Germany-based Osram has become a main international LED automotive lighting vendor and due to its particular capability in OLED lighting and laser lighting is expected to maintain its globally leading status in automotive lighting, according to Digitimes Research.The maker was relatively less affected from uncertainties in the LED market compared with others during the first half of 2015 due to its growing developments in OLED lighting. The company's products can be found in high-end automobiles from BMW and Audi, and are expected to be added to more lineups throughout the rest of the year.Low-priced solutions from China makers have also affected the financial performances of makers such as Osram, which saw a 6% on-quarter decline in fiscal third-quarter 2015, but the company's performance in terms of specialized lighting products for automotive and industrial applications remained stable, showing that high-end applications such as OLED are giving makers an edge in the market.Osram will increase capex by 11-23% in fiscal 2015, with 79% allocated to specialized lighting and optical semiconductor applications and 20% to general lighting, showing that it is increasing efforts to further push higher-end, niche products, said Digitimes Research.

Demand for transparent smart glass used in vehicles continues to rise but there are still many different opinions as to what type of technology will be sought out the most due to different developments and costs associated, according to Digitimes Research.Currently head-up display (HUD) technology, which allows drivers to see data displayed on a vehicle's windshied to prevent drivers looking away from their usual viewpoints, sticks out as a major player due to its strengths in displaying information and wind protection but struggles with light adjustment in various settings.Electrochromic (EC) and suspended particle display (SPD) technologies, which can change the visibility of glass from clear to opaque, on the other hand present strong light adjustment qualities but still suffer from high production costs.Polymer dispersed liquid crystal (PDLC) is also on the rise and bistable cholesteric liquid crystal (BiCh-LC) has also made its way in the market, but they have yet to reach commercialization, said Digitimes Research.

China is aiming to improve the self-sufficiency rate for ICs in the nation to 40% in 2020, and boost the rate further to 70% in 2025, according to Digitimes Research.China's consumption of ICs grew at a CAGR of 6.8% between 2010 and 2014, said Digitimes Research. The domestic market will reach a scale of US$106.3 billion in 2015, up 8.5% from US$98 billion in 2014.As the China government continues to pour capital into the local IC design industry sector, the output value of the sector will reach US$19.49 billion in 2015 representing a 21.2% increase from US$16.09 billion in 2014, Digitimes Research noted. The output value of China's IC design sector grew at a CAGR of 31% between 2010 and 2014.Although China has become the world's largest IC consumer, and the local IC design sector continues to enjoy more than 20% growth in output value, there are several major challenges facing China's overall IC industry, Digitimes Research observed.Those challenges include the nation's still low self-sufficiency rate for ICs, and the local foundries' less competitiveness against their international peers in terms of technology. Meanwhile, China's local fabless firms are facing bottlenecks to further enhance their IC design capabilities.The "National Semiconductor Industry Development Guidelines" and "Made in China 2025" were published by China's State Council in June 2014 and May 2015, respectively. Both policies will make a major push in the development of the local IC industry, Digitimes Research believes.Based on the "National Semiconductor Industry Development Guidelines," a CNY120 billion (US$19 billion) national industry investment fund has been set up to help local foundries finance the build-up of advanced manufacturing processes, and also to assist local IC firms to form mergers and/or make acquisitions internationally, Digitimes Research said.The "Made in China 2025" clearly outlines that the nation is aiming to raise its self-sufficiency rate for ICs to 40% in 2020, and 70% in 2025, Digitimes Research indicated.

The four major panel makers in the market saw revenues decline in the second quarter of 2015 but profits remained high due to sales of high-end products such as Ultra HD (4K) TV panels, according to Digitimes Research.Panel makers including Samsung Display and Innolux fall into this category and also benefited from steady pricing for large-size, high-end TV panels. Costs for high-end TV panels also dropped, which helped to maintain overall profits.Makers are concerned about their performances in the third quarter of 2015 due to weak end-market demand. Pricing for various units including 32-inch TV panels continue to drop due to weak demand and because China makers have bumped up production significantly.Panel makers will also see weak demand in the tablet segment while competition in the handset panel segment will remain high, said Digitimes Research.

Retail pricing for 27-inch LCD monitor products will remain flat in August 2015 while 20- to 24-inch units will increase slightly, according to Digitimes Research.The pricing is applicable to the US, UK, Germany, Japan and China. Despite a new wave of curved LCD monitor technology from vendors such as Samsung Electronics, in addition to various touch units, weak demand in the monitor market will keep pricing for 27-inch flat throughout August.Higher-end 23- and 24-inch units will see a slight increase in pricing however due to value-added features and niche market demand but the increase will be minimal.In 2014 there were many instances where 23-inch products were higher in price compared with 24-inch units, but since February 2015 24-inch units have been higher, said Digitimes Research.

Sony plans to ramp up its CIS production capacity by 31% in 2016 focusing on mid-range and entry-level models, which may result in unfavorable impact on the CIS supply chain in Taiwan, according to Digitimes Research.Since 2011, Sony has led the CIS industry with its cutting-edge stacked CMOS, SME-HDR and on-chip PDAF technologies, with plans to triple its lens module shipments during the period from 2014-2017, Digitimes Research noted.Samsung Electronics has not used in-house developed CIS products on its flagship models for over one-and-a-half years, not even in the recently released Galaxy Note 5, which instead comes with a Sony IMX240 sensor.Samsung's adoption of Sony's CIS sensors may affect confidence of other first-tier smartphone brands on Samsung's CIS products, which in return is likely to force the Korea company's CIS business unit to cooperate with second-tier handset brands. Consequently, such a development will cast unfavorable impact on other CIS players, including Ominivision, Aptina Imaging (now On Semiconductor) and those in Taiwan, Digitimes Research commented.

