In North America, the shift to widescreen models is becoming extremely evident. While the market only grew 2% sequentially, 266% of its sequential growth was attributed to increased shipments of widescreen models.

The LCD monitor market rose significantly higher in the third quarter of 2006 than originally expected, jumping 16.3% sequentially and 21.9% on year to 34.6 million units shipped worldwide.

This marks an all time quarterly high in LCD monitor shipments, as the ever-resilient desktop display market moves from a "CRT vs LCD" market to a "widescreen LCD vs standard LCD" market.

Worldwide revenues for LCD monitor shipments also grew sequentially, rising 7.4% in the third quarter above US$9.4 billion, but were only up 1.1% on year. LCD monitor pricing continues to erode in all major sizes in recent quarters and vendors are reaching new aggressive price points on widescreen displays to accelerate this market.

Tied to the transition to widescreen displays is continued growth of LCD monitor shipments into emerging markets. Greater China's sequential growth rate was 23%; the shipment of widescreen displays accounted for 69.9% of that growth. Demand also returned to the EMEA region (Europe, Middle East and Africa). The North American region witnessed disappointing growth in the quarter: only 2%. This was due mainly to a sequential decline in shipments from the regional market leader Dell, which maintained a dominant regional share of 33.9% (versus Hewlett-Packard at 12.6%), while seeing its shipments decrease 5.1% for the quarter for the region.

In North America, the shift to widescreen models is becoming extremely evident. While the market only grew 2% sequentially, 266% of its sequential growth was attributed to increased shipments of widescreen models. Traditionally strong sizes such as the 17-inch SXGA category (with a commanding 46.3% share) remained relatively flat with the second and third sizes in ranking, 19-inch SXGA and 15-inch XGA, actually dropping 10.3% and 8.4% sequentially. Many major vendors have dropped out of the 15-inch XGA monitor category all together in the North America market, and the 19-inch widescreen segment is expected to out-ship 15-inch XGA monitors in both the North American market as well as the total worldwide market for the first time in the fourth quarter of 2006.

In EMEA, growth came through increased shipments of the two most popular sizes: 17-inch SXGA (with a 52.7% share) grew 27% for the quarter and 19-inch SXGA (with a 32.6% share) shipments rose 39% sequentially. These two sizes together have an 85.3% share of shipments into EMEA. Shipments of 19-inch widescreen shipments outpaced those for 15-inch XGA models for the first time (making 19-inch widescreen the number three size/resolution in this region), giving indications that this region is also shifting to widescreen models.

Unlike other regions such as North America and EMEA that are now in replacement cycles, China is growing on an absolute basis with first time buyers in both the corporate and the consumer segments. As first time buyers, this market is clearly selecting wide displays with market penetration of widescreen monitor shipments into this region already reaching 20.6% as of the third quarter of 2006. Much of this growth is driven by Lenovo and their strong bundles. Lenovo enjoyed the top market share position in China in the period with a 21.5% share, but saw an even greater share in the exploding widescreen segment with a 40.2% share, 27% above the second widescreen monitor player in the region, Acer.

On a worldwide brand basis, Dell remained the market share leader with shipments down 3% sequentially. Stand-alone vendors like Samsung, Acer, LG Electronics (LGE) and ViewSonic fared much better as users are migrating to peripheral companies for widescreen displays. System vendors like Dell and HP remain strong because same-brand monitors are usually purchased with new PCs, but companies that have their monitor purchases tied strictly to the purchase of a PC are finding it difficult to capture "stand-alone" monitor sales despite having strong product lines.

DisplaySearch's outlook for widescreen displays has increased significantly, with panel suppliers and brands being bullish on a quick transition, especially in consumer markets. While worldwide penetration rates for widescreen displays are forecast to only be 11% in 2006, it is forecast to jump to 31.6% in 2007. The biggest wild card is corporate adoption rates for the new widescreen displays, which some vendors do not expect until businesses migrate to the Vista operating system (OS). Historically, major corporations have waited one to 1.5 years after the release of a new OS before transitioning across the enterprise, although companies from Dell to Microsoft have indicated that they believe B2B adoption rates of the new OS will happen much quicker than in previous upgrade cycles.

Source: DisplaySearch