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Lighting to overtake cellphones as largest LED driver IC sector
With the efficiency and total lumen output for light emitting diodes (LED) on the rise, lighting this year will surpass cellphones as the biggest application for LED driver ICs, with revenue rising by more than 50 percent annually, and then more than doubling by 2018.
The market for LED driver ICs in LED lighting is set to grow to $323 million this year, up from $214 million in 2012, according to a new report from IMS Research, now part of IHS Inc. This will allow the LED market for lighting to exceed that of cellphones, which will have revenue of $316 million. Unit shipments of LED driver ICs this year will continue to favor mobile handsets with 1.5 billion units, versus 1.1 billion for LED lighting. However, that will change in 2014 when lighting is forecast to overtake mobile as the volume shipment leader with 1.9 billion, compared to 1.7 billion for cellphone LEDs. Revenue will continue to grow for LED lighting for the next few years heading to $519 million in 2014 and $666 million in 2015 on its way to $810.3 million by 2018. For years, LEDs have been known more for backlighting than for lighting, illuminating displays rather than places. However, LEDs now have come out from behind the screen and are gaining acceptance for lighting homes and businesses. Even when a number of LEDs are used in a single bulb, they can save a significant amount of energy compared to compact fluorescent bulbs. Types of lighting applications for LEDs are flashlights, street/parking lights, residential or office lights and commercial (e.g. retail, hotels). As they have become more efficient and their overall lumen output has increased, LED lights are becoming an increasingly attractive option. This is particularly true in applications where maintenance costs can be an issue, such as supermarket refrigerator lights or factory and warehouse high bay lighting. Mobile still important While lighting will overtake cellphones as the No. 1 segment beginning this year, LEDs in mobile handsets will continue to be an important segment for manufacturers. LEDs are used in mobile phones for display and keypad backlighting. More recently, LEDs have been adopted by phone manufacturers for flash photography capabilities, which will drive shipments to 2.2 billion units by 2018, up from 1.3 billion in 2012. Demand for LEDs in mobile handsets is being somewhat dampened by the rise of organic light emitting diode (OLED) displays—which do not require a LED for backlighting. OLEDs are replacing liquid crystal display (LCD) screens in some smartphones, resulting in slower market growth. The percentage of total LED driver IC revenue derived from cellphones will decline to 20 percent by 2018, down from 27 percent in 2012. Because of this, LED driver IC manufacturers whose core market is mobile handsets have been diversifying into other areas such as lighting and some new entrants are only focused on lighting. Vehicle LEDs Automotive is one of the fast-growing markets for LED driver ICs for both the interior and exterior of vehicles. Interior automotive LEDs are used in LCD display backlighting as well as for navigation displays, infotainment and instrument clusters. Other applications inside vehicles include ambient lighting, reading lighting, footwell lighting and boot/truck lighting. One of the major applications for LEDs on the exterior of cars includes rear and brake lights powered by LED driver chips. While sometimes only one LED driver is needed to power multiple rear lights, IHS believes there will be a large increase in LED driver IC use for years to come driven by the increasing use of LED driver ICs and the rising penetration of LEDs in cars.
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