Abstract
LCD panel makers are aiming to create synergy by integrating key components in their operations. This has created a trend among these makers to invest in LCD driver IC companies. LCD driver IC companies without investments from panel makers are therefore facing considerable challenges. Also, prices of panel modules are falling, causing profit performances to fall. Therefore, these companies are looking for new product opportunities, and this is a major reason for Novatek's recent acquisition of Cheertek. Furthermore, in the current industry environment, it is critical for IC makers to develop integrated chipsets to maintain competitiveness, and this has been another driving factor behind the acquisition. This report will analyze Novatek's acquisition, and will look at future development trends among TV and multimedia IC makers.
Novatek Eyeing New Applications Such as iDTV and Digital Photo Frame
Currently, competition in the LCD driver IC and controller IC markets is very intense, causing makers' profits to fall. Integrating technologies such as digital TV reception and MPEG with its capabilities including LCD driver IC, TCON, and LCD controller IC will help Novatek to move into areas such as iDTV, digital photo frames, and portable television. Possessing both front-end and back-end technologies will be beneficial for Novatek in a sense that its market development will not be limited to panel makers.
Integrated Chipset Solutions Becoming Mainstream
In the past Taiwanese chip makers used their expertise in one specific technology and their cost-down capabilities to gain market share, but this strategy does not hold anymore in the current industry environment. TV and peripheral A/V product IC markets have become fiercely competitive. Besides moving towards higher-end technologies and products, the integration of multiple chips has gradually become a mainstream trend.
Taiwanese chip makers, which in the past focused on specific segments -such as MTK which focused on the DVD segment and Realtek which focused on the DSL modem segment -have upgraded their technologies or made acquisitions to push their front-end and back-end development. The goal of these strategies is to open up new markets, and create more diverse product solutions.
With makers integrating front-end and back-end items, integrated chipsets (SoC) and modularized solutions are becoming more prevalent. Furthermore, IC makers focusing on one technology are no longer able to attract clients of satisfy their demand, and providing varied and integrated chipset solutions will be a mainstream market trend in the future.
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Figure 2 |
Major Taiwanese TV and Multimedia IC Makers' Development |
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Source: respective companies, compiled by MIC, December 2007 |