There were an estimated 371.360 million handset-use touch panels and 48.849 million touch panels used in smaller-than 11-inch tablets shipped globally during the first quarter of 2016, decreasing 15.0% and 29.0% respectively on quarter, while the global shipments of 6.836 million notebook-use touch panels in the period increased 0.8%, according to Digitimes Research.Taiwan-based makers shipped 17.424 million handset-use touch panels, 8.209 million units used in the smaller-than 11-inch tablets and 2.755 million units used in notebooks and 11-inch or larger tablets in the first quarter, respectively slipping 38.3%, 31.3% and 11.9% on quarter, Digitimes Research indicated.On-Cell models accounted for 36.6% of handset-use touch panels shipped by Taiwan-based makers, film-based capacitive ones for 33.1%, OGS (one glass solution) ones for 21.7% and GG (glass/glass) ones for 8.6%.Of Taiwan-based makers' shipments of touch panels used in smaller-than 11-inch tablets, 57.3% were of film-based capacitive models, 32.1% of GG ones, 7.9% of On-Cell ones and 2.7% of OGS ones.Glass-based models took up 96.4% of Taiwan-based makers' shipments of touch panels used in notebooks and 11-inch or larger tablets, with the remaining 3.6% being of film-based ones.

Taiwan server players' revenues from products including server motherboards, servers, storage and related network equipment, continued to enjoy growth on year to surpass NT$500 billion in 2015, according to Digitimes Research.Thanks to a strong performance in the fourth quarter of 2015, worldwide sever shipment volumes rose 9.8% on year to reach 11.08 million motherboards in 2015. Datacenter server shipments will continue to grow strongly on year in 2016 thanks to rising demand from the cloud computing market.Shipments from traditional server brand vendors are expected to increase slightly on year in 2016, helping overall worldwide server shipments to grow 5.9% on year. Digitimes Research believes server shipments have a chance to grow significantly after Intel releases its next-generation Purley platform in the second quarter of 2017.With growing demand from the cloud computing market, Taiwan's server shipments grew 12.5% on year to break 10 million units in 2015, accounting for 90.7% of worldwide shipments and the percentage is expected to grow to 91.1% in 2016. Inventec, Foxconn Electronics (Hon Hai Precision Industry), Wistron and Quanta Computer are the top-four server ODMs in Taiwan, but their combined share of Taiwan's server shipments dropped on year in 2015 as major brand vendors such as Dell, distributed their orders to other ODMs to reduce risks. However, the share is expected to rise in 2016.

A main motivation of Foxconn Electronics' investment in Sharp is to develop AMOLED panels mainly for use in smartphones, for Foxconn is a global leader in the smartphone OEM sector, according to Digitimes Research.Following Samsung Electronics' adoption of AMOLED panels for smartphones, Apple and other vendors will do so for mid-range and high-end smartphone models. Global shipments of smartphone-use AMOLED panels will increase from 3.45 million units in 2016 to 10.24 million units in 2020 and further to 13.57 million units in 2025, Digitimes Research estimates.Sharp will set up one 4.5G and two 6G AMOLED production lines with monthly capacity of 13,000, 11,500 and 34,500 glass substrates respectively, with total monthly capacity of 9.85 million 5.5-inch equivalent panels.Thanks to financial support from Foxconn, Sharp's global market share for smartphone-use AMOLED shipments(including flexible models) will rise from 1.1% in 2018, 6.2% in 2020, 10.0% in 2023 and 13.2% in 2025.

Having taken control of Sharp, Foxconn Electronics will obtain Sharp-developed panel technologies including Oxide TFT-LCD, IGZO TFT-LCD, LTPS TFT-LCD and AMOLED. It is also expected to strengthen Sharp's global competitiveness against Samsung Display and LG Display in OLED smartphone and TV applications, according to Digitimes Research.Foxconn and three other members of the Foxconn Group will together invest JPY388.812 billion (US$3.42 billion) in Sharp for a 66.00% stake, with JPY200 billion and JPY60 billion of the investment earmarked for developing OLED and TFT-LCD respectively, Digitimes Research indicated.Sharp will occupy 5.3% of global large-size panel production capacity in fourth-quarter 2016, ranking seventh after Samsung Display, LG Display, Innolux, AU Optronics (AUO), BOE Technology and China Star Optoelectronics Technology (CSOT).However, Sharp and Innolux, a member of the Foxconn Group, will have a combined global share of 21.9%, slightly less than 23.7% for Samsung Display and 22.7% for LG Display.

