The demise of LG Philips Displays has been due to a revolution which has seen demand for flat and plasma-screen televisions overtake traditional sets. Julia Breen and Dan Jenkins report.

LIVING rooms around the world are starting to do away with the traditional bulky TV set, in favour of a space-saving flat screen mounted on the wall.

The rise of flat screens represents the biggest change in television buying habits since most people switched to colour in the 1970s.

Demand for flat and plasma screen sets is increasing by 150 per cent each year and prices of traditional sets have dropped by up to 40 per cent, according to regional development One NorthEast.

In the global market, more than 80 per cent of TV sets are still built with tubes.

But LG Philips Displays said last month it expected the market for cathode ray tubes to shrink by 11 per cent this year.

Flat screens are expected to account for 40 per cent of European demand for televisions by 2008, compared with four per cent in 2003. Sales of flat screen computer monitors overtook tube-based displays last year.

David Allison, One NorthEast director of business and industry, said: "The disintegration of world demand for so-called old technology 'fat televisions' has hit LG Philips hard, as well as every other manufacturer across the globe in this sector, and meant that the Belmont plant was no longer viable."

LG Philips tried to compete by introducing a 30 per cent thinner tube display last June, investing £3m in new equipment. But the cost of manufacturing in the UK made it unattractive to customers.

The company will continue with the line, but production will be switched to China.

The rest of the lines produced at Durham will be discontinued. Despite the urging of the board at its Durham plant, bosses could not persuade LG Philips to manufacture its new technology there.

Davey Hall, regional secretary of union Amicus, said: "The company have brought this on themselves. There is not a single flat screen TV made in the whole of Europe or America and I am gob-smacked at that.

"LG Philips had plenty of time to invest in Durham and this shows a lack of commitment."

Lew Dawson, 62, of Brandon, Durham, has been at the plant since it opened in 1962.

He said: "We knew sooner or later that plasma screens would take over. It just came a bit faster than expected."