TAIWAN: Moderate but steady growth in LED market

Diodes are widely used in the semiconductor industry. Among the different kinds of diodes available in the market today, Taiwan vendors are focusing on light emitting diodes (LED). The high demand for LEDs is driven by Taiwan’s booming notebook and portable device market. According to the Industrial Technology Research Institute, Taiwan’s LED market revenue is estimated to grow from $1,706 million in 2007 to $3,149 million in 2010 (see Figure).



In the global market, Japan is the leading supplier of LED, followed by Taiwan. According to Topology Research, Japan took 40.5 percent of the world’s LED market share in 2006, while Taiwan took 22.1 percent. Despite being the no. two leading LED supplier in the world, only one Taiwan manufacturer, Lite-O Technology Corp., made it to the top six LED suppliers. According to Topology Research, this points out that the production capacity of many Taiwan vendors still lags behind that of MNCs.

CLUSTER EFFECT

“Taiwan’s LED market will continue to grow in scale. Local players need to build alliances with major handset, PC notebook, and LCD panel makers in the island,” said Jeffery Su, a research analyst of Merrill Lynch Taiwan. “Collaboration among companies, which I call the ‘cluster effect,’ will reinforce Taiwan’s LED supply chain,” he added. In terms of technology, customers’ key requirements are power saving features, environmental protection and compliance, and reduced sizes.



The LED industry chain is composed of upstream products like epitaxial wafers, medium-stream products like chips, and down-stream products like packaging, modular design and manufacture, the design and manufacture of lighting, etc. The LED packaging segment is extremely competitive.



“We forecast a major structural shift to occur in Taiwan’s LED industry over the next few years. The value addition will shift away from downstream LED packagers toward upstream chip suppliers. This evolution will be similar to the trend previously witnessed in the semiconductor and TFT-LCD sectors,” said Su. “Bigger LED packaging vendors have more resources both in development and production. And since this structural shift will be won by whoever has the bigger production scale and market share, the big manufacturers will get bigger.”



LED PACKAGING

One of the major players in LED packaging is Lite-On Technology. The company recently inked a cross license agreement with Osram Opto Semiconductors to manufacture white LEDs with indium gallium nitride (InGaN) process. Lit-On’s other product offerings include surface mount (SMD) LEDs, high bright full-color RGB LEDs, low-profile chip LEDs, and long-life power LEDs. Its high bright full-color RGB LED package can be assembled to many specifications of high color gamut LCD backlight. This RGB LED package features a top view six-lead PLCC package, high brightness, efficiency up to 65lm/W, and low Rth down to 15°C/W.



Meanwhile, its low-profile chip LED is available in a variety of colors and features both space and power savings over conventional chip LEDs. The company boasts of its 0402 chip LED, which features the smallest COB package that saves 60 percent space compared to the 0603 chip LED. The C199 chip LED, on the other hand, features the thinnest 0603 COB package in the market.



Lite-On’s power LED solutions provide savings on maintenance expenses and power consumption, featuring lifespan of up to 100,000 hours. Offered efficiency is up to 100lm/W, outperforming most commercial light sources.

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