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Crystal Clear LCD Growth At Corning

Post Time:Jun 12,2008Classify:Company NewsView:294

 

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Old-school television sets are going the way of rotary telephones, and Corning is poised to reap the benefits.

The technology manufacturer expects that the global market for liquid crystal display (LCD) glass used for flat screen televisions will grow by between 25.0% and 30.0% in 2008.

On Wednesday the president of the Corning, N.Y.-based company's display technologies business segment, Alan Eusden, reiterated Chief Executive

Corning (nyse: GLW -

Corning manufactures the glass which is used for everything from LCD flat screen TVs to laptop and desktop monitor screens to the screens used for PDAs like Research In Motion's (nasdaq: RIMM -

Retail sales of LCD televisions remain strong on a global level, the company said, and haven't suffered a slowdown—neither in the United States nor in the global market—as other consumer goods have in recent months, resulting from the current economic downturn.

There is much room for it to grow. A Corning spokesperson said LCD penetration on a worldwide basis was just under 8.0%. Of the 1.9 billion TV's installed around the globe, just 152 million of those had LCD screens, as opposed to the older cathode ray tube, or CRT models.

More and more people have been replacing older TV sets with flat-screen models, which has hugely benefited the LCD market. In 2006, the total LCD glass market was 1.2 billion square feet. In 2008, Corning expects that number to reach 2.2 billion square feet, or 500 million square feet per year of growth.

Corning reported that in North America, year-over-year LCD TV unit sales grew 30% in January; 54% in February; 37% in March; and 34% in April.

Laptops make up half of all computers sold, Corning said, and as a growing market it is also good for the LCD screen maker. But it's not growing at as rapid a percentage rate as the flat screen TV market because the "installed base" is already large. In other words, computers tend not to have as long a shelf life as televisions have, so while many people have already swapped older computer monitors for flat screen upgrades, the market for new flat screen TVs is still taking off.

New consumer purchases of LCD computer monitors are likely just replacements for older LCD screens. New consumer purchases of LCD TVs add to the installed LCD TV base on the global market.

Further growth opportunity exists for the global LCD market, and in turn for Corning, as flat screen TVs are far thinner, easier to transport and take up less space, so many consumers are putting more TVs in their homes than ever before. And as the consumer market in emerging economies, such as China, continue to develop, increasingly more people worldwide possess the disposable incomes necessary to make large electronic purchases.

Shares in Corning, which has a $41.8 billion

Source: www.forbes.comAuthor: admin

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