The market research company IMS Research forecasts that the market for semiconductors in backlighting applications (including LEDs, LED-associated driver integrated circuits and ambient light sensors) will grow from just under $3 billion in 2006 to around $4.5 billion by 2012.

This growth comes from LED backlighting expanding from small displays, where it has been used for some time, to the medium- and large-size screens used in LCD televisions and PC notebooks, for example. This shift to larger displays is important because, as advancing technology produces brighter LEDs and more efficient lightguides, fewer LEDs likely will be required for small displays.

The market growth for small displays is fragmented by application; however, the company forecasts that overall revenues for small displays will increase until 2008 and then fall slowly, primarily because of saturation in the cellular handset market.

The company expects that the increase in LED use in large screens will stall growth for cold-cathode fluorescent lamps; however, fluorescent lamp manufacturers likely will push back with new technology and will try to lower prices to remain competitive.

LEDs are expected to account for around two-thirds of the semiconductors in the backlighting applications market in 2012 because strong growth is anticipated in the LED driver integrated circuit and ambient light sensor segments of the market.

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