One year is a long time in the channel. Roughly 12 months ago, monitor vendors were gazing longingly at TFT (thin film transistor) technology and desperately trying to secure stock to incorporate these new flat screens into the offerings. However, the tide was against them. A raft of new technologies, especially camcorders and mobile phones, were soaking up any slack and making it impossible to secure supply. While a few vertical markets, most of them cashed up and desperately short on space, bought into the skinny offerings, most end users were scared away by the price. Vendors did their best to talk up the benefits of the new technology and the market recorded some impressive growth. But most resellers were locked out of the game.
These days, TFT factories all over Asia
are breaking the stranglehold a few major manufacturers had on the market. Economies of scale and competition have come into play and forced prices downward. In fact, many former CRT plants have been converted to TFT LCD plants as manufacturers move to take advantage of the new market.
According to Ruben Tan, hardware analyst with International Data Corporation (IDC), resellers should brace themselves for a massive shift towards TFT technology. Tan believes Australia is currently lagging behind in TFT uptake because of a generally flat market. However, given falling prices, he believes the sluggish sales will not last long.
"We have been looking at some phenomenal growth lately, but TFT sales are still only a small part of the overall market place," Tan said. "It was practically negligible in Q3 of last year, then it doubled in Q4 and doubled again."
Tan points out the constant shift towards LCD production is leading to a significant glut in the market place which will drive prices still lower.
"I would not want to be in the manufacturers' shoes at the moment. It doesn't look like the prices will stop falling any time soon."
Increased vendor competition has made some significant changes to the market. Jeff Li, purchasing director at distributor Pioneer Computers Australia, points out that over the past 12 months pricing on TFT LCD screens has been halved, while the number of brands available in Australia has doubled.
"We are currently running about 13 different brands of TFT LCD monitor because a lot of the monitor manufacturers have simply switched away from CRT manufacture," Li said. "They know they won't be able to sell CRT monitors anymore."
Rudie Hoess, managing director at Camcom International, believes the diversification of manufacturers has led to improvements in functionality generally as well as improvements in price.
"One of the major drawbacks of the TFT LCD monitor was that the display panel is soft to touch and difficult to clean. However, they are now coming protected with a fine pane of glass," Hoess said. "Not only do some of the new models look good, they also have new cable arrangements and more freedom for design innovation. They can be wall-mounted or arm-mounted. Some are also selling as multifunction devices, offering TV, DVD and video displays at the flick of a remote control."
If international markets are any indication, the changeover from CRT to LCD-based sales will not take long. Luis Gonzales, corporate account manager at distributor Chips, points out other markets have already taken to the offerings.
"I recently attended a vendor conference in Taipei where I spoke to some guys from the UK and found out they are already selling more LCD than CRT monitors," Gonzales said. "LCD is a good thing for some of the smart resellers because prices are falling so fast and they are not under any pressure to start pricing wars. If they work smart, they will be able to make a good profit over and above a standard margin."
Manufacturers should take heart. Although a number of different factors have turned last year's shortages into an oversupply, end users are ready and willing to respond to the call - as long as the price is right.
The thrust towards LCD monitors is coming from both sides of the market. Recognising this, PC vendors such as Apple are making the TFT LCD monitors increasingly prevalent in their branded line-up.
Apple is sufficiently convinced of the end-user migration toward TFT LCD displays. It has taken the decision to migrate all its add-on monitors to the thin footprint format.
Myrna Van Pelt, corporate affairs manager for Apple Computer, is quick to pick up on the kudos of being first to market with such a move.
"This won't affect our iMac models which will continue with the built-in CRT display. However, all our attachable monitors have been migrated to the TFT LCD model," Van Pelt said. "Our main drivers are our customers. Their requirements fit perfectly with the TFT LCD provisions."
While Van Pelt cites radiation and the flicker-free picture as the main driving factors, she believes resellers should be taking advantage of the "look" of the monitors in order to ramp up sales.
"The benefit of a clean-looking display are significant, especially at the point of sale," Van Pelt said.
Pioneer Computers' Li is adamant
the switch to TFT LCD screens can only benefit the channel.
"Resellers are more likely to sell something that is more attractive. The CRTs have no margins and no future so they aren't worth your time anyway," Li said. "TFT LCD monitors are a little more expensive. But if you explain it to the customer, they will know what they are paying for."
A bundle of opportunity
While some early attempts at TFT LCD bundled PCs failed due to pricing structures, many distributors are now suggesting resellers review bundling possibilities as prices have now fallen to a more competitive level.
"Prices have fallen by almost half since the beginning of the year. We are now seeing the 15-inch monitors at a price which challenges the CRT models," said Gonzales. "There were a few attempts to bundle LCDs with other offerings at the beginning of the year but that has largely come to an end because the pricing wasn't right. Now is the time to try something like that again."
More than just a pretty face
New gadgets invariably offer sales based on "sex appeal". However TFT LCD monitors not only look good, they have some important benefits that make them ideal for most office and home applications.
- They do not emit magnetic fields - and therefore do not interfere with other recording equipment.
- They are flicker free - significantly cutting down on visual fatigue.
- They are slim-line - creating significant savings in terms of desktop real estate.
- They do not attract fine dust particles - cutting down on allergens circulating in the environment.
- They use less electricity - creating power and heat emission savings, significant in the corporate environment.
Despite the benefits and the improvements in technology over the past decade, IDC's Tan believes there will be a market for CRT displays amongst very high-end graphic users.
"TFT LCD technology is perfect for most office applications where resolution is not so critical, but people are staring at the screen for long periods every day," Tan said. "Yet the technology still does not offer high enough resolution for people involved in graphics."
Paradoxically TFT LCD screens, which up until now have been relegated to the very high end of the market due to price, may ultimately be considered the lower grade offering, while CRTs take their place at the high end.
"The high-end, prestige CRTs will hold out. If you have the money for the quality that is what people will end up buying," Tan said. Although, he points out, most patterns of computer usage are more suited to LCD displays.