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Following on raging LCD TV growth of 95% in 2006, things will cool down to a mere 57% next year, or so say the soothsayers at market research firm iSuppli in El Segundo, California.

LCDs are entering a year of “prodigious” growth, but not as torrid as seen in past, according to iSuppli analyst Riddi Patel. The good news for consumers is that should mean cheaper prices for 35-inch TVs and larger, with lots more 40-inch and 44-inch sets being sold next year. The bad news for manufacturers, and, I suppose, for Best Buy (NYSE:BBY) and Circuit City (CC), which got whacked this holiday on falling prices, is that prices will decline another 30-37 percent for the 40-inch and higher models by the fourth quarter of next year.

The report says some of the low-cost manufacturers will benefit:

Though Sharp Corp. (OTCPK:SHCAY) continues to lead the LCD-TV market worldwide, it has lost its dominance to Philips (NYSE:LPL) and Samsung (OTC:SSNLF) in the North American market and now is ranked No. 3 in that market. OEMs like Philips, Samsung and Sony (NYSE:SNE) are aggressive in reacting to the market needs and changes as well as maintaining aggressive pricing when compared to Sharp. Value brands will continue to make their presence known, already accounting for more than 20 percent of overall LCD-TV shipments in the third quarter of 2006. Declining prices will not cause these value brands to disappear and, in fact, may promote their further encroachment into the market due to their low-cost orientation.

And manufacturing equipment fanatics take note: manufacturing capacity will be added:

LCD panel makers are increasing their support for the large-screen television market by upping their capacity at seventh-generation and more advanced fabs.

Today shares of Circuit City are down about 2% at $19.50, while shares of Best Buy are up just under 1% at $49.55.

Source: iSuppli: More LCD Pain On The Way