Will LCD panel price-fixing scandal mean lower prices?

Editor’s Note: The following article is reprinted from the Today @ PC World blog at PCWorld.com.

The U.S. Justice Department announced this week that a Taiwanese maker of thin-film transistor-liquid crystal displays (TFT-LCDs) has agreed to plead guilty and pay $220 million in fines for its role in a conspiracy to fix prices of LCD panels. Chi Mei Optoelectronics joins five other companies that have pleaded guilty or agreed to plead guilty in the conspiracy, which fixed worldwide panel prices between Sept. 14, 2001 and Dec. 1, 2006.

Since the price-fixing plot ended three years ago, it seems unlikely that the Justice Department action would have a significant impact on today’s panel prices. Or would it? Certainly, the investigation sends a strong message to major LCD manufacturers, including Epson Imaging Devices, Hitachi Displays, LG Display, and Sharp, all of which played a role in the plan.

The criminal fines in the case total more than $860 million—more than a hand slap—and nine executives have been charged in the ongoing investigation. Hopefully, tech companies will think twice before trying a similar anti-consumer scheme in the future.

Display industry analyst Richard Doherty of market-research company The Envisioneering Group says that while price-fixing events are rare, they do occur. Today’s worldwide economy may expose cultural differences—and diverse court systems—that impact consumers directly.

“Some practices that have not flown in American policy for more than a hundred years are taken for granted overseas,” Doherty says. “A European company like Philips can actually bribe a Chinese official. It’s legal under Dutch law—and it’s tax-deductible.”

Ultimately, however, market forces—and maybe a little legal muscle—will overwhelm a few companies’ anti-competitive actions. The good news is that consumers will find many LCD TV and monitor bargains this holiday season.

Contact Jeff Bertolucci via Twitter (@jbertolucci) or at jbertolucci.blogspot.com.

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