Average pricing for entry-level LCD TVs sized 32-inch reached US$361 in March 2014, down US$2 on month but up 3% on year, according to Digitimes Research.In terms of entry-level TVs sized 40- to 43-inch, pricing went up from US$528 in February to US$563 in March while 46- to 49-inch units rose from US$768 to US$791.Meanwhile, 50-inch units at large have dropped on average from US$872 to US$833 on month in March while 60-inch units from Samsung and Sharp have risen from US$937 to US$1,015, added Digitimes Research.

Digitimes Research has learned that Google is set to release at least two Nexus tablets in 2014 with an 8.9-inch model already under development and set to enter mass production in July. The 8.9-inch tablet features a display resolution of more than 2K.Although Google may still release a smaller-size model in 2014, its strategy of skipping most of the sizes in the 8-inch range and going for an 8.9-inch display - a size that colud be categorized as large-size tablet (9-inch and above) - shows that the Internet giant is starting to shift its focus to large-size tablet applications.In 2013, Android had an over 50% share in the small-to medium-size brand tablet market and is expected to achieve further growth in 2014 as brand vendors turn to push 8-inch tablets. The 7-inch segment will continue to see shipment growth thanks to strong demand for models with phone functions, Digitimes Research believes.However, in the large-size brand tablet market, Android only accounted for around 30% in 2013 and its shipments amounted to only half of those of iPads. Windows also trailed behind with around 10% market share.Because of Google's disadvantages in the large-size brand tablet market, Digitimes Research believes the release of the 8.9-inch Nexus - a product with a good price/performance ratio, sufficient mobility, and a strategic position between the large-size and small- to medium-size segments - may motivate the rest of Android camp to also skip the 8-inch segment and head for the large-size segment.More importantly, whether the Android camp is able to create new added values for the large-size tablet market and in turn boost the overall market, will heavily depend on Google's ability to enhance Android tablet-only applications and attract more application developers to join the ecosystem.Digitimes Research believes if the 8.9-inch Nexus can be priced at around US$299 and if Android 5.0, which may be released at the Google I/O in June, is able to feature more Android tablet-only applications, it should help the 8.9-inch Nexus tablet achieve a breakthrough in the large-size tablet market.

In addition to its existing Xfinity Triple-Play services, US-based Comcast has recently announced it will cooperate with US-based NRG Energy to offer electricity services. The move is expected to add an additional service to Comcast's packages and help bring in more revenues to the company.Comcast has also announced it will acquire the second-largest cable TV company in the US, Time Warner Cable and if acquired, Comcast will be able to take a 30% share in the US' paid-TV market, strengthening its competitiveness against its telecom carrier and satellite TV competitors. The acquisition news also helped Comcast's negotiation with Netflix, which Netflix agreed to pay Comcast for better streaming.Digitimes Research believes Comcast is planning to use its economies of scale to push into the digital home market. The digital home market used to focus on multimedia entertainment contents, but now the market has turned to focus on new applications such as energy management driven by Google's acquired Nest, home security management and telecare. Comcast's Xfinity Home is a service that combines the energy and security management and the company's entry into the electricity industry will allow it to become a more complete supplier of digital home solutions.

Recently, rumors have been spreading in the market that Taiwan panel makers AU Optronics (AUO) and Innolux may merge into one company to combat competition in the market. Market observers said that such a move is likely considering the rise of China's panel industry coupled with increasing competition from Japan- and Korea-based panel makers.Sources at both companies over the last year have admitted there are increasing challenges due to China's flat panel industry growth, but have yet to specify that such growth is expected to hinder the development of Taiwan's panel industry in the future. While both companies have suffered losses in recent years, the sources said they are making advancements in niche markets with value-added products and are working more closely with supply chains to produce low-cost solutions as a means to further compete with China.Market observers, however, still believe the road ahead will be a problem for Taiwan's panel industry. The observers believe Taiwan is caught in the middle between not having enough low-cost solutions like China panel makers and not enough technology advancements in the high-end segment like Korea- and Japan-based panel makers. More so, governments in Korea and China are increasing support either through funding, which is helping panel makers in the two places expand production capacity and improve technology. China's government may even increase panel tariffs, which could pose even more challenges for Taiwan makers.If a merger were to occur between AUO and Innolux, it would have to be extremely tactic, with the aim of allowing the two companies to regain a competitive edge in the market rather than simply cutting down costs as a means to increase profits. If the two companies merge that means the same personnel and facilities would be part of their business, so then what makes that special in the market? This question needs to be thought of more in depth and as of now there are no reports stating the details of the merger since it is mostly speculation.Another aspect that needs to be considered is the incentives Taiwanese get for working with local panel makers. The sources have stated over and over again they are losing their best talent to China panel makers due to higher salaries, which they believe has given China an upper hand in developing new technology. If what the sources are saying is true, then the companies need to consider the incentives given to employees in order to keep them in Taiwan or improve efforts to bring in more.Taiwan's government is concerned about the impact of Taiwan's panel industry declining, as there are more than 200,000 workers associated with panel supply chains in Taiwan. What is surprising though is that the government has been quiet both in terms of how much it supports a merger and whether it would provide support for the industry financially. The local government should be more vocal on its position towards the panel industry as well as highly consider extending funding for possible technology improvements.Taiwan's panel industry is at a major crossroads and decisions made over the next year may highly affect the overall development of the industry in the years to come.

