Coatings World - April 2012

Shifting Opportunities
for Suppliers of

Conductive Coatings
by Robert Nolan, NanoMarkets LLC

The conductive coatings market for electronics is broad, and a large chunk of it is made up of established materi- als with established products. In these mature materials
markets, there are few really new opportunities; at best, these
sectors are “cash cows” for existing, entrenched suppliers. How-
ever, a few key applications are open to new materials and new
suppliers, leading to real opportunities for new business, and op-
portunities for existing businesses to expand:
• First, the overall conductive coatings market in electronics
is growing, generally in alignment with global economic growth,
and fueled at least partially by growth in the developing world.

• Second, the specific kinds of conductive coatings favored by several of the underlying electronics markets are shifting. This will make it difficult for existing suppliers in some situations, but it also means there are plenty of opportunities for new suppliers, with new materials, to get into the game.

NanoMarkets expects the market to grow from its current size of about $9.5 billion to greater than $19 billion by 2019, at a CAGR of approximately 10. 5 percent. (See tables)

While many of the electronics segments served by the conductive coatings industry generate significant revenues, many are also are characterized by low growth, often low profitability and established supply chains. However, in the past decade, two applications—displays and photovoltaics (PV)—have provided new ways for conductive coatings firms to make money. Today, these two segments account for about two-thirds of the conductive coatings market—a share that is not expected to change much over the next decade. However, closer examination reveals that there are significant changes afoot in both the display and PV sectors that will profoundly reshape the opportunity space for conductive coatings.

solar panels and emerging electronics, the needs for conductive coatings are in a state of flux. In these markets, some conductive coatings firms will make considerable amounts of money by capitalizing on growth in the underlying addressable markets; but the flip side of this scenario is that these markets are constantly shifting ground, and demand for new materials can disappear as fast as it appears. In other words, there are significant risks associated with these markets.

In contrast, the legacy applications offer plenty of examples of existing coating technologies that are less than perfect, yet clearly entrenched and still profitable. Examples are electroless copper coatings for electromagnetic interference (EMI) or radio frequency interference (RFI) shielding and indium tin oxide (ITO) transparent electrodes for displays. These markets present far fewer risks for entering coating manufacturers, but also far more competition and fewer immediate opportunities for building a large new business. Nevertheless, conductive coatings firms that look hard into existing markets are likely to find some new ways to make money.

In addition, there are some important trends in conductive coatings markets that are shifting demand patterns. For example, in the PV sector, there is a growing emphasis on energy conversion efficiency as solar subsidies begin to go away and as panel prices are on a relentlessly downward trend. This shift translates into a need for more conductive, less expensive electrodes. With energy storage also becoming more important,

Applications Driving Growth in Conductive Coatings The key growth areas in conductive coatings fall into two broad categories: fast-growth applications and “legacy” applications. In the fast growing and highly dynamic application areas such as