Strategically Blogging

China Pricing War II

Martin Shih 11/17/2014

We recently took a trip to China to interview top manufacturers of LED components for our upcoming China Quarterly Updates Report. According to these major LED players, we are convinced that several LED trends we predicted in my blog at the beginning of this year did and are continuing to happen.

The Dental Laser Market Needs A Filling

Allen Nogee 10/31/2014

It was just 14 years ago when a group of dental professionals came together to form the World Clinical Laser Institute. This group was formed to promote and share their ideas and experiences and to advance dental care through the use of lasers. Today, the WCLI is the largest group of dental professionals supporting the use of lasers in dentistry; with 19,000 members, the use of lasers by the dental profession has not grown as fast as many had expected. Today, in the US, roughly 7% of all dentists use lasers, which means that 93% of dentists don’t. Of the four medical laser segments we track (cosmetic, ophthalmic, surgical, and dental), the dental area is growing the slowest.

Integrated vs. Non-Integrated Luminaires

Shonika Vijay 10/30/2014

As time goes on, it is becoming more and more apparent that LED lighting will soon take over. With the current ban of 40W through 100W incandescent light bulbs and the dropping prices of LED lighting, it is no surprise that LED lighting is the lighting of the present and will be lighting of the future. However, LED lighting was first, or in some cases still is, introduced into the market to replicate the incumbent technology so that consumers don’t get scared away by a lighting system that they can’t associate with their old one. What I mean here is that having a fixture where the consumer can physically take out the lamp and replace it if it burns out. Today, there seems to be plenty of interest in fixtures/luminaires where the lamp could be replaced.

When Will OLEDs be the Next Big Thing in Lighting?

Stephanie Pruitt 10/08/2014

OLEDs have been gaining in popularity lately, mainly in displays, but also more recently in general lighting. They offer many benefits over traditional and LED lighting, including being a surface emitting light source (as opposed to point emitting), being extremely thin, and having the capability to be flexible and even transparent. OLEDs open the doors to really innovative and creative light forms that were previously not possible with traditional lighting. However, they still have a ways to go in efficacy, lumen output, and price compared to their less expensive inorganic counterparts that are still struggling to really penetrate into the market.

Shonika Vijay

High-End Lighting Markets for Solid State Lighting

Shonika Vijay 09/30/2014

Lighting has always been seen as a commodity market. In fact, most people buy their light bulbs from the same place they buy their milk. It is a price war out there with slim profit margins on lighting products; meanwhile, the market keeps demanding higher quality. The general indoor lighting market mostly consists of the following form factors: downlights, troffers, suspended pendants, track lights, and high bay lights (a detailed market report of general lighting luminaires with these form factors along with all technologies will be released this November). Downlights and troffers make up the majority of the installed luminaire base for all regions. In order to compete for penetration in these installed luminaire bases, LED lighting has had to slash its prices while making sure it can sustain the light output levels of halogens, incandescent, and fluorescent technologies.

Some thawing in the opto end markets?

By Tom Hausken
There are signs that some markets for optoelectronic products are thawing a little bit. Foundries in Taiwan have hired back workers. Large-area flat panel display production in Taiwan was up in March over the previous month. Sales of flat panel TVs and video recorders were up in Japan . Memory chip prices are up and Samsung, for one, expects improving demand for memory chips this quarter. Hon Hai, a major contract manufacturer, is hiring in Taiwan, China, and the Czech Republic, with expansion plans in Mexico, Turkey, Russia, and elsewhere. Even equipment supplier EV Group announced that it will add a shift to accommodate demand for through-silicon via (TSV) and nanolithography tools. Compound semiconductor supplier Triquint has also announced a bounce as inventory burns off.

At the least, this is an indication that inventories are now worked out of the supply chain. But, it's interesting that a lot of the news comes from one place: Taiwan.

Dominique Numakura of DKN Research Group notes several reasons for Taiwan's thaw in his recent newsletter . First, it's based on two successful products that are emerging now, just as the recession hurts sales for just about everything else. Those products are the netbook computer and the smart phone. Another reason is that spillover of demand from mainland China's stimulus package has driven up demand for large screen TVs supplied from Taiwan. Numakura also suggests that Taiwan has a more urgent and proactive approach to the downturn, more aggressively seeking out opportunities than Japanese and American counterparts that take a more reactionary approach.

It helps to note too that the semiconductor downturn dates all the way to 2007 already, so improvement is well overdue.

Any thawing will be good news for anyone making optoelectronic chips for common appliances: things like image sensors, displays, LEDs, etc.

There is still plenty of bad news coming out every day. For example, iSuppli doesn't buy the hype about a memory chip recovery, arguing that the supply will still exceed the growth in demand. And for the most part, the demand for fab tools and other manufacturing equipment remains frozen solid. But the chip demand has to improve before anything else can.

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