Jed Dorsheimer, a senior asset analyst from Canaccord Adams, discussed the issue of the LED market cycle. The first cycle began in this century in the first few years, mainly by mobile handheld devices, led to illuminate the keyboard, then as a mobile phone color backlight. The sharp increase in LED manufacturing has resulted in overcapacity over the past 2004-2005 years. However, in this cycle to promote the performance of the LED and price drop, in turn to create the second cycle of the LED, that is, as the medium size notebook and large-size TV LED backlight. Based on the rapid growth of the (flat) TV market, Dorsheimer said the LED industry will experience significant capacity shortages, and by 2012 the LED Chip gap will reach 700.1 trillion. A further hundreds of MOCVD capacity is required, and the sapphire substrate should be adequately supplied. Dorsheimer believes that in accordance with the development trend, the future will lead to 30% of LED overcapacity, the need for "one to two years of digestion cycle"; 2014-2016 capacity will not be much increase. History will repeat itself, as led prices fall and performance increases will help the industry to advance to the next cycle, but the driving factor is lighting.