Anne L. Fischer, Senior Editor
High-brightness LEDs are riding a growing wave because of increasing brightness and decreasing costs, according to “The Global Market for High-Brightness LEDs,” a report from NanoMarkets LC of Glen Allen, Va.
The firm forecasts an 11.6 percent compound annual growth rate from 2005 to 2013 for the sector, with predictions that it will rise from $4.13 billion in 2005 to $7.15 billion in 2010.
Mobile applications held a 52 percent share of the high-brightness LED market in 2005. Liquid crystal display backlighting camein a distant second.
Products that incorporate high-brightness LEDs include mobile phones and computers, automotive lighting, televisions and games. Over the next five years, the market will be bolstered by their use in auto headlights and in general illumination. Applications in architectural lighting, water treatment, surgical sterilization and other niche applications will drive revenue over the next decade.
Five manufacturers currently dominate the market: Cree Inc., Lumileds Lighting LLC, Nichia Corp., Osram Opto Semiconductors and Toyoda Gosei Co. Ltd. Customers trust these leaders, despite the fact that many small Asian firms can supply LEDs for prices 25 percent lower, because the quality from such competitors is perceived to be inadequate. These smaller manufacturers are trying to dispel the image of poor quality, and many in countries such as China, Taiwan and South Korea are posing a competitive threat.
Excluding Japan, Taiwan is the biggest LED manufacturing center in Asia. Some US and European companies are planning to shift their manufacturing base to Taiwan and other Asian countries to take advantage of the lower costs, the more flexible government policies and the low cost of skilled labor.
Technologically driven consolidation is taking place, with suppliers looking to fill special niches through acquisitions. Veeco Instruments Inc. is one example, having recently acquired Emcore Corp.’s TurboDisc metallorganic chemical vapor deposition technology.
OEMs, according to the report, must build stronger relationships with manufacturers of high-brightness LEDs. Manufacturers feel that they cannot be open about the technology because OEMs may copy the patented technology and turn out less expensive products.
Research and development is going full tilt to push the efficiency of white-light high-brightness LEDs past 40 lm/W at approximately 17 m/$1. Work focuses on improving the quality of white-light emission as well as on the materials systems, optical packaging and heat sinks.
As advancements increase, the LEDs will be closer to replacing incandescent lighting. The report summarizes that the market for solid-state lighting will have to be created, however, because use of the incandescent bulb is fixed in the minds of consumers. A new consumer perspective is needed, which will come about through education on the possibilities for high-brightness LEDs.
The report was published in November and is available in several versions, starting at $2495. More information is available at www.nanomarkets.net.