Demand for LCD TVs will drive the next wave of growth in the LCD panel market, according to analysts.

A new study from research firm IDC predicts that the TFT-LCD market – which includes LCD-TV panels, notebook LCD panels, and desktop monitor LCD panels – will grow by a compound annual rate of 15 per cent.

Last year, the market was worth $24 billion. IDC's Worldwide TFT-LCD Demand and Supply 2004-2007 Forecast predicts that this year total market revenue will grow by 56 per cent to $37 billion, and by 2007 will have reached $42 billion.

IDC TFT-LCD research manager Stanley Jeong said: "The TFT-LCD market is expected to double its current size over the forecast period. Most notably, revenue in the LCD-TV market segment will grow at such a torrid pace that it will exceed the revenue in the LCD-notebook panel market by 2005."

The study found that the most popular panel size for desktop PC LCD monitors during 2004 would be the 17-inch. This will account for 60 per cent of PC monitor demand.

By 2007, 43 per cent of LCD-TV panels will be over 30 inches – up from 4 per cent in 2003.

Most notebooks will feature 14.1-inch and 15-inch panels. According to IDC, the combined market share for these two LCD panel sizes will be 90 per cent from 2004 to 2007. IDC predict that panels under 14.1 inches will disappear before 2007.

IDC suggests that higher unit demand than revenue implies the LCD market will be oversupplied during the forecast period. The analysts predicts price erosion from 2005.