It is not true that the LED market is slower in the UK than the rest of Europe because it is in fact slow everywhere, according to the CEO of Zetex, Hans Rohrer.

“For widespread usage in general lighting applications the market needs more time. We are competing with a very well established market. LED only now able to enter the general lighting market,” said Rohrer.

He added that competing with an old technology - incandescent bulbs – there will inevitably be a slow transition. “You have to change all the infrastructure of the business. We are really prototyping now but it will be another 18 months before it really gets going,” added Rohrer.

Zetex said that it has been adding to its range of high brightness LED drivers with the development of a driver in partnership with a “major customer”. However, the device is not expected to enter volume production until the second half of 2008.

Zetex announced its interim results last week in which sales were £32m against £33.7m a year ago and group operating profit was £3.2m against £100,000 a year ago. Amid what Rohrer described as a flat first half of the year for the whole industry, the firm has been pushing its R&D efforts.

“We are now in an R&D expansion mode, adding aggressively to our key design people,” said Rohrer. Around £3.3m was put into R&D with a big investment in Zetex’s digital audio chipset and first silicon prototype. The intention is to make the chipset at its own fab and through foundry partners.

The firm intends to complete verification of the chipset in Q3 and sample it to selected customers in Q4. “The design-in process and therefore time to revenues is approximately 18 months, and we therefore expect to see significant financial returns from this technology in 2009 and beyond,” said the firm.

Rohrer reiterated his belief that Zetex will make increasing use of foundry partners, particularly for what he calls the firm’s smart application specific products. His five year plan will see own manufactured product revenues of $160m to $170m and revenues from products at foundries of between $130m to $140m.