market impact of solid state lighting technologies

Disruptive LED and HighDisruptive LED and High--Tech Control Technologies Set to Tech Control Technologies Set to ReRe--invent Lightinginvent Lighting

Mousumi Dasgupta & Sumit Kumar Pal, Research Analysts, Technical Insights

Market Impact of Solid State Lighting Market Impact of Solid State Lighting TechnologiesTechnologies

Research Analysts, Technical Insights

© 2013 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property of

Frost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.

Mousumi Dasgupta

Functional Expertise

• Detailed oriented analytical and research skills which includes market and technology analysis within the

• Automation and Electronics domain.

• Generating research service reports and technical alerts.

• Track and analyze the technological trends in nanotechnology, microelectronics and sensor technology.

• Proficiency at tracking latest upcoming technologies and their impact on the global business scenario.

• Have provided market intelligence and insights to clients including competitive market strategies &

recommendations.

• Proficiency at grasping new technical concepts quickly & utilizing it in a productive manner..

Industry Expertise

� Experience base covering broad range of developments in the field of sensors, leveraging long-standing

2

� Experience base covering broad range of developments in the field of sensors, leveraging long-standing

� working relationships with industry participants as well as university researchers.

� - Sensors

� - Microelectronics

What I bring to the Team

• Technical expertise in the field of automation & electronics.

Career Highlights

• Research Analyst in Automation and Electronics – Technical Insights group of Frost & Sullivan since 2011.

Education

• Masters of Technology in Instrumentation & Control Engineering from University College of Science & Technology, Calcutta University, India.

• Bachelor of Technology in Instrumentation & Control Engineering from University College of Science & Technology, Calcutta University, India.

• Bachelor of Science in Physics from Lady Brabourne College, Calcutta University.

Mousumi DasguptaResearch AnalystAutomation and Electronics

Frost & SullivanSouth AsiaKolkata, India

Sumit Kumar Pal

Functional Expertise

• Detailed oriented analytical and research skills which includes market and technology analysis within the Automation and Electronics domain.

• Generating research service reports and technical alerts.

Industry Expertise

• Experience base covering a broad range of sectors, leveraging long-standing working

relationships with leading industry participants’ Senior Executives in

• Sensors

• Microelectronics

What I bring to the Team

3

• Technical expertise in Electronics and Instrumentation

• Strong Problem Solving and Analytical Skills

• Presentation Skills

Career Highlights

� Research Associate in Automation & Electronics – Technical Insights group of Frost & Sullivan since April 2012

Education

� Post Graduate Programme in Business Management from Praxis Business School, Kolkata, India

� Bachelor of Technology from Future institute of Engineering and Management, West Bengal University of Technology, Kolkata, India

Sumit Kumar PalResearch Analyst

Technical Insights

Frost & SullivanGICChennai

Agenda

LED Lighting – Industry Overview

Promising Growth of LED Lighting

Revenue Forecast

Key Application Areas and YOI

Challenges and Initiatives

Focus Areas

4

Focus Areas

IP Innovation Timeline

New Opportunities -- Convergence Scenario

Impact of Megatrends

Emerging Market Needs

Conclusion

LED Lighting

SignificanceOverview

� Currently electricity generation is one of the mainfactors contributing to greenhouse emissions andlighting consumes about 1/5th of the total electricityproduced.

� A conservative study published by DOE (Departmentof Energy) states that LEDs have the potential toreduce yearly electricity consumption by 190terawatts-hours in United States (US). LEDs can thusfurther reduce greenhouse gas by at least 10% overthe next 5 to 10 years.

� LED light source is regarded as a viablealternative for incandescent bulbs, fluorescentlights and HID (high-intensity discharge) lampsdue to its enhanced performance and longer lifetime.

� According to the latest United Nations Environment Programme (UNEP) report, LEDs have the potential to save US $108 billion dollar by 2030 and reduce CO2 produced by 110.98 million cars.

5

BenefitsMarket

Impact

� Supported by government initiatives andlegislations, LEDs are expected to be adoptedin public lighting by 2015.

� Residential applications depend on manydivergent factors such as size, efficiency andprice and wide scale adoption is expected by2020.

