Monitor the Price Cuts
LCD computer screens may have bottomed out
Finally, there is something in electronics you can buy today without feeling sick as the price drops within weeks: computer monitors, where price tags for 17- and 19-inch LCD monitors appear to have hit bottom, at least for the coming months.
Production cutbacks in the Asian factories that make LCD panels, which account for the bulk of a monitor's cost, actually drove panel prices up in the early fall, some as much as 25 percent, says analyst Sweta Dash of the market research firm iSuppli.
Companies involved in producing the monitors absorbed most of the panel increases, she says: "Very little was passed on to consumers."
What happens next may depend on holiday shoppers. Even if demand softens, LCD makers are loath to cut prices on monitors, which are among their few profitable products, says a report from WitsView Technology, another firm that tracks their sales.
It's tough to make money in the larger panels used for TVs, where LCDs have competitionfrom rear-projection sets and, more notably, plasma displays. Struggles for market share have continued to drive down the prices of flat-panel TVs, with the average price of a 42-inch plasma set dropping 3 percent in October alone, WitsView says. Amid the season's sales, 42-inch plasmas, and even the rare LCD, can now be found for as little as $1,000.
Adding pressure on LCDs is competition among formats. Samsung and Sony are trying to establish 40-inch LCDs, while LG and Philips are pushing 42-inch sets. "So it's another battle, this one to set the standard," says iSuppli's Dash.
This story appears in the December 11, 2006 print edition of U.S. News & World Report.