Ken Werner
Senior Analyst and Editor

In reporting its 4Q’06 results, Samsung Electronics said it sold 1.7M 40-inch LCD-TV panels (up 9% quarter-to-quarter) and 0.5M LCD-TV panels 46 inches and larger (up 51% quarter-to-quarter). LG.Philips LCD (LPL) predicted that shipments of TVs 40 inches and larger would account for 20 to 25% of the global LCD-TV market in 2007.

Samsung also cited DisplaySearch data predicting that in the 40-inch and larger flat-panel TV segment, LCD would outsell PDP for the first time. (See bar chart.)

Now, if you’re a PDP manufacturer, is this good news or bad news? Well, 37% growth in unit shipments can’t be bad, and plasma-TV makers we talked to at CES stressed that they were happily looking forward to healthy sales growth, and tried to shrug off the fact that their share of the market is decreasing. Others said that share is largely about price, that PDP gained share in 4Q on the shoulders of (truly spectacular) price reductions, and that PDP has more potential remaining for "cost-down" than does LCD, especially since the enthusiasm for every-larger LCD fabs seems to waning.

The other half of the story is the relative pricing of LCD- and PDP-TVs, and Displaybank was kind enough to supply an update of that information yesterday. (See line graph.) The ratio of the price of a 42-inch PDP-TV to a 42-inch LCD-TV rose from 71.5% in January 2006 to 78.6% in December, according to Displaybank. (The panel cost for each technology is predicted to drop roughly another 25% during 2007.) With the price gap shrinking, LCD’s share is growing.

But PDP could have some surprises in store. For instance, PDP’s prices might have dropped more if the technology hadn’t been hit by a staggering increase in the price of Ruthenium, a key ingredient in the conductive paste used for making the front-glass bus electrodes, which is the third most costly material in a PDP panel, DuPont’s Marc Doyle told Insight Media yesterday, speaking by telephone from Korea. Now, DuPont has developed a new seventh generation of its Fodel thick-film paste that cuts the Ruthenium content by 80%, Doyle said, and that will relieve some of the cost pressure on PDPs.

This story ain’t over yet.