� High energy efficiency potential

� Light intensity control

� Long lifespan

� Directionality

� Durability

Energy Efficient LightingWhy LEDs Promise Dramatic Growth

Highly Inefficient Highly Efficient

Incandescent Lamp Metal HalidesFluorescents LED lamps/retrofits LED Fixtures

The LED Promise

Moving Towards Higher Efficiency

6

Advanced solid‐‐‐‐state lightingcould cut present‐‐‐‐day electricityconsumption by about 70%.

Global Adoption Scenario

49.541

6.1 5

60%

70%

80%

90%

100%Europe

North America

Regional Market Lifecycle AnalysisLED Lighting Market: Per Cent of Revenues by

Geographical Regions (World), 2011 and 2015 Japan and China

dominate the global

market share with a

technological edge and

large population,

respectively.

Europe is leading the

developed world in the

adoption of LED, which

will witness a marked

increase in penetration

into overall lighting.

The US and Canada

7

23.628.7

20.8

25.3

0%

10%

20%

30%

40%

50%

60%

2011 2015

Asia

ROW

Source: Market participants and Frost & Sullivan analysis.

MaturityDevelopment Growth Decline

Time

Ma

rke

t P

en

etr

ati

on

The US and Canada

constitute the fastest

growing region, especially

in the commercial and

industrial, and the retail

and hospitality sectors.

In the Middle-East and Africa

(MEA) and Southeast Asia

(SEA), the growth in tourism,

trade and construction

industries has driven the

commercial LED market.

Where is the LED Opportunity – Key Application Areas

Street,

Tunnel and

Roadway

Lighting

YOI2013 2020

Public Parking

Museum Lighting

Architectural

Lighting

YOI2013 2020

Office Lighting

Retail, Hotel and

Restaurant Lighting

Public Lighting Commercial Lighting

8

YOI2013 2020

Hazardous

Location/Sites

YOI

Industrial Lighting

2013 2020

Production Floor

Warehouse

YOI2013 2020

Under

Cabinet/Shelf

YOI

Residential Lighting

2013 2020

Recess Lighting

Mood and Decorative

Lighting

However, Penetration is Still <10%Penetration Challenge

77.0%

23.0%

Other Lighting

2012 Global Electricity Consumption by Lighting and LED Penetration

9

16

710

58

Operati

ng

hours

New

installa

tions

Retrofit

fixtures

Replace

ment

Lamps

Strategic direction of

the market, key

developments

Drivers & Restraints,

Technological and

economic trends

9

Other Lighting

Lighting presents a vast opportunity

to reduce energy consumption

Global lighting market is significantly

underpenetrated by LEDs

Incandescent Flouroscent CFL LED Others

Source: Market participants and Frost & Sullivan analysis.

Low penetration attributed to the nascent stage of LED technology and the dominance of other technologies in lighting.

Market penetration for LED lighting will increase when LED products can truly compete with incumbent products on price and performance.

Technology is key to increasing penetration of LEDs

Total Market for

LEDs in General

Lighting

Challenges

High Initial Cost

Technical Challenges

Low Awareness

Lack of Standards

Challenges Hindering Adoption

10

Dominance of Fluorescents Capital Investment

HighLow Medium

Impact

Although the challenges cited relating to the newness of the technology are certainly cause for concern, the

biggest disadvantage right now is still the product's high price. Based on its soaring popularity so far, it looks

like the market has decided the pros outweigh the cons.

High High

Initial Initial

CostsCosts

Advanced materials and sophisticated components

across the LED supply chain lower lamp and LED

package costs dramatically.

Key Initiatives and Trends in Addressing Challenges

Technology Technology

Efficacy Improvement -- Department of Energy

estimates placing commercial LED efficiency as high

11

Technology Technology

IssuesIssues

estimates placing commercial LED efficiency as high

as 258 lumens per watt by 2020

R&D to address thermal management

AwarenessAwareness

Governments at all levels making LED and smart control market acceleration a policy

priority, to remove the final obstacles and catalyze transformative scale-up.

