China's display market presents three major characteristics to maintain low growth

The latest "China Monitor Market Quarterly Tracking Report" released by IDC shows that in the first half of 2010 (Jan-June), China's display market shipments reached 21.47 million units, an increase of 12% compared with the same period last year. .

For the relatively saturated PC monitor market, the 12% growth rate is already a good result. In response, Ms. Huo Jinjie, vice president of research at IDC Asia Pacific, explained that by further carefully interpreting the 12% figure, we can find some market change information behind the figures. First, the source of growth in the display market in the first half of this year came from the bundled sales market of PC monitors. According to IDC data, the year-on-year growth rate of the bundling market reached 26%, while that of the non-bundled market was still less than 4%. In other words, the good performance of the PC desktop market in the first half of the year has partly obscured the fact that the unbundling market is weak. Second, in the first quarter of 2009, the entire market was still under the influence of the economic crisis, which led to a year-on-year growth rate in the first half of this year. Ms. Huo Jinjie believes that for a market with a high degree of sophistication, technology switching and intensive cultivation have become the main theme of market competition.

Chen Mei and Zhang Wei, analysts responsible for display market research at IDC China, believe that throughout the first half of 2010, the Chinese display market presents the following characteristics:

1. LED displays quickly occupy the market

After the 16:9 widescreen display has occupied the dominant position in the market, both manufacturers and channels have shifted their sales focus to LED displays. IDC data show that as of the second quarter of 2010, the market share of LED displays has reached 6.8%, and is still showing a rapid rise. As a new technology, LED displays not only save energy costs, but also have the advantages of high contrast and high quality picture. Such displays have gained high praise in the consumer market and have gradually gained popularity. In terms of price, the price difference between small-size LED displays and LCDs is almost the same, and the spread of large-size ones is also greatly reduced. These positive factors will further promote the development of LED displays.

2. Insufficient market demand led to oversupply of panels, and the price of end markets generally declined

In the first half of 2010, the pace of development of the Chinese display market slowed down. Except for government and school and other industries, procurement was still large, and the demand for consumer markets was obviously insufficient. The display was hit by the all-in-one and laptops, and consumer confidence caused by the slowdown in China’s economic development slowed down. Consumers’ enthusiasm for purchasing monitors was low. This directly led to the oversupply of panel makers, and all manufacturers and channels are also faced with a huge dilemma of inventory. In this case, substantial price reductions have become a market strategy for manufacturers to effectively digest inventory and expand sales. IDC predicts that such price decline will continue until the second half of 2010. In spite of this, due to the large number of LED products and touch screen products, the prices of large-screen displays have been falling relatively slowly.

3. Manufacturers actively adjust channels to respond to fierce market competition

In the face of severe market conditions, major manufacturers are actively looking for marketing strategies that suit them, in order to win more market opportunities in the increasingly fierce competition. Philips is a successful model of channel transformation. Since the transformation of its own sales channels, sales volume and market share have increased significantly. In turn, Acer began a large-scale channel transformation in 2010 in order to deepen the consumer market. IDC believes that Acer’s influence in the consumer market will be further strengthened after the channel system is streamlined.

IDC predicts that the overall market size of China's displays in 2010 is expected to reach 44.09 million units, and the annual growth rate will be around 10%, of which the fourth quarter will become a more critical quarter in the second half of the year. In the coming years, the Chinese display market will maintain low growth.