Apple iPhone, Asia demand create touch-screen boom

The launch of the first iPhone model a year ago boosted interest in the technology tremendously, and the updated model available Friday likely will stoke enthusiasm further. Now touch-screen manufacturers are going flat out, and more devices will soon be controlled by the tip of your finger.

"After the iPhone came out, a lot of mobile-phone companies said 'Oh, I can make that kind of touch-screen mobile phone, too,'" said Jennifer Colegrove, analyst at iSuppli Corp.

In the U.S., Sprint Nextel Corp. just introduced a touch-screen phone, the Samsung Instinct, that's very reminiscent of the iPhone. Verizon Wireless this year introduced its first two phones that use touch screens as their main interface. Research In Motion Ltd. is believed to be making a touch-screen version of the BlackBerry. Sony Ericsson is bringing out its first touch-screen model in a few months.

Jon Mulder, product marketing manager for Sony Ericsson's U.S. arm, said touch screens have become a "hygiene factor"--a must-have for phones that want to compete in the high end of the U.S. market.

Colegrove projects that 341 million touch screens will be shipped worldwide this year, up from 218 million in 2007 and 81 million in 2006.

In the first half of 2007, before Apple Inc.'s iPhone launched, a big maker of touch sensors for portable electronics would make perhaps a million units per month, Colegrove said. "Then in the second half of 2007, suddenly they received huge orders, so they ramped up their production to maybe three or four million units per month."

Apart from the iPhone, demand for touch screens is driven by new phones in Asia that allow the user to write Chinese or Japanese characters on the screen, usually with the aid of a stylus. That's much easier than entering those characters with a keypad, Colegrove said.

Most touch sensors are made in Japan, Taiwan and China by companies that are relatively unknown in the U.S., like Nissha Printing Co., Wintek Corp. and Truly Semiconductors Ltd.

Balda AG of Germany supplied the touch sensor for the first iPhone through a joint venture with a Chinese company.