Investment Investment

ScenarioScenario

Global venture capital investments in lighting have

been steadily increasing over the past four years

Technology Focus Areas Innovation Timelines Based on Patent Activity

LED fixtures

LED lamps and

modules

Thermal

Management/

Heat Sinks

Drivers and Disaggregation of driver functionality into sub-Disaggregation of driver functionality into sub-

modules; Improve electrical efficiency– enables

Improving durability at higher temperatures

– interface materials, mounted sinks or vent

holes can offer results

Insta

llatio

ns

Insta

llatio

ns

General lighting already penetrated by LED lights; retrofit

market continues to grow with large participants

developing IP

Shift from light source

replacement to new

fixture installations

12

Drivers and

Controls

Substrates and

Packaging

Materials,

Phosphors

2015 2017 2020

Luminescence emitting phosphors for

high extraction; Improving luminous

efficacy

Luminescence emitting phosphors for

high extraction; Improving luminous

efficacy

building automation

modules; Improve electrical efficiency– enables

building automation

Lower production costs through new

substrate materials; Downsizing LED

packages

Convergence Scenario #1Convergence with Internet of Things

Communication

Microchips

Connected Lighting

Industry Initiatives

• GreenWave offers its own

Connected Lighting, Home

Monitoring and Energy

Management services.

• Philips has introduced Hue, a

Wi-Fi-enabled LED lighting

system that allows the user to

control power, color, and

13

Communication

TechnologyConnected Lighting

with LED lights being

controlled via

Smartphones

control power, color, and

brightness of the lighting

system through one’s mobile

device.

Year of Impact– 2018 -

2019

• Widescale adoption is expected

to happen around 2019

Convergence Scenario #2Building Automation

Energy Harvesting LED Lighting

14

Wireless Sensors

• Occupancy• Ambient Light

Building Management System

Year of Impact: 2017

• Widescale adoption is expected

to happen around 2017

Industry Initiatives

• Various companies are

working on energy harvesting

for indoor sensors.

• Key initiative have been taken

by the Enocean Alliance to

realize a platform for product

development

Impact on Mega Trends

Impact - High

Urbanization

Impact - Medium

“Smart” is the New

Green

Beyond BRIC: The Next

15

Social Trends Beyond BRIC: The Next

Game Changers

Impact - Low

Connectivity and

Convergence

Health, Wellness, and Well-

Being

Market Needs & Emerging Technologies

Technologies which have

implications on the overall cost and

impact wider segments, especially

the residential sector will become

more important.

Improving light source efficacy

GaN on Silicon Flip Chip

Market Needs Technology Focus Areas

16

Improving light source efficacy

through

• New substrate technologies

• Chip design alternatives

Consumers are increasingly being

interested in controlling lights as

per their moods/thoughts and thus

it is creating an opportunity

embedded intelligence in the form

of wireless

drivers/microcontrollers.

Chip on Board (COB)

Remote Phosphor

Embedded Intelligence/

Smart Lighting

Analyst Insights

““ValueValue--

Added” Added”

LightingLighting

� Integrated controls and Internet of Things (IoT) are generating a lot of interest, especially with the advancement of Home/Building Automation.

� Smart functions has the potential to increase beyond the forecasted period.

There is significant Research

• Differentiation at the chip & packaging level influences

17

CostCost--Down Down

ApproachApproach

� There is significant Research happening especially by new companies like DaintreeNetworks on the controllers but this is going to be a niche area in the timeframe analyzed. However Smart functions has the potential to increase beyond the forecasted period.

technical advancements further down the value chain.

• Most Tier 1 R&D players are focusing on research in the Chip / Packaging level.

• The reasons attributed are substrates offer biggest productivity gains and packaging is the area offering biggest cost reduction in the long run.

Next Steps

Develop Your Visionary and Innovative SkillsGrowth Partnership Service Share your growth thought leadership and ideas or

join our GIL Global Community

18

Join our GIL Community NewsletterKeep abreast of innovative growth opportunities

Phone: 1-877-GOFROST (463-7678) Email: [email protected]

Your Feedback is Important to Us

Growth Forecasts?

Competitive Structure?

What would you like to see from Frost & Sullivan?

19

Emerging Trends?

Strategic Recommendations?

Other?

Please inform us by “Rating” this presentation.

Follow Frost & Sullivan on Facebook, LinkedIn, SlideShare, and Twitter

http://www.facebook.com/FrostandSullivan

•https://www.linkedin.com/groups/Technical-Insights-3197215

20

http://twitter.com/frost_sullivan

•https://www.linkedin.com/groups/Technical-Insights-3197215

http://www.slideshare.net/FrostandSullivan

For Additional Information

Liz Clark

Corporate Communications

Energy & Environment

(210) 477-8483

[email protected]

Nicolas Votano

Sales Director

Technical Insights

(212) 402-1813

[email protected]

21

Angie Montoya

Marketing Webinar Coordinator

Marketing

(210) 414-3395

[email protected]