The production value of memory chips in Korea totaled KRW1.313 trillion (US$12 billion) in the second quarter of 2015, increasing 1% from the previous quarter, affected mainly by a low bit growth of DRAM and NAND flash chips from SK Hynix, according to Digitimes Research.Additionally, server-use DRAM products became the primary product line for SK Hynix for the first time in the second quarter as sales of its PC-use DRAM chips suffered a significant decline as compared to a quarter earlier.Price reductions of PC DRAM chips were greater than market expectations in the second quarter due to an oversupply in the market, affecting sales performance of SK Hynix. Comparatively, Samsung Electronics was less affected by declining PC DRAM prices because mobile DRAM products accounted for 35% of its total DRAM income. Samsung also saw its memory and semiconductor revenues hit a record high in the second quarter, resulting in an operating income of KRW3 trillion in the quarter.For the third quarter, the bit growth rates of NAND flash shipments at Samsung and SK Hynix are likely to reach 10-13% on quarter, respectively. Meanwhile, Samsung is expected to see shipments of its DRAM chips grow 12-14% sequentially in the quarter compared to a 5-8% growth at SK Hynix. Overall, the production value of Korea's memory products is expected to increase 3% on quarter and 12% on year in the third quarter of 2015, Digitimes Research estimated.

With the proportion of 4G devices in China's smartphone shipments having already surpassed 90% in first-half 2015, application processor (AP) suppliers have taken different strategies for their carrier aggregation (CA) solutions for the 4G network, according to Digitimes Research.Qualcomm is the most aggressive player on the development of high-end 4G technology and is planning to release Cat.10-based solutions in 2015. China-based Hisilicon is eager to follow suit. MediaTek is mainly focusing on the Cat.6 segment, while China-based Spreadtrum is pushing Cat.4 products.Lacking supporting infrastructure, mid-range to entry-level Cat.6-based APs are expected to be the mainstream products of the China market prior to 2017, Digitimes Research expects.For 4G end devices, their major difference from 3G products is the transmission speed. In addition to improved hardware performance that helps devices leverage the increased networking speed, the availability of content is also a key factor that will determine demand in the 4G market. Without sufficient content, consumers will be reluctant to upgrade their devices.Currently in China, most consumers purchase 4G products because of telecom carriers' subsidies or the devices' specifications and designs. Only a small number of consumers have chosen the upgrade because of the faster transmission speed and content.Most telecom carriers are looking to promote video streaming services leveraging the high speed of the 4G network, but consumers would still rather use Wi-Fi or fixed networks for watching video because of concerns over 4G data fees.

Taiwan makers' shipments of touch panels used in handset and notebook applications are expected to increase 5.9% and 9.6% respectively in the third quarter of 2015, according to Digitimes Research.After increasing 15.2% and 22.4% respectively in the second quarter, demand for the two applications will rise as vendors head into the busy purchasing season, with shipments to China vendors expected to increase most noticeably. Additionally, the makers' tablet panel shipments will increase 12.2% on quarter in the third quarter.Heading into the fourth quarter of the year, Taiwan makers' shipments of handset, tablet and notebook touch panel shipments will increase 13.8%, 18.6% and 24% respectively largely due to orders from Apple and Samsung Electronics. Taiwan makers will benefit from iPhone orders in addition to 10- and 12.9-inch tablet products from Apple as well, said Digitimes Research.In terms of technology, on-cell touch will account for 28.3% of overall handset touch panel shipments from the makers and 12.8% for tablet applications due to Innolux bumping up cooperation with Motorola, and as HannStar Display in addition to Chunghwa Picture Tubes (CPT) supply the technology to ZTE, Coolpad and TCL.

China's shipments of tablet-use application processors are expected to decline 29.4% on year to 47.75 million units in the second half of 2015 due to weak market demand for tablets, according to the latest estimate by Digitimes Research.For all of 2015, tablet-use AP shipments in China are likely to dip 24.4% on year to 96.45 million units, representing the first annual decline in recent years.However, MediaTek is expected to see its tablet AP shipments rebound in the second half of 2015 after registering a steep fall in the first half, which will allow the Taiwan-based chipset supplier to maintain an over 24% share in the latter half of the year.Intel is expected to see the decline rate of its tablet AP shipments in China in the second half greater than that in the first half, affected by changes in subsidiary policy in China and weakening market demand, Digitimes Research asserted. Intel is likely to fall out of the top-three vendor ranking during the second half of the year.China-based Rockchip Electronics will see its ranking edge up to second position in the second half, powered by a rebound in its tablet AP shipments.Tablet AP shipments from Allwinner Technology will continue to decline in the third quarter before staging a significant growth in the fourth quarter. It will rank as the third largest vendor in the second half.Meanwhile, the shipment ratio of Cortex-A53-based tablet APs is expected to rise to over 20% in the second half, while the ratio of Cortex-A7 will decline to below 50%, Digitimes Research added.