent to 60 percent.
iSuppli: Are the LCD panel makers and LED manufacturers doing anything to accelerate the arrival of cost parity?
Dash: "More and more panel suppliers are investing or entering partnerships with LED suppliers to increase production and to reduce costs. They want more control over the supply and the supply chain to reduce costs and to increase efficiency."
iSuppli: In terms of enabling power savings, lowering hazardous substances and other innovations, are there
associated costs here as well?
Dash: "I think using new manufacturing processes will have initial associated costs. But by saving energy or by recycling more, suppliers can reduce long-term costs."
iSuppli: Again, is this something that panel makers want to do because it is something they see as better for the environment or are they getting pulled in that direction because the world in general is more aware of environmental concerns?
Dash: "Some of the initiative is due to the need to meet different environmental regulations. But others are more voluntary and some suppliers see it as good for environment and also good for business, especially as consumers are becoming more aware of it and some may pay a slightly higher price for it. Also more and more countries have aggressive targets for reducing greenhouse gas emissions. They have proposals that will enforce tough standards for energy efficiency for consumer products especially for televisions. Suppliers need to redesign now to meet those future requirements."
iSuppli: Is 'going green' a way for panel manufacturers, in the long run, to save money? And in turn, will it boost profit margins?
Dash: "Yes. In product design, by using less CCFLs, or by employing LEDs and making panels thinner and lighter will save costs and increase profit. Some of the savings in cost and profit margin may not be apparent or possible in the short term, but it is better for the long term."
iSuppli: And if that is the case, I would imagine the incentive, beyond just cleaning up the environment, is more tangible?
Dash: "Definitely, many panel suppliers are planning to make going green part of their DNA. But for the LCD industry, a shift to green will be part of evolution of the product and will contribute to demand creation and help profit margins in future."
No longer just a buzz word to get Hollywood types and beatniks to sprout about clear air and clean water, the phrase 'going green' has become a serious consideration in the electronics industry that sees not only strong public demand, but a potential opportunity for robust growth.
Beyond just solar panels or more fuel efficient automobiles, the green movement has spread as far as the large Liquid Crystal Display (LCD) panel market, where suppliers are making progress in their environmental efforts.
Sweta Dash, senior director of LCD research at iSuppli Corp., sat down to discuss what exactly is happening in the large-sized LCD panel industry in terms of reducing its carbon footprint and adopting green technologies.
iSuppli: The large LCD panel definitely is going green. Can you tell us a bit about what industry players are doing to become more environmentally friendly?
Sweta Dash: "LCD suppliers are working at the product-design level as well as at the manufacturing level to bring green solutions to the industry. At the product level, they are working on reducing hazardous or objectionable materials to meet environmental regulations, changing backlight designs or materials to mitigate power consumption and also producing thinner and lighter products that reduce packaging materials and maximize transportation efficiency. At the production or manufacturing level, they are building 'Eco' facilities—developing processes with low environmental impacts such as using more recycled materials, saving more water and energy in the production process and working to reduce carbon emissions."
iSuppli: Why do LCD panel makers feel like this? Do they feel this is something that needs to be done now?
Dash: "With global warming and higher energy costs, there is a general trend toward green initiatives, which may impact consumer buying decisions in the future. Plus, more and more government regulations in different countries are requiring electronic products to meet their environmental regulations and panel suppliers must act proactively to meet current as well as future requirements that may be coming into the market. Also, with the increased use of LCD-based electronics products—especially LCD-TVs—panel suppliers feel the pressure to reduce power consumption to make their products more eco-friendly."
iSuppli: Using Light Emitting Diode (LED) backlights that are mercury free is obviously a great way to be more environmentally friendly compared to employing Cold Cathode Fluorescent Lamps (CCFLs), which contain mercury. But they are still higher in price. Are vendors willing to eat the extra cost?
Dash: "Yes, LED backlights generally are higher priced than CCFLs, but as we have seen in the notebook market, the gap has declined substantially with increased production and improved supply chain efficiency. Also, often a supply/demand balance forces suppliers to sell products at a lower price. Recently, we have seen LED and CCFL panel prices for notebooks equaling those of similar-sized panels, although the cost may be higher. This actually helped increase adoption rates. With increased demand, panel suppliers are starting to charge more for LED-based panels compared to those using CCFLs. Sometimes, suppliers are forced to take a hit in the profit margins initially to increase adoption rates."
iSuppli: And at the point where LEDs reach cost parity with CCFLs, widespread adoption is a no-brainer?
Dash: "Yes, that is what we are starting to see in the notebook market. Many brand manufacturers and panel suppliers are planning to have 100 percent of their notebook panels shift to LED backlights by the end of 2011. Also, with the launch of Intel’s Consumer Ultra Low Voltage (CULV) processor, the adoption rate is expected to be very strong. Furthermore, LED backlights will reduce power consumption by 30 percent to 35 percent. They also can reduce panel weight by 30 percent compared to CCFLs. Panel thickness can be reduced 40 percent to 45 percent compared to CCFLs. So LED-based products are not only environmental friendly they are thinner, lighter and sleeker. We are starting to see more products with LED backlights for TV and monitors. Some TV brand manufacturers are starting to introduce several models with, thinner, lighter and lower-power LED backlit TVs. For LED-TVs, the power savings can be as high as 30 percent to 60 percent, with LED backlights depending on types of LED and backlight design. Panel suppliers already are reducing the number of CCFLs in the monitors from four to two. In the process, they are aiming to reduce power consumption by 30 percent to 60 percent.
iSuppli: Are the LCD panel makers and LED manufacturers doing anything to accelerate the arrival of cost parity?
Dash: "More and more panel suppliers are investing or entering partnerships with LED suppliers to increase production and to reduce costs. They want more control over the supply and the supply chain to reduce costs and to increase efficiency."
iSuppli: In terms of enabling power savings, lowering hazardous substances and other innovations, are there
associated costs here as well?
Dash: "I think using new manufacturing processes will have initial associated costs. But by saving energy or by recycling more, suppliers can reduce long-term costs."
iSuppli: Again, is this something that panel makers want to do because it is something they see as better for the environment or are they getting pulled in that direction because the world in general is more aware of environmental concerns?
Dash: "Some of the initiative is due to the need to meet different environmental regulations. But others are more voluntary and some suppliers see it as good for environment and also good for business, especially as consumers are becoming more aware of it and some may pay a slightly higher price for it. Also more and more countries have aggressive targets for reducing greenhouse gas emissions. They have proposals that will enforce tough standards for energy efficiency for consumer products especially for televisions. Suppliers need to redesign now to meet those future requirements."
iSuppli: Is 'going green' a way for panel manufacturers, in the long run, to save money? And in turn, will it boost profit margins?
Dash: "Yes. In product design, by using less CCFLs, or by employing LEDs and making panels thinner and lighter will save costs and increase profit. Some of the savings in cost and profit margin may not be apparent or possible in the short term, but it is better for the long term."
iSuppli: And if that is the case, I would imagine the incentive, beyond just cleaning up the environment, is more tangible?
Dash: "Definitely, many panel suppliers are planning to make going green part of their DNA. But for the LCD industry, a shift to green will be part of evolution of the product and will contribute to demand creation and help profit margins in future."
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