If I'm reading your question right, "yes, Casio has started using LEDs to illuminate the faces of some of their newer models such as the PRW3000, GD-350, and GW-9400." Most of their other (and older) models used their blue-green electroluminescent panel to light the display from the back.
It consumes less energy. The battery will last longer in standard battery powered versions and solar versions as well. It can also give them the opportunity to go to a smaller battery or smaller rechargeable battery.
Like Rocat said, it's the battery factor. EL uses a lot more energy then a LED. You can easily drain the entire watch battery by pressing the EL button repeatedly. The other two factors are manufacturing cost and environmental cost. EL used in a wrist watch is usually a layer of powder zinc sulfide with copper. The material illuminates with high voltage electricity. Since the common watch battery only provides about 3V of voltage, it needs a converter to increase the voltage before able to activate the EL. Some watches you can actually hear this process as a high pitch noise. As you can see, you need chemicals, you need to construct a layer of EL the same size as the display, and you need also circuitry for up-converting the voltage. With an LED is a lot simpler, just need electricity in regular voltage, put it in the corner of the display, done!
With that said however, EL is a lot more pleasant to the eyes! It provides an even illumination throughout the entire display. LED however, a lot of time gives uneven lighting to the display. Some cheaper Casio watches for example, you can see one corner of the display is a lot brighter than the others, because that's where the LED light is located.
Also want to add, years ago there used to be a few models of Casio watches that had EL on an analog face. They're either discontinued or harder to find. Casio don't seem make any new models analog EL watch any more. One guess is that they went into some patent infringement issues with Timex (Indiglo), which has the largest collection of EL analog watches.
Like I said in my previous post, EL is a lot more pleasant to the eyes. I hope Casio will continue using that on digital and analog watches, continue to perfect that technology rather than going backward with LEDs!
The technology already exists, all cellphone and mobile device screens are edge lit by SMD LED's that shine into a light diffuser made of a grooved acrylic panel sandwiched by reflectors on either side. They probably don't use it because it requires a matte white reflector behind the screen instead of the sparkly grey stuff old school LCD's use.
Something like this will do, just need to shrink it down to fit in a watch.
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