LCD flat-panel makers probed for price fixing

Thursday, December 14, 2006

LCD flat panel manufacturers in Japan, Korea, and the US, are facing regulatory probes for anti-competitive practices.

Samsung, Sharp, NEC, LG Philips, AU Optronics, and Chi Mei Optoelectronics are all being examined for allegedly conspiring to fix prices on flat-panel LCD displays, as a means to combat rapidly falling flat panel prices.

Japan and Korea's Fair Trade Commissions, along with the US Department of Justice (DoJ) are heading up the investigations. Samsung as well as LG Philips were the first companies to disclose that they were under investigation, upon receiving subpoenas in the US, Japan, and Korea last week.

The flat panel manufacturers are being investigated for allegedly curbing their output levels, for the purpose of keeping LCD - and specifically thin-film transistor (TFT) - prices from falling too quickly. Rapidly falling LCD prices have been a concern to a great many electronics manufacturers lately. Sony president Stan Glasgow last week said that prices for LCD televisions will drop 25 to 30 percent this year, a more drastic drop than the company had previously anticipated. He indicated that such a trend could hurt the industry, but that such drastic cuts may not last. "LCDs will continue to experience heavy price erosion, but not at this level," Glasgow said.

Samsung plead guilty to price-fixing DRAM sales from 1999-2002 and received a fine of $300 million from the DoJ in return. They were recently subpoenaed again this October for price-fixing SRAM, along with Mitsubishi, Sony, Toshiba, and Cypress Semiconductor.