With Full HD (1,920 by 1,080) having become the mainstream specification of high-end smartphones in 2013, industry players are speculating over the possibility of the resolution climbing even higher to above the 2,000-pixel level in 2014. However, Digitimes Research believes such a chance is rather slim as production of high-resolution panels using LTPS and IGZO technologies still faces low yield rates and insufficient capacities.AU Optronics (AUO) started mass producing its 6-inch WQHD (2,560 by 1,440) panels with a pixel density of 490ppi earlier in 2014 and is supplying them to China-based smartphone player BBK. China-based smartphone vendor Meizu has recently announced its next-generation MX4 smartphone will adopt a 5.5-inch 2,560 by 1,536 543ppi screen. Sharp has also signed a contract with China-based smartphone vendor Xiaomi to supply its IGZO panels to the vendor. Although Sharp did not reveal any detail on the size or resolution of the panels involved in the contract, the chance is rather high that the panels will be above 2K resolution, judging from Sharp's definition for its IGZO panels.At Mobile World Congress (MWC) 2014, several first-tier smartphone vendors which had been originally rumored to be releasing 2K-resolution smartphones, such as Sony, Samsung, and LG, instead only showcased flagship models with Full HD displays. Since their displays were larger than their predecessors', the pixel densities were therefore lower. This shows that first-tier brand vendors are more conservative than expected about 2K-resolution smartphones.They have cocerns over panel supplies. To produce panels with a pixel density above 400ppi, the makers will need to adopt high-end technologies such as LTPS TFT, but so far only limited capacities are available for mass production using the technology.Although LG Display (LGD) and Japan Display (JDI) both established 6G production lines for LTPS in 2013, Digitimes Research believes these new capacities are unlikely to be operating in full in the short term as they are still at the initial stage of mass production and adjustments over process parameters are still needed.As for production of 500ppi-level panels, low yield rates during the initial stage will undermine supply. For first-tier smartphone vendors, who aim at massive shipments, panel supplies are the biggest issue needed to be resolved before the 2K resolution may become the mainstream.Therefore, smartphone vendors that dare to take up the 2K challenge are mostly from China where most of its demand is for CNY1,000-level mid-range/entry-level smartphones. High-end models with 2K reslution are developed only for the niche market or meant to enhance the vendors' brand recognition. Big volumes of shipments are not their concern.Although first-tier smartphone vendors are expected to start releasing 2K-resolution models in the second half of 2014 after LGD and JDI see improved operations at their 6G lines, vendors will continue to promote their Full HD smartphones side by side their 2K models, which are unlikely to become the mainstream of the high-end segment in the near term.

US-based GT Advanced Technologies (GTAT) is setting up a factory in Arizona for exclusive supply of sapphire to Apple, with the factory to be able to meet only 9.0-16.6% of demand for sapphire used in screen covers of a new-generation iPhone in 2014, according to Digitimes Research.The estimation is based on GTAT's forecast sales of US$188-348 million from sapphire material (not including sapphire crystal growing equipment and technology). Typical production cost for a 4-inch sapphire wafer is US$30, Digitimes Research indicated.Assuming that the new-generation iPhone will have a 5-inch screen, then the forecast sapphire revenues are translated into output of 6.27-11.6 million 5-inch sapphire-made screen covers. As Digitimes Research estimates that Apple will ship 70 million units of the new-generation iPhone in 2014, the output of sapphire screen covers frm GTAT will account for 9.0-16.6% of the iPhone shipments.

