Falling retail prices for LED light bulbs have put the LED driver IC market under pressure, according to industry sources. Some LED driver IC suppliers incapable of lowering their manufacturing costs will be forced to leave the market in 2015, the sources indicated.

Average retail prices for LED light bulbs are set to fall to as low as US$3 from the about US$6 currently, the sources noted. Despite a growing market for LED light bulbs, LED driver IC firms will find it more difficult to generate profits in 2015.

For LED driver IC providers, the ability to lower costs will be key to winning more orders in 2015, the sources said.

Several Taiwan-based LED driver IC suppliers have managed to expand their shipments in 2014. However, much of their revenue and profit growth have been eaten up by falling product ASPs as clients continue to demand for lower prices, the sources observed.

Contract chipmakers and backend houses are also being affected by a price war for LED light bulbs. LED driver IC firms tend to negotiate lower prices with their foundry and backend partners to save costs, the sources indicated.