LED Lighting will drive new Opportunities for Power Component Manufacturers

Ryan Sanderson, Senior Market Analyst for Power Management, IMS Research



Since the first 60W equivalent LED replacement light bulb (LED lamp) was unveiled by Philips Electronics in May 2010, the market for LED lamps and luminaires has been flooded by products from an ever increasing list of manufacturers. A divide in the market is already apparent between manufacturers trying to address the cost-driven, high-volume, low-cost LED retrofit lamp market, and those targeting the more complex medium and high power applications that use specific LED luminaires. The good news for power component manufacturers is that large market opportunities exist in both! The largest barriers for traditional lighting manufacturers producing LED lamps/luminaries are the challenges they face producing driver circuitry. The main selling points over competing lighting technologies used my manufacturers of LED lighting are higher efficiency (or reduction in power consumption for the same lumen output), longer lifetime, and better light quality. None of these can be achieved without a driver circuit which is optimised to the lamp/luminaire design. Whilst some manufacturers have the ability to achieve this "in-house", most require the expertise of a power supply/power semiconductor manufacturer. The global market for power supplies used in LED lighting is projected to grow to almost $10 billion in 2016. Over half of this is predicted to be for power supplies used in low-power retrofit LED lamps. This portion of the market is, however, projected to become the most "captive"; with almost 80% of drivers predicted sold in 2016 to be produced "in-house". Large LED lamp manufacturers, such as Philips Electronics, GE and Osram, already have these capabilities. Whilst this limits the opportunities in the retrofit LED lamp market for manufacturers of merchant power supplies, the lamp manufacturers still source power semiconductor components from mainstream suppliers. In fact the total market for power semiconductors (power ICs and discretes) for LED lighting is forecast to grow to more than $3 billion in 2016, with over 70% of this attributable to the retrofit LED lamp market. Power semiconductor market growth will be driven both by sales direct to OEM or lamp/luminaire manufacturers and to merchant power supply manufacturers. The retrofit LED lamp market, however, is only one application in the total LED lighting market and there are many other opportunities. Over half the total power supply market for LED lighting in 2016 is forecast to come from sales of merchant power supplies. Medium power (25W-59W) and high power (60W+) LED applications tend to have multi-string architectures and therefore demand a more complex and more expensive driver solution. LED luminaires for these applications may use an "off-the-shelf" merchant power supply solution or approach a merchant vendor directly for an optimised design. Though some lighting manufacturers may be capable of designing a driver in-house, it is often much more complex and expensive to do this rather than purchase from a merchant specialist. Of the medium and high power applications for LED lighting, industrial and street lighting offer the largest opportunities, their combined power supply revenues being projected to grow close to $1.5 billion in 2016. As these driver designs are more complex they often use high power MOSFETs and more expensive controllers/regulators which can drive multiple channels and therefore multiple strings of LEDs. The total global market for power semiconductors in industrial and street LED lighting applications is projected to grow to almost $400 million in 2016. LED lamp/luminaire manufacturers along with power supply and power semiconductor manufacturers are already looking into more intelligent lighting solutions. Such solutions are predicted to create additional opportunities for manufacturers of microprocessors, communication ICs, digital power solutions and, in some cases, advanced materials. www.imsresearch.com