LG.Philips LCD Co. Ltd., a joint venture by LG Electronics and Philips Electronics, announced its $5.03 billion deal with Hewlett Packard, world’s second largest PC OEM. LG.Philips, world’s second largest LCD maker, said it will supply HP with LCD panels for the company’s notebook and desktop computers until May 2008.

Industry analysts said this deal could help LG.Philips compete against Samsung for the number one position. Analysts further added that HP’s contract alone would generate 20 percent of LG.Philips average annual revenue. Moreover, industry analysts believe this could improve the outlook on the LCD industry as a whole. "The deal could be seen as a sign that the LCD industry outlook is improving," said Jeff Kim, Analyst, Hyundai Securities. "It's an opportunity for LG.Philips to expand in the notebook PC market. For HP, they should get better terms with LG.Philips than with Samsung."

According to online reports, this deal also proved to be successful for HP in terms of contractual agreement. Analysts said HP couldn’t possibly have gotten a better deal from Samsung.

LG.Philips is excited to have this contract from HP. "This large long-term agreement further strengthens LG.Philips LCD's presence in the notebook PC and monitor LCD market. It will assist us in claiming a top position in the notebook PC market," LG.Philips said in a statement.

HP commented that its deal with LG.Philips would also help the company grow further. "This strategic agreement with LG.Philips LCD is a key to our continuing growth in the notebook and display market by enabling a stable supply of high quality and advanced technology products," said Kirk Moul, Vice President, HP.

HP and LG.Philips declined to reveal further details on the contract.