TV Industry Faces Massive LED Shortage

According to a new report from the iSuppli research firm,  the television industry will soon experience “an acute undersupply” of LEDs, the solid-state lighting source used in LCD TVs to create superior video imagery compared to standard LCD TVs, which use fluorescent lamps.The problem is particularly affecting the TV industry, which uses many more LED modules than in computer monitors. While notebook computer screens typically use 50 LEDs, an LCD TV needs between 300 and 500 per panel, all of which must create a uniform level of brightness.

The popularity of LED-backlit LCD TVs is creating the shortage. LED consumption rose from 57 billion units in 2008 to 63 billion units in 2009. Current industry capacity is 75 billion units, which means that new LED fabrication plants must be built if prices are not to rise. If that doesn’t occur, iSuppli predicts that there will be a “drastic undersupply” of LEDs this year.

The company expects LED shipments to move from 63 billion this year, to 104 billion in 2011, and then to 166 billion in 2013 or almost triple the shipments of last year.

To solve the supply problem, television manufacturers are looking for ways to reduce the number of LEDs used in each LCD TV, and to bring production in-house to better control availability.

But until they’re successful, don’t expect to see a rapid decline in retail prices for LED-backlit LCD TVs, at least in the short term.