SAN JOSE – Defying challenging economic conditions, the global LCD-TV market is expected to continue its rapid growth during the coming years, causing it to become the largest segment of the consumer electronics industry by 2012, according to iSuppli Corp.

Worldwide OEM factory revenue for LCD-TVs will rise to $110.8 billion in 2012, nearly double the $61 billion in 2007, predicts Sheri Greenspan, senior analyst, consumer electronics for iSuppli.

In 2012, LCD-TV revenue will exceed that of consumer appliances, marking the first time the vast appliance sector has not been the top money generator in the consumer electronics industry since the firm began gathering data on this market.

At present, LCD-TV is the 2d largest revenue-generating segment of the 20 consumer electronic product categories tracked by iSuppli.

“The consumer electronics market will continue its incremental growth over the next four years, driven by LCD-TVs, along with consumer appliances, digital set-top boxes, digital still cameras and video game consoles,” said Greenspan.

Factors driving LCD-TV shipment growth include the global transition to digital broadcast, rapidly declining prices, and consumer preferences for high-definition displays and thin form-factor sets.

Greenspan noted global consumer electronics OEM factory revenue rose 2% last year and is expected to increase another 6.5% in 2008.

In parallel with the rise of the LCD-TV market will be the expansion of the digital STB segment.

“Global digital STB factory revenue is expected to grow to $25.6 billion by 2012, rising at a CAGR of 11% from $15.2 billion in 2007,” Greenspan said. “Consumers continue to upgrade their televisions with new premium services, like high definition and video on demand, requiring new STBs.”

Greenspan added shipments of STBs also would be driven by consumer demand for DVR, increasingly becoming standard in set-top boxes.

Other consumer electronics growth areas include digital still cameras, whose revenues will rise to $26.9 billion in 2012, expanding at a CAGR of 6.6% from 2007.

“Growing demand for the higher-priced digital SLR cameras is helping drive overall pricing up, as is continued consumer interest in higher resolution and video-capture capability,” Greenspan said.

Video-game-console revenue is expected to grow to $14 billion in 2012, rising at a CAGR of 5.9% from 2007.

A massive number of CE products are prime candidates to undergo a convergence of functionality; more than 800 million individual consumer electronics products shipped worldwide in 2008 potentially could be affected by some form of convergence, a number that will rise to 1.2 billion by 2012, says iSuppli.