NPD DisplaySearch forecasts this segment will reach to 13.0 million square meters in 2012, and grow to 16.4 million in 2014. The touch panel industry has grown rapidly in recent years, from $4 billion in 2009 to over $13 billion in 2011. NPD DisplaySearch forecasts continued strong market demand, driven by mobile devices such as smart phones and tablet PCs, as well as PCs and point-of-information applications. Many new companies, including display and color filter manufacturers, are rushing to gain share in the market.

The rapid growth of these four touch technologies has raised several questions about the development of the industry, including the balance of supply and demand, how quickly sensor-on-cover projected capacitive touch can take share from conventional projected capacitive, and how on-cell and in-cell touch will impact add-on type touch screens.

“Capacity in 2010 and 2011 was slightly higher—13%—than demand, but this level of oversupply is healthy, given the rapid pace of growth in the touch industry,” said Jennifer Colegrove, Ph.D., Vice President of Emerging Display Technologies for NPD DisplaySearch. “However, the glut is expected to more than double in 2012, to 27%, causing touch sensor prices to reduce rapidly. The oversupply will also force touch suppliers to move to larger size applications to utilize capacity, such as notebook and all-in-one PCs, ATM/finance and point of information,” Dr. Colegrove noted.

The research firm found that resistive touch sensors were in oversupply in 2010. In 2011, most resistive touch manufacturers dramatically reduced their capacity; some converted their lines to projected capacitive touch. In 2012, resistive touch manufacturers continue to minimize capacity, leading to a balanced supply/demand outlook. While resistive continues to be strong in applications such as automotive, education/training, and industrial, it will slowly decline.

Projected capacitive touch manufacturing has increased dramatically, from 27 companies in 2009 to over 80 companies in 2011. Many projected capacitive suppliers are also establishing sensor-on-cover (SOC) fabs.

SOC is forecast to grow fivefold in area terms in 2012. Due to its light weight and thinness, SOC is likely to be adopted by tablet and notebook PCs, including form factors such as sliding and convertible. Many leading touch module makers increased their cover glass capacity in 2011 in preparation for SOC production. NPD DisplaySearch forecasts SOC will capture an 8.6% share in 2012. On-cell is mainly used in AMOLED displays. In 2013, as large AMOLED fabs enter full production, there will be a significant oversupply (52%) of on-cell.

In-cell touch has been researched and demonstrated for many years, and in 2012, mass production will begin. Sony announced it is producing 4.3” in-cell LCDs. Synaptics is producing controller ICs for in-cell touch designs. As yield rates improve and tier one smart phone brands adopt the technology in 2013-2014, in-cell will experience strong growth.

Production of transparent conductive substrates (mostly ITO) for the four types of touch covered in the report will grow from 20.8 million square meters in 2011 to 30.9 million in 2014.

The Touch Sensor Manufacturing Capacity report includes information on nearly 100 fabs, including glass substrate generation, substrate size, substrate allocation, substrate input, yield rate, and yielded touch sensor area (in square meters). Transparent conductive substrate (ITO and ITO replacements) input information is also provided, and supply and demand for each of the four types of touch sensor is analyzed.

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