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17 February 2016

Technavio profiles top-four vendors in packaged GaN LED market for 2016-2020

In its report 'Global Packaged Gallium Nitride (GaN) LED Market 2016-2020'  – which forecasts a compound annual growth rate (CAGR) of more than 5% – market research firm Technavio has profiled the top four leading vendors (Cree of the USA, Epistar of Taiwan, Osram Opto Semiconductors of Germany, and Samsung of South Korea), as well as the six other prominent vendors (De Core Nanosemiconductors, LG Innotek, Nichia, Philips Lumileds, Seoul Semiconductor, and Soraa) that are expected to impact the market during the forecast period.

Competitive vendor landscape 

The global packaged GaN LED market is highly competitive between the key vendors Cree, Epistar, Osram Opto Semiconductors and Samsung, which are adopting new technologies to gain an edge over the other players. Cree invests in marketing activities to build its brand and expand its product offerings to position itself in both commercial and consumer lighting segments, says Technavio, whereas Samsung seeks to explore business opportunities in new areas such as health, medicine and biotechnology to enhance profitability in its organic light-emitting diode (OLED) business.

"Despite a low concentration of vendors, there is intense competition in this market due to the strong positions of the existing vendors," says Asif Gani, Technavio's research analyst for semiconductor equipment. "The highly competitive environment, rapid advances in technology and the cyclical nature of the semiconductor industry all pose a substantial risk to the vendors."

Top four global packaged GaN LED vendors  

Cree relies more on innovation and develops new products that deliver economic and competitive value to its customers, says Technavio. With R&D facilities in the USA, India and China, the firm is aiming to constantly improve the quality and performance of its products by developing brighter and more efficient low-cost products. Cree's manufacturing units are located primarily in the USA and China. The firm also has subsidiaries in more than 10 countries, including China, Taiwan, Malaysia, Japan, South Korea and in Europe. Major corporations such as Mitsubishi Chemical, Nichia, Seoul Semiconductor, and Osram Opto Semiconductors license the company's products.

Cree offers a comprehensive range of LED components, LED chips, silicon carbide (SiC) wafers, and both LED-based and traditional lighting systems. Products are used in multiple applications such as indoor and outdoor lighting, video displays, transportation, electronic signs and signals, power supplies, inverters, and wireless systems.

Epistar is a pioneer in the design and development of high-performing packaged GaN LEDs. The firm is one of the leading LED makers in Taiwan and is engaged primarily in developing, manufacturing and selling LED chips and wafers. They specialize in supplying high-brightness LEDs and have a broad product portfolio that contains multiple LEDs. The major target segments are lighting and consumer electronics. Epistar has also developed a unique Co-Activation Service Model, through which it can work in collaboration with clients to design and develop integrated circuits.

The firm has a capacity for expansion, which has made it a leading supplier of packaged GaN LEDs. Epistar has worked jointly with brands around the world and delivered LEDs for cellphones, monitors, laptops, and TVs.

Osram Opto Semiconductors intends to expand its global presence by manufacturing and delivering multiple lighting products, solutions and services. The firm supplies sensors, LEDs and visualization solutions based on semiconductor technology for the automotive market. It also provides compact LEDs suited to pico projectors and pocket projectors for small mobile terminals. Osram Opto also supplies surface-emitting panels for applications in hotels and catering, offices and architecture. The firm also has a Black Series of LEDs for applications in trains, planes, automobiles and refrigerators.

Samsung's subsidiary Samsung LED focuses more on long-term growth than short-term profits, says Technavio. The parent company has established a new global engine, the Samsung Strategy and Innovation Centre, with an investment of $100m, to accelerate innovation and new business creation for its device solution business. In its nascent stage, this center is expected to focus on electronic components and subsystems to fuel innovation technologies and business models. This aims to enable Samsung LED to capitalize on its parent company's resources and gain an edge over its competitors.

Technavio summarizes that the packaged GaN LED market is highly competitive, with significant entry barriers such as intensive capital investment. This explains the intense rivalry between existing players, which is likely to continue during the forecast period.

The other six prominent vendors in the market are De Core Nanosemiconductors, LG Innotek, Nichia, Philips Lumileds, Seoul Semiconductor, and Soraa.

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