Shipments of both notebook and tablet panels rose in the third quarter last year as brands were gearing up for the 2019 holiday season, resulting in strong performance overall for the display panel business during the period.

Shipments of both notebook and tablet panels rose in the third quarter last year as brands were gearing up for the 2019 holiday season, resulting in strong performance overall for the display panel business during the period.

Notebook panel shipments climbed to 17.0 million units in October 2019, up 6% from the same time a year ago, according to research data from IHS Markit | Technology, now a part of Informa Tech. Meanwhile, tablet panel shipments in the third quarter of 2019 expanded in the double digits, up 19% from year-ago levels to 64.8 million units.

In notebooks, the largest increase in panel purchasing during Q3 was from Lenovo, which enjoyed robust growth in its commercial notebook segment. Dell and Apple were two other companies besides Lenovo that raised notebook panel purchasing during the period.

In tablets, China’s BOE remained the largest player as of Q3, its 45% share of market unchanged dating to the first quarter. BOE’s share in supplying panels for the white-box market was especially high, amounting to a record 58% of the total white-box display panel market.

Huawei, despite US sanctions, continued to enjoy strong support in China, which is planning to decrease the panel size of its tablets in the premium tablet category. Suppliers who work closely with Huawei in its smartphone business could have an advantage in winning the right to supply panels for the company’s tablet operations.

Apple's production increased, primarily from the new 10.2-inch iPad.  After ensuring it had adequate panel supply for the new product, Apple then resumed regular production on the 11-inch iPad Pro. The 9.7-inch iPad, meanwhile, will be discontinued.

Outside the main tablet business, demand was strong in Q3 for smart displays, which were heavily promoted during Double Eleven, also known as Singles Day, the biggest shopping day in China.

These findings can be found in the new displays report, Tablet and Notebook Display & OEM Market Tracker – Q3 2019, the latest edition of a quarterly research study focusing on display technologies, the strategies undertaken by brands, and the OEM supply chain for tablet and notebook panels.

Display technology trends in notebooks

A trend in notebook display panels is the rise in their share of the total cost of materials, especially for premium notebook models. While the display panel accounts for just 7% of the total material cost of entry-level notebooks, that figure rises to 9% for mainstream models utilizing full high-definition (FHD) in-plane switching (IPS) technology, which provides higher-quality color reproduction. IPS panels, whose prices are decreasing, will soon be the mainstream technology in displays, IHS Markit anticipates.

For high-end computers featuring ultra-high-definition (UHD) resolution, the UHD panel can account for up to 15% of the total material cost of the notebook. To this end, resolution remains the most important factor in panel specifications, IHS Markit believes.

The 16:10 aspect ratio, a recent innovation, is another important trend. Dell, a leader in narrow-border panels for displays, is considering adopting four-sided narrow-border displays for its next-generation XPS line of laptops. For its part, Huawei plans to add a new product with a 13.3-inch, 16:10 display panel to compete with the Apple MacBook Air. The new aspect ratio, instead of the conventional 16:9 standard, often translates to lower cutting efficiency of the panels, which could then increase panel manufacturing costs.

The position of the camera is also undergoing change. Dell has placed the camera at the bottom of notebook display, referred to as the “nose camera,” owing to its inappropriate position. Huawei has adopted a creative solution: The camera could “jump up” and hide in the keyboard, but the manufacturing costs are higher.

Last, the market for 15.6-inch notebooks is declining, supplanted instead by more portable 13- and 14-inch notebooks.

Smart displays

Unlike in smartphones and tablets, the displays in smart speakers and smart home devices do not need to be of high picture quality. However, a display is required to allow more intuitive operation of the smart home device by users.

The size of the display for smart speakers and smart home devices can vary. For instance, the Echo Spot, part of Amazon’s line of smart speakers that aims to replace the alarm clock, has a 2.5-inch screen in its current version. In comparison, the Echo Show has a 5-inch display, down from its original 10-inch display size, after lower-than-expected sales of the 10-inch Echo Show revealed that consumers preferred a smaller, less prominent device for use in their homes.

Other recent entrants in the smart displays business include Facebook, which has launched 10.1- and 15.6-inch products; and Huawei, which is marketing its 55-inch TV as “not a TV, but the future of TV,” signifying its ambitions in building a smart home ecosystem.

Smart displays could help increase demand for panels, especially in the small- and medium-sized display category. For one, smart displays could fill the gap left by a display panel market that is shrinking for tablets and stagnant for smartphones. Moreover, there is no significant difference in the production of panels for smart display devices compared to those for tablets and smartphones, and producing panels for smart displays may even be easier and also more profitable.

The Tablet and Notebook Display & OEM Market Tracker – Q3 2019 report from IHS Markit | Technology is a component of the Tablet and Notebook Display & OEM Intelligence Service and is offered in the Displays research category, under the Display Manufacturing & Supply Chain research category. IHS Markit | Technology is now a part of Informa Tech. Contact us for more details on the report or if you wish to become a subscriber.