Today's LCD TVs may be a lot better than sets from a few years ago, but there's plenty of room for improvement

Today's LCD TVs may be a lot better than sets from a few years ago, but there's plenty of room for improvement. At DisplaySearch's U.S. Flat Panel Display conference yesterday, component makers talked about new equipment, glass, and films all designed to make flat-panel displays better and less expensive.

Charles Annis, vice president of manufacturing research for DisplaySearch, said that a year ago there was a huge drop in profitability among the panel makers because they invested so much in new capacity, but were then hit with the recession. But this year, based on growing demand, particularly in China, the industry has seen a significant recovery.

According to Annis, strong demand is projected for the next few years, and panel makers are reacting by building new fabrication plants. On the technology front, he said, there's a lot of work being done on "high transmission" manufacturing. This allows for higher contrast ratio (related to the move towards LED backlighting), new color filter technology to improve color reproduction, and technology that will enable easier manufacturing of 240Hz.

Annis said that LED backlighting in TVs is expected to grow from 3 percent of the market in 2009 to 20 percent this year; by 2016, essentially all LCD TVs will use LED backlights. He noted that there had been a glass shortage for part of 2009, but it has improved this year.

Annis also noted that while Sharp now has a Gen 10 factories, and others are expected to follow, most of the investment is in Gen 8 and Gen 6 factories.

Bruce Berkoff, chief marketing officer for displays at Applied Materials, predicts much higher growth in the display industry than the DisplaySearch analysts, driven by new applications from tablets to larger TVs. There has been a 20-times cost reduction per area in LCD manufacturing over the past 15 years; and by 2015, the number of TVs sold could top 400 million, he said. That's nearly twice the number sold this year, and it's spurred by the growth of the middle class in emerging markets.

Get the rest of this post on PCMag's Forward Thinking blog.