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    LED Industry Status: Go Ahead Happily with Pains

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    • Published : 12/25/2012
    With the further increase of global LED market demand, the development of China’s LED industry is facing great opportunities but meanwhile there will be unprecedented challenge. At present, LED core technology and patents are monopolized by foreign countries’ companies basically. It can be said that China’s LED industry is go ahead happily but with pains.

    LED Industry under International Perspective
    Currently, global LED industrial pattern has been formed initially as the three regions of Asia, North America and Europe being centered and Nichia and Toyoda Gosei in Japan, CREE and Bridgelux in USA, OSCRAM in Germany and Philips LumiLED in Nertherland as technical competition pattern with core technology. The several large international enterprises from Japan, USA, Europe represents current upstream status of LED industry and have important influence on LED industrial development. The influence is not only on products and revenue, but also on technology monopoly because over 50% core technology patents are hold on the several large corporations. However, our country’s LED is at the lower-end level and 80% products are concentrated in landscape lighting, traffic lights and other application market. General LED lighting market is still under promoting process.
    With the booming development of domestic LED market, more and more foreign enterprises turn their attention to China. In recent years, the number of patent applications in LED field has increased significantly in China. There have been 22 countries or regions applying for patents in China, including Japan, Korea, USA, Germany and Netherlands as the top five ones. Japan is going ahead more among them, accounting 24% of the total number of patent application, up to 1,306. From the distribution of industrial chain, foreign companies’ patents are mainly on chips, LED encapsulation. There are over 50% LED core invention having been applied for patents in China and foreign LED enterprises hold the vast majority of the core patented technology. 

    Domestic LED Industry Going Ahead in Twists and Turns
    Domestic LED industry has started since 1970s. After development for forty years, there have been seven national semiconductor lighting industrialization bases formed, including Shanghai, Dalian, Nanchang, Xiamen, Shenzhen, Yangzhou and Shijiazhuang. Products are widely utilized in landscape lighting and general lighting fields. At present, China has been the first large lighting electrical appliances manufacturing country and the second large lighting electrical appliances exporting country. There are totally over 3,000 LED enterprises in China until the end of 2011 and there are only 140 companies with annual output value over 0.1 billion RMB among them. Among the 140 companies, there are no one with annual sales income over one billion RMB. There are only several ones over 0.5 billion RMB. 
    Why does China’s LED industry go ahead so hard? One reason is the lack of authoritative industry technical standard. The other is that enterprises’ R&D is mainly concentrated on downstream application field but with less on mid and upstream fields. But foreign big corporations and some enterprises in Taiwan have been monopolized on most part of LED core technology. And so enterprises in the mainland of China can only turn to downstream application market with low technology. 
    China’s LED enterprises must pay more attention to accumulation of intellectual property right on the beginning stage, using science and technology to arm themselves and using patents to develop domestic and foreign markets, striving to change “pitfalls” into promising market prospect in order to fly higher and go further.