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Samsung predicts fall in LCD prices

South Korea's Samsung Electronics said it expects LCD prices to fall by at least 20 percent by the end of 2004.

The prediction came as Samsung and Sony launched a joint venture in central South Korea to make LCDs, adding to a surge in new production that is pushing down screen prices.

South Korea’s Samsung and Sony plan to invest $1.8 billion in S-LCD venture, which will have a production capacity of 60,000 panels a month. Mass production at a new plant is slated for the second quarter of next year.

The venture will give Sony a steady supply of flat screens, guarantee Samsung a large customer base and increase the chances of Samsung’s screens becoming an industry standard.

However, the LCD industry’s outlook is clouded by expectations of a glut of thin screens for computers and TVs. Japanese consumer electronics maker Sharp, warned of price declines as competitors increase their output capacity.

Consumers are delaying purchases of LCD TVs and monitors expecting prices to fall, while set makers want to keep their inventories light.

Analysts see prices of 17-inch LCD screens falling as much as 25 percent by the end of the year from the first-quarter peak and have cautioned about weaker demand for larger panels. Cho Yong-duk, vice president of Samsung's LCD division, told Reuters his forecast of up to 20 percent referred to the difference between prices at the end of June and the end of December.

Independent research group DisplaySearch forecasts the price of 28- to 32-inch LCD panels will fall 15 percent in 2004 from 2003 to $975.

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