Three major logics for the future growth of the LED display market

Due to factors such as government budget, price competition, and technological competition, the demand for LED display screens in the domestic market is expected to be average in 2024. However, the overseas market continues to grow, with stable development in the European and American markets, and good performance in the Asia Pacific region (especially Southeast Asia and the Middle East). In the long run, the LED display market will continue to maintain growth, with the main growth logic including:

1. Expanding from developed economies to underdeveloped economies. China is the global manufacturing base for LED displays and also the birthplace of LED displays. The first stage of China's market development towards developed economies overseas has been completed. With the continuous reduction of LED display costs, the market has entered the second stage and will continue to expand to underdeveloped economies.

2. Expand from government and large corporate clients to small and medium-sized clients. After more than 20 years of development, the price of the LED display industry has continued to decline, the customer base has gradually expanded, and the market is moving from to G to to B, with the possibility of expanding to C in the future.

From the perspective of manufacturers, the proportion of distribution and sales models has been continuously increasing in recent years, and the demand for channel based LED display screens has begun to grow. Manufacturers are also actively adjusting their business strategies, laying out channel markets, and establishing distribution systems in China and globally to cover a wider customer base.

3. Expand from traditional applications to emerging applications. Traditional applications mainly include enterprise meetings, security monitoring, retail exhibitions, public areas, transportation, and outdoor advertising. With the emergence of Micro/Mini LED technology, the application scenarios of LED displays continue to increase, such as LED all-in-one machines, virtual shooting, and cinemas/home theaters, and there is still significant growth space in the future.

Overall, TrendForce predicts that the global LED display market size will reach $7.516 billion (+2.8% YoY) by 2024, and is expected to increase to $10.2 billion by 2028, with a compound annual growth rate of 7% from 2023 to 2028.

The prospects for emerging LED applications such as all-in-one machines, virtual filming, and cinemas are promising

In recent years, the development of LED technology in emerging application fields has attracted discussions and attention from many professionals in the display industry.

In terms of LED all-in-one machines, the market concentration is relatively high, and with more and more manufacturers joining, the price and cost are gradually decreasing. According to TrendForce Consulting data, from 2020 to 2024, the compound annual growth rate of LED all-in-one machine shipments will reach 31%. With further price declines, the shipment volume of LED all-in-one machines is expected to continue to grow.

In terms of specifications, LED all-in-one machines are developing towards the 2K 16:9 format of 135-146 inches. The 21:9 ratio is becoming increasingly popular in video conferences, while the demand for the 32:9 ratio is gradually increasing in speech hall applications in the European and American markets.

In terms of virtual filming, although the market size may decline in 2023 due to the impact of the "Hollywood Strike" in North America, the market growth trend is still positive in the long run. The application of virtual filming is not limited to film production, but has also expanded to fields such as advertising, TV dramas, and variety shows, attracting more manufacturers to participate. At present, the industry concentration in this field is relatively high.

In terms of product specifications, the mainstream specifications for virtual shooting background display are concentrated in P2.1 and above, such as P2.3, P2.6, and P2.8. For advanced film and television shooting, due to the requirements for brightness and display effect, Mini LED displays with P1.2-P1.6 are usually used. With the decrease in cost, the improvement in specifications will also greatly enhance the effect of virtual shooting.

In terms of cinemas, currently there are only about 160 LED movie screens installed worldwide, and their applications are not yet widespread. However, the market potential is huge in the future and is expected to experience explosive growth. However, LED displays still face technical challenges in terms of heat dissipation, power consumption, uneven brightness, bad pixels, cost, and color consistency during maintenance, which urgently need to be overcome.

In addition, with the decline in the price of LED displays, the popularity of the rental market continues to increase, and more on-site events are adopting LED rental displays to create cooler visual effects. In combination with the trend of concert filmization, the specifications of LED rental display screens are also constantly improving. TrendForce predicts that rental screens will show a steady growth trend in the future.

The competitive landscape of the LED display industry has become apparent, and the layout of industrial chain companies is accelerating

In this market context, for manufacturers in the future, developing products with advantages or layouts that are in line with the company's development will face some technological and market competition challenges.

From the chip perspective, Micro/Mini LED display chips will show a rapid growth trend, with an expected CAGR of 78% from 2023 to 2028. Some manufacturers have significantly expanded their production, and the competition for production capacity among manufacturers has intensified. As more and more manufacturers enter this field, most of them are simultaneously laying out RGB chip products, which will intensify competition among major manufacturers.

In terms of packaging technology, the competition for COB/SMD/MiP technology routes is becoming increasingly fierce. It is expected that Mini LED COB production capacity will continue to grow rapidly by 2024, reaching 57600 square meters per month by the end of the year, with a compound annual growth rate of 64% from 2022 to 2024. At the same time, the shipment volume of MiP packaged products has also achieved rapid growth, and more and more manufacturers are starting to launch flip chip discrete devices.

In terms of driver ICs, the market size has continued to decline since its peak in 2021, and price competition has become increasingly fierce. Despite the high concentration of the LED display industry, the problem of homogenization still exists, leading to a continuous decline in product prices.

In terms of display screen manufacturers, although the concentration of the LED display industry has been slowly increasing, the prospects of Micro/Mini LED have attracted a large amount of capital to enter. In the future, enterprises will mainly compete in regional markets, channel construction, and product layout.