Display screen makers that used to wax on about the potential of the big-screen television set market have discovered small screens reap bigger profits.

Cool multimedia mobile phones, glitzy digital cameras and portable media players are proving better at charming consumers into loosening their purse strings than expensive giant televisions.

Makers of large LCDs in South Korea, Japan and Taiwan are still reeling from a slump caused by over-estimating TV demand, but producers of small display panels such as Wintek are counting their dollars.

"When you see more new handsets on store shelves, what do you think that says about demand for small displays?'' asked James Chen, a director at Wintek, the world's fourth-largest maker of small screens for mobile phones.

Investors have ventured an answer - they pushed shares in the small Taiwan company to a 4½-year high in April, underlining optimism over the fast-growing market for small LCDs.

Wintek has risen 31 percent this year, outperforming rivals that focus on making bigger LCDs for computer monitors and TVs. Samsung Electronics is up 8 percent and AU Optronics has risen 13 percent, for example.

Wintek, which counts Nokia and Motorola among its clients but trails behind Samsung SDI, Philips and Seiko Epson, forecasts a 53 percent jump in sales for this year.

``We think growth of displays will be higher than that of handsets because some flip models use more than one display,'' said Chen.

Nokia said in April the phone market should grow by about 15 percent this year to 740 million units, higher than its earlier estimate of 10 percent growth.

Colour displays for small portable gadgets use three main types of technology: super twisted nematic liquid crystal displays, and the higher-end thin film transistor LCDs and organic light-emitting diodes.

Wintek expects STN-LCDs to make up 60 percent of revenue by the end of this year, up from a third in the first quarter because selling prices are three times higher than that of monochrome panels.

Analysts say organic light-emitting diodes produce clearer, smoother video images than LCD technology, making it more suitable for third-generation phones.

A slew of new digital cameras with bigger screens and portable media players that can play movies and music have also come to the market, which DisplaySearch said will help boost output of small displays to about US$24 billion (HK$187.2 billion) in 2009.

That would be up 26 percent from the US$19 billion estimated for this year, according to the United States-based research firm.

``If content providers are ready and we can download movies from the Internet legally, growth of PMPs will be astonishing,'' Clement Law, vice-president at 2001 Technology, said on the sidelines of Computex, the world's second-largest PC trade fair. The firm sells PMPs under its Montego brand.

Lung Hwa Electronics, which showcased a PMP with a 3.5-inch LCD screen, and Premier Image Technology, the island's biggest maker of digital cameras, said they secure LCDs from local and Japanese suppliers.

REUTERS