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Competition, Excess Manufacturing Capability and Lack of Investment on New Optoelectronics Projects, Says Frost & Sullivan
November 20, 2003 |Estimated reading time: 1 minute
Palo Alto, Calif. — New analysis from Frost & Sullivan, World Optoelectronics Market, reveals that this industry generated revenues totaling $4.23 billion in 2002. Total market revenues are expected to reach $7.22 billion in 2009.
Lack of capacity utilization, price constraints, and reduced volumes are greatly impacting the profitability of optoelectronic component manufacturers, Frost & Sullivan said..
As rapidly expanding communication technologies drive higher bandwidths and increased speed of communication products, manufacturers of optoelectronic components are under pressure to enhance the speed of the devices as well as the bandwidth they can support.
Another trend in the industry is toward lower package dimensions to help reduce the size of products. Higher budgets are required to design and test newer packages without affecting the speed of the optoelectronic device.
However, customers are not willing to pay a higher price for improved technology and vendors are being compelled to cut costs without compromising on quality.
The increasing brightness and range of colors in light emitting diodes (LEDs) offers new market opportunities for manufacturers that keep pace with the technology. The latest blue and blue-green LEDs are already finding applications in signboards, car interiors, car backlights, and medical electronics and related applications.
In other segments, the convergence of computers, communications and consumer electronics is driving demand for optocoupler devices while photodetectors are likely to do well in the medical device market. High-end telecommunications products, office automation, and peripheral devices are expected to push laser diode sales.Since the cost of consumables, replacement of machine parts, labor wage, defect trends and increased process yield requirements are forcing even small and mediocre manufacturers to adapt to a higher automated process, concentrating on lower turn around times can create higher volumes and help vendors increase their market share.
World Optoelectronics Market, a part of the Total Industrial Subscription, explores the predominant trends in optoelectronic device markets including LEDs, optocouplers, photodetectors and laser diodes. The study examines various industry challenges and provides strategic recommendations for the benefit of the manufacturers.