Wearable devices' functions have extended from the traditional area of information management to health management. This trend was highlighted by many smart health-monitoring bracelets showcased at the Consumer Electronics Show (CES) 2014. Google announced in January 2014 that its Google X laboratory will start developing smart contact lens that is able to constantly monitoring a person's blood sugar levels. The smart contact lens relies on a technological concept similar to radio frequency identification (RFID) and the firm has already created a prototype of the lens.The smart contact lens could be a perfect match for Google Glass, which can act as a wireless signal transceiver of the contact lens. Digitimes Research believes the smart contact lens is more than just another addition to the health management market. It could help extend the value of Google Glass.

Brand vendors have started showing interests in large-size tablets since early 2014. In addition to Apple's rumored 12.85-inch tablet, Samsung Electronics has already launched a 12.2-inch Android-based enterprise tablet, while Asustek Computer is planning to release a 13.3-inch dual-OS tablet.However, most of the large-size tablet projects face difficulties because of lack of support from related platform developers and ecosystems. Apple has also been said to shelved its large-size tablet project. Meanwhile, Google has decided to push an 8.9-inch Nexus tablet for 2014, showing that the Internet giant is starting to shift its focus to larger-size applications.Samsung flooded the market with several tablets of different sizes and specifications in January and is pushing its 12.2-inch tablet with a new user interface and multi-tasking ability, features that are designed for the enterprise market.But Samsung tablet has a weaker price/performance ratio compared to notebooks of the similar price range. Worse still, most of Android's enterprise applications are inferior to those on the PC platform. The Samsung tablet's new user interface also deviates much from the usual Andriod experience, to the dismay of Google. Therefore, Digitimes Research expects Samsung's new 12.2-inch tablet to only achieve shipments of around one million units in 2014.The Asustek-Intel cooperation on large-size dual-OS tablets was originally expected to bring the Taiwan-based vendor advantages in terms of product differentiation and boost other PC brand vendors' willingness to develop Android on x86 tablets. However, because Google is unwilling to see Microsoft benefit from its ecosystem, Asustek's TD300 tablet shipments and second-generation T100 development have both been delayed.The 8.9-inch Nexus is Google's first tablet project for 2014. With a screen big enough to compete in the large-size tablet segment, and with low cost and mobility, Digitimes Research expects the Nexus tablet to help prompt other brand vendors to turn to the large-size tablet segment, which only currently accounts for 30% in overall tablet shipments.

As smartphone popularity rises, demand for handheld games consoles has been dropping, especially for Sony's PS Vita. With an the upgraded PS Vita Slim set for release later in 2014, Sony is trying to earn back its momentum with a thinner and lighter industrial design. However, with the entry of smartphone gaming peripherals, handheld games consoles are expected to face a greater challenge in the future.Gaming peripherals for smartphones can be separated into two major categories: protective case type which directly attach to smartphones, and controller type, which are an independent controller that can be connected to smartphones. The former type has advantages in mobility, while the later is pushed for its usage experience. Logitech's PowerShell Controller is an example of a protective case type peripheral, while Samsung's Wireless GamePad is an example of a controller type.With game designers aggressively moving their latest games to mobile platforms, Digitimes Research believes handheld games consoles will eventually be replaced by smartphones and the trend will also open up new business opportunities for gaming peripheral players.

As demand for smartphones and tablets is gradually approaching saturation with related shipment growths slowing down, vendors have been aggressively seeking new growth drivers. Wearable devices are identified as one of the main growth drivers. Among them, smart watches, bracelets and glasses look the most promising.The South Korea government, seeing strong potentials in the wearable device market, has already come up with a series of strategies for the sector in the run up to 2020. It aims at having the country's wearable device shipments account for 40% of the global volume by 2020.The South Korea government is encouraging more firms to join the sector, looking to increase the number of its players by 100 by 2020 with wearable devices to account for 50% of the country's total IT production by 2020. The number of wearable device patent applications in South Korea has also been increasing each year.Digitimes Research identifies battery life and industrial design as presenting some of the biggest R&D challenges for countries or firms that wish to enter the wearable device market. Battery life affects the optimization of hardware intergation, which in turn affects the richness of app contents. Industrial design, on the other hand, is crucial in terms of consumers' willingness to wear the devices.The development of the wearable device sector is not only about the devices themselves, but also about the upstream supply chain as well as the downstream telecom carriers, apps designers and hardware retailers. For South Korea, its strengths coming from its panel and battery sectors are expected to boost their competitiveness in the wearable device market.