VDC Research Group Industrial Automation and Control Practice A Research Note TOUCHSCREEN SENSORS AND DISPLAYS Prepared by: Christopher J. Rezendes, EVP Industrial Automation and Control Practice VDC Research Group March 2009 All rights reserved A Research Note on, TOUCH SCREEN SENSORS AND DISPLAYS 1 The current IT investment environment may be the most cost-sensitive since the first commercial deployment of the solid state transistor. And yet, demand for solutions with touch screens, which are materially more expensive than traditional displays, are growing rapidly. In a previous Research Note, VDC Research explored some of the highlights of touch screen market acceptance and expansion generally. In this note, we explore the features, functions and benefits that touch screen suppliers are offering that is driving the continued market expansion, revenue growth and sustained profitability of these enabling technologies. To begin, it is important to consider that there is not one monolithic touch screen market, but a collection of segments that are demanding touch technology: • 4-wire resistive touch screen sensors have gained market share due to growth of smaller touch screens in low-cost consumer applications (e.g., smart phones, PDAs). • 5-wire resistive touch screens are more expensive than 4-wire, but have remained the dominant resistive technology, due to advanced clarity and durability. • 8-wire resistive touch screens continue to be used in high-end applications where increased resolution over large displays is required. • Capacitive touch monitors are becoming more popular in harsh environments, due to high optical quality, reliability, and watertight seals. • Emerging technologies such as optical imaging, virtual acoustic matrix, and dispersive signal technology (DST) among others will be thoroughly investigated and their benefits and drawbacks, along with the market implications in certain applications, will be analyzed. So what might drive continued demand for touch, even during the recession? • Touch screens offer technical advantages and commercial value that few emerging substitute technologies can match. Touch screens are displacing traditional keypads and switches that are integrated into embedded computing and control functions. However, few alternative technologies, such as projected interfaces and voice recognition, are displacing the use of touch screens. Projected interfaces using holographic technologies are reserved for niche markets and applications where mechanical switches are not rugged enough, sterilization/ hygiene is important (medical devices), or user interfaces need to be bigger than the device itself. Voice recognition has not yet emerged as a viable solution due primarily to performance and workforce acceptance issues. • Development of new touch screen sensor technologies has been slow – but that could change soon. Resistive and capacitive touch screen sensor technologies remain the most popular solutions, even though their enabling technologies have remained unchanged. However, updated technical solutions have recently emerged: Optical imaging, which allows for multi-touch capability and whole screen coverage - ideal for larger displays; Virtual Acoustic Matrix, which combines both resistive and capacitive technology and enables multiactivation modes, very high accuracy, no membrane nor film and ideal for low powered/cheap displays-large or small; and Dispersive Signal Technology (DST), which uses vibration waves to stimulate touch in large format 40-inch flat screens. © 2009 VDC Research Group, Inc. A Research Note on, TOUCH SCREEN SENSORS AND DISPLAYS • R&D is focused on improving features and functionalities of touch screens in order to meet demand in new high growth applications. Research and development is primarily focused on making touch screens easier to use and more attractive for outdoor and rugged applications. For example, 3M has developed gesture recognition based on its DST platform allowing for image pinching, object rotation, expanding, zooming, and other standard gesture patterns and is ideal for larger displays (CNN uses something similar on their newscast). Touch panel protectors and plastics that improve abrasion resistance while improving the transmissivity for outdoor use are also being developed. • Flexible touch displays to serve nascent markets of the future. Development of flexible displays using specialized plastic substrates will emerge to serve applications in which the user needs or desires the ability to interact with their electronic device while running, skiing, or fighting on the battlefield. 2 ABOUT THE STUDY VDC Research’s 2009 Touch Screens Sensor and Displays: Global Market Demand Analysis is an indepth analysis of global market demand for touch screen sensors and displays, including detailed market definition and segmentation, market estimates and forecasts, end-use device screening model, detailed OEM and VAR/systems integrator requirements analysis, industry structure and analysis of touch screen sensor and display suppliers, and key success requirements for touch screen and touch screen sensor suppliers. ABOUT VDC RESEARCH GROUP VDC Research Group (VDC) is a technology market research and strategy consulting firm that advises clients in a number of technology markets including: Automatic Identification and Data Collection, Embedded Hardware and Systems, Embedded Software and Tools, Industrial Automation and Control, Mobile and Wireless, and Power Conversion and Control. Using rigorous primary research and analysis techniques, the firm helps its clients identify, plan for, and capitalize on current and emerging market opportunities. We strive to deliver exceptional value to our clients by leveraging the considerable technical, operational, educational and professional experience of our research and consulting staff. During our nearly four decades of ongoing operation, we have had the pleasure of serving most of the world’s leading technology companies, many highprofile start-ups, and numerous blue-chip early and later stage investors. 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