- New Trends of LED Package: Move from Backlighting to General Lighting
Currently, the largest LED package market sector is backlighting, accounting for almost half of the global LED package market in 2011. While the size of the backlighting LED package market is shrinking due to LED penetration approaching saturation levels and swifter LED price erosion, value is shifting towards the emerging LED market in general lighting. The size of the LED package market in general lighting is expected to exceed that of backlighting from 2013.
Many backlighting players are entering the general lighting market to compensate for the anticipated decline in backlighting business ahead. However, faster price reduction of LED packages will likely also cap the future growth of the general lighting LED package market. Expetys' calculations show that LED package market growth in general lighting is expected to be around 25 percent p.a. from 2011 to 2016, and will then slow down to approximately 7 percent p.a. from 2016 to 2020. This is much slower than overall LED general lighting market growth, which is predicted to be around 45 and 15 percent p.a., respectively.
Many LED backlighting players are starting to expand into the general lighting downstream arena, i.e., the retrofit lamp and fixtures business.Traditional lamp players have for example been acquiring fixtures players and even expanding into lighting control systems to capture the newly emerging business opportunities described in the next section. More than 70 M&A deals targeting downstream players have taken place in the past five years.