Tactical Advice

Lean Toward LCDs

With prices falling, businesses can now justify replacing CRTs with flat-panel monitors.
This story appears in the November 2005 issue of BizTech Magazine.

It's a familiar, ageless cycle: New technology hits a magic price-point and, poof, products built on time-tested, older technology are pushed aside. Think vinyl record albums and CDs, and black-and-white and color televisions. It's now happening with cathode ray tubes (CRTs) and liquid crystal displays (LCDs).

 

Last year, for the first time, LCDs outsold CRTs in the $12.2 billion North American monitor market, according to iSuppli, a market research company in San Jose, Calif. This year, shipments of LCDs have skyrocketed—at the expense of CRTs. For the fourth quarter of 2005, LCD sales will reach 10.2 million displays, while CRTs will rack up only 1.3 million sales, according to iSuppli. That compares to 5.2 million LCD monitors and 4.3 million CRTs sold in North America in the first quarter of 2004. By 2007, iSuppli estimates annual shipments of LCDs will top 45 million versus only 821,000 CRTs.

 

LCD makers, which have been trying for years to bring down the manufacturing costs of LCDs, have finally fine-tuned the process and built so much manufacturing capacity that LCD prices started dropping. Although LCDs are still more expensive than CRTs, the price gap is closing. The average street price today for a 17-inch LCD is about $260, according to iSuppli.

 

 

CRTs remain considerably less expensive—as much as 50 percent less—but the price gap between the technologies has closed at the same time overall monitor prices have come down. So a user can buy an LCD monitor today for about what they would have spent on a comparable CRT just two years ago. What's more, a 17-inch LCD monitor at $260 is comparable to a 19-inch CRT at a price of $190 because the CRT offers only 18 inches of viewable screen and typically runs at a lower pixel format than an LCD, says Rhoda Alexander, director of monitor research at iSuppli.

 

In a New York Minute

 

It was that shrinking price differential that led Jonathan Gleich to start replacing CRTs with LCDs about a year ago at apparel maker Tawil Associates. Once LCD prices fell below $300, it was a no-brainer, says Gleich, management information systems director for the New York City company. "CRTs, as far as I'm concerned, are going the way of the dot-matrix printer."

 

At first, it was an issue of desktop real estate, Gleich says. Tawil began its LCD conversion by replacing monitors in particularly space-constrained areas. But over the next couple of years, the company will replace all the monitors used by its 100 employees.

 

Because of its size and shape, the typical LCD occupies about a third of the footprint of an equivalent CRT. More efficient use of desktop space can make a big difference, especially in small, cramped spaces like call centers and computer rooms. And, the more manageable form factor makes it easier for the systems team and others to move LCDs, whether across the hall or the state.

 

Direct and indirect savings can quickly offset an LCD's higher initial price tag. For one thing, companies save on shipping costs because an LCD weighs only 8 to 10 pounds versus the typical heft of 40 to 50 pounds for a CRT. An LCD is also cheaper to dispose of because it doesn't contain the 4 to 6 pounds of lead found in a CRT.

 

LCDs also have lower energy costs, a factor that is becoming increasingly important given skyrocketing fuel costs. A new LCD draws 40 to 45 watts; that's less energy than a reading lamp and about half what a CRT uses. And because LCD monitors generate less heat than CRTs, companies can expect to reduce associated air-conditioning and cooling costs as well.

 

Thin and Friendly

 

Unlike CRTs, LCDs don't use electron guns to create images, so concerns about radiation emissions are virtually nonexistent. This also makes LCDs ideal for sensitive medical and electronic testing environments.

 

Then there is the hipness factor. Users simply like the look of LCD monitors, with their fashionably thin bezels and sleek edges. That can be a drawback, however. People are drawn to touching the screens, but they are more fragile than CRTs, Gleich says. "I try to remind them that this is just a thin layer of liquid between thin layers of glass."

 

The recent wave of affordable, high-performing LCDs has ushered in a new era of computer displays. CRTs will continue to sell—sometimes inexpensive and durable makes the most business sense. But when it comes to purchasing multiple monitors, companies will be pushing CRTs aside in favor of LCDs.

 

 

CEO takeaway

Here are factors to consider when figuring the possible return on investment from replacing CRT monitors with LCDs:

First, tally the number of CRT monitors you want to consider replacing with LCDs.
Second, figure out whether you will make a sweeping upgrade or phase in the conversion and then take into account the dropping cost of LCDs over time.
Third, take a look at your office layout—for two reasons. One, is space at a premium? Two, are you having to keep the air conditioning pumped up because you have many systems located in close proximity that generate excessive systems heat? Factor these items into your calculation.
Fourth, review the work employees do. If some or all of your team spends the bulk of the day at the computer—especially on design-related work—LCDs could boost productivity by improving screen visibility.
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