For home entertainment, it believes that LCD and PDP TV technologies will become mainstream, making big dents in direct-view CRT and rear-projection TV technologies. As a result, Sharp is placing a big bet on LCD technology - an area where the company has been a industry leader. LCDs will have an edge over PDP TVs because of lower weight and power consumption and better display lifetimes. In addition, LCD TVs are more environment-friendly as PDPs contain chemicals that are hard to recycle. This may not yet be a major buying concern in the US, but it is in Europe and Japan.

Plans have already been laid to build a new LCD TV factory in Mie prefecture, which, for the first time, will house both LCD panels and TV manufacturing under one roof. This will drive better manufacturing efficiencies, says the company.

But demand is outpacing the company's ability to deliver TVs right. As a result, it is currently refurbishing an assembly plant in Yaita, Japan to increase production of the LCD TVs.

Currently, sales of LCD TVs are dominated by 13-, 15- and 20-inch models. But surprisingly, Sharp's product planning department manager Kazuhiko Sasaki says that unit sales are fairly evenly distributed among these sizes, despite the large differences in pricing. It also recently released a 37-inch model that joins a 30-inch TV.

Sharp is trying to institute what it calls a "spiral strategy." The idea is to boost development and design efficiency, and further enhance the upward spiral effect that results from the synergy of core devices and end-user products. This will help create new classes or categories of products, thus starting a profitable new revenue stream. The fast-response LCD TV is one example of this as is its 1-bit audio and CG-Silicon technology. The latter was recent used to create a VGA-resolution display in a screen size compatible with PDA products - a product category that currently uses QVGA resolution displays.

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