Taiwan-based LED chip maker Lextar Electronics expects LED lighting applications to account for more than 10% of its revenues at year's end versus less than 5% at the beginning of 2010. Lextar is also looking to integrate vertically to reduce product development time from 2-6 months to 1-3 months, according to the company.

Although in the short term, demand from the LED TV market will outpace that of LED lighting, demand from the lighting segment will be more explosive in the long run, Lextar indicated. In 2011, the LED TV market will reach 89 million units, which, in terms of LED chips, is roughly about 147 million T8 LED light strips or only about 1-2% of the global T8 light strip market. By 2012, worldwide LED TV sales will total 138 million units, which translate to 252 million T8 LED light strips. Judging by the current global T8 light strip market of about 10 billion units annually, LED lighting provides a much larger pie for LED chipmakers.

Lextar pointed out that despite the lucrative opportunity in LED lighting, the industry still lacks standardizations and the market remains fragmented. The emergence of LED technology completely changed the lighting industry. Though conventional lighting companies are finding it increasingly difficult to compete with the more advanced LED products, LED lighting players, which are mostly electronics companies, have yet to completely break into the lighting sales channels. Hence, a comprehensive strategy from chip making and packaging to lighting products, sales and service will be the key to future competitiveness.