China-based makers will ship an estimated 167.294 million touch panels in the first quarter of 2016, decreasing 22.0% on quarter but increasing 17.2% on year, according to Digitimes Research.Shipments will consist of 142.794 million touch panels for smartphones, sequentially down 22.1%, 23.096 million for tablets, down 21.9%, and 1.405 million units used in notebooks, down 20.3%, Digitimes Research indicated.For smartphone touch panels, film-based capacitive models will account for 66.6% of shipments, glass-based capacitive models 27.1% and resistive models 6.3%. In contrast, glass-based capacitive models will account for 72.8% of tablet-use touch panels.

The development of sensor products will play a key role in Korea's plans to ramp up the production value of related IoT (Internet of Things) products from KRW1.6 trillion (US$14.5 billion) in 2014 to KRW7 trillion in 2020, according to Digitimes Research.Led by Korea's Ministry of Trade, Industry and Energy (MOTIE), the Korea government will push for self-sufficiency in production of sensor products, including smart sensors, sensor hubs and sensor fusion solutions and other niche/innovative sensors for IoT applications.Korea's self-assessed its overall sensor technology rating at 64.7 (on a scale where the US rated 95, Europe 98 and Japan 97) in 2015, and therefore it still has to rely on imports of a number of sensor products, including accelerometers, gyroscopes, pressure sensors and other MEMS sensor products.Under MOTIE's plans, Korea will inject a total of KRW150.8 billion to assist its small and medium enterprises to develop advanced sensor products, focusing on 10 sensor items, which include those related to imaging, inertial forces and pressure. The plans also call for the development of smart sensors integrated with logic, communications, signal processing ICs.Meanwhile, Samsung Electronics will also play an important role for the development of niche and innovative sensor products for IoT applications, said Digitimes Research, noting that Samsung already acquired or committed investments in a number of hardware and software companies engaged in the development of IoT products in 2014-2015.

Server brand vendors and ODMs are mainly purchasing their components in three business styles: buy and sell, direct sourcing and direct buying and Taiwan-based component makers are a key part of the server supply chain and have acquired an important position in the industry.For key components such as the CPU and baseboard management controller (BMC), brand vendors usually assign a specific supplier, while suppliers of passive components can be decided by ODMs themselves, according to Digitimes Research's latest report about servers.Other key server components include power ICs, connectors, hard disk drives (HDD), cooling modules, power supplies, chassis, PCBs and slide rails. Except for CPUs, power ICs and HDDs, Taiwan-based suppliers hold a significant influence in all of these component industries.

Observing the launches of consumer digital still cameras (DSC) scheduled in spring 2016, the number of models is 30% less than the same period a year ago. The top-two vendors, Nikon and Canon, each have three models fewer, while Sony and Samsung Electronics will not release any new models for the season, according to Digitimes Research.To differentiate from smartphones, DSC vendors will mainly target their consumer DSCs for spring 2016 at high-specification-and-high-price, raising the proportion of new models with prices above US$500 from 6% in spring 2015 to 36.4% in spring 2016.For spring, Nikon has launched three DL-series DSCs, adopting the Nikkor lenses, which were originally used only in its DSLR cameras, and a 1-inch CMOS image sensor, priced between US$630-950, pushing consumer DSCs to start featuring DSLR camera equipment, according to Digitimes Research's latest report.

Apple will ship an estimated four million 9.7-inch iPad Pros during the first half of 2016. The 9.7-inch iPad Air 2 will account for the largest portion of all iPads shipped in the first half of 2016 mainly because retail prices will drop to US$399.The iPad Air 2's price drop is expected to impact demand for the 7.9-inch iPad Mini 4, according to Digitimes Research.Since the 12.9-inch iPad Pro, priced at US$799 had a price gap of US$300 with the iPad Air 2, priced at US$499, in 2015, Apple's release of the 9.7-inch iPad Pro has filled in its product line.

LG Display has decided to invest KRW10 trillion (US$8.63 billion) over the next three years to expand its AMOLED production capacity, mainly to set up P10 factory which can house more than six AMOLED production lines, according to Digitimes Research.With the first phase to begin operations in the second half of 2018, P10 will become the world's largest production base for AMOLED TV panels, Digitimes Research indicated.The investment includes KRW1.5 trillion to set up a 6G AMOLED production line with monthly capacity of 7,500 substrates, producing flexible AMOLED panels for use in automotive displays and smartphones.LG Display's total AMOLED production capacity in 2018 will be 3.62 times the level in 2015, with 72% of the additional capacity to be used to produce OLED TV panels and 28% flexible AMOLED panels for automotive displays and smartphones.LG Display has significantly hiked yield rates for OLED TV panels and AMOLED displays can offer market segmentation from TFT-LCD panels to secure profitability. The TFT panel market is facing strong competition due to large expansion of 8.5G capacities in China.