LEDs: An industry in need of illumination? Three suggestions for industry changes

by Jim Greig, Global Sales and Marketing Manager Electronic Materials, LORD Corporation

Since Thomas Edison’s development of the first functional incandescent lightbulb in the late 1800s, the Edison screw bulb is how we have illuminated our homes and businesses.

Now, more than 125 years later, the lighting industry is undergoing another profound change – the directive to cease manufacturing incandescent bulbs. As of January 1, 2014, manufacturers could no longer legally make 40-, 60- or 100-watt incandescent lightbulbs for sale in the U.S.

Jim Greig, Global Sales and Marketing Manager Electronic Materials, LORD Corporation-photo

Jim Greig

So there you have it – you can only purchase an incandescent bulb until the supply runs out. Even if you have stockpiled a huge supply of incandescent bulbs, you’ll eventually have to replace them – with another type of light source, such as an LED bulb.

But is the LED industry doing all it can to keep prices amenable for the average consumer? Are they educating the public on how to buy LED lamps and helping them to understand the benefits? Are they standardizing LED lighting terminology? Are design changes to the LED bulb necessary or even viable?

I lie awake at night (with the lights out) thinking about these questions. I don’t really have the answers, but I think the questions need to be asked.

From a supplier’s perspective, the price pressure from LED manufacturers is getting really crazy. There is a lot of pressure from manufacturers to bring the costs down for materials used to manufacture the LED bulbs and fixtures. Manufacturers are looking to lower production costs so they can lower the price and spur mass adoption by the public.

And I get that – but I’m also concerned that if we drive down prices too far, are we risking quality just to make a cheap LED bulb? Are manufacturers cutting corners in production and not testing to specifications?

At what point do we say that there is no more money that can be squeezed out of the material suppliers – the price is the price. What is the tipping point? Price is being driven out of everything – at what point does it become untenable for a supplier to supply materials?

I believe there are three areas where the LED industry needs to update its thinking: design, terminology and education.

Design: Perhaps there are there other ways to bring down the price of LED bulbs. Are we “stuck” with the design we have been using. Does the LED bulb have to be on the Edison screw-in connector base? In Europe, they use a different type of base – and maybe that design is more cost-effective. Is it purely a material cost that will drive down the cost of LED bulbs, or do we need a fundamental shift in design? Realistically, it seems that it would not be practical to begin changing the Edison screw-bulb design. Maybe some innovative lighting designer might be able to invent an adaption of the socket or lamp fixture – make some fundamental changes in the design of a bulb.

Terminology: There is a lot of confusion among consumers about which LED bulb to purchase. Has the LED industry sufficiently articulated the payback period of the bulb so that consumers understand the benefits? There are no standards among the LED manufacturers for terminology describing LED bulbs. The packaging descriptions can be very confusing to consumers. Should you buy a 10-watt LED bulb or the 60-watt equivalent? And what does an 8-watt or 12-watt bulb mean in relation to how much light output is expected? What does lumens-per-watt mean? I don’t think that the consumer really understands how to purchase an LED bulb.

Education: Is the LED industry educating the consumer on which LED bulb is right one to buy? Has the LED industry sufficiently articulated the payback period of the bulb so that consumers understand the benefits? I’m not seeing a lot of advertisements, literature or public service announcements making the case for how much energy or money is saved with the purchase of an LED bulb.
How do we drive mass adoption? LED manufacturers are trying to find the “hook” that will attract the consumer, but how can they do that if they are not working together as an industry?

Are we inadvertently developing a “contraband” industry of illegal LED bulb sales? When LED bulbs do go on sale, many of the retailers have to limit the amount that can be purchased to prevent mass purchases that are then resold online or in a “back alley.”

So instead of considering changes to LED bulb design, or working on industry standards, or developing educational programs for consumers – is it fair for manufacturers to keep asking the supplier to charge less for its products? Suppliers are also hit every year by rising raw material costs and labor and production labor costs – but we are still being asked to keep our prices down.

It’s all about costs. Everyone wants to make a profit at the end of the year – but if no one does – no one wins and everyone loses.