Market researchers see tough times ahead for LCD makers

April 02, 2013 // By EDN
In the cause of promoting the forthcoming event “OLEDs LIVE!, Raghu Das, CEO, of IDTechEx, has been looking into his crystal ball and forecasting drastic changes amongst the “panel makers” - he calls the summary “OLEDs and the beginning of the end for LCDs”.

LCD panel makers in Taiwan, Japan and Korea have been suffering. Despite the growing demand for LCDs the high number of panel makers and new competition from China has resulted in tough price competition for panel makers, to the point that many panel makers are no longer profitable. In 2012, Samsung Electronics moved their LCD business units into a separate entity. One report suggests that the Taiwanese have invested $60 Billion in the LCD industry and seen a return of just $40 Billion. Some Japanese makers, despite having superb technology, have seen recent losses in some cases equal cumulative profits of the preceeding 5 to 10 years. Restructuring is therefore afoot. In the last few weeks Samsung purchased a 3% stake in Sharp. Japan Display Inc (JDI), puts together small and mid sized LCD panel manufacture units from Sony, Hitachi and Toshiba, focusing on automotive, cellphone and digital camera displays (not TV). Meanwhile, the Chinese are quickly moving into LCD panel production. For many years the top five in the LCD business, in order, were Samsung, LG Display, Innolux, AUO and Sharp. Now, as evidence of China's progress, in late 2012 Chinese BOE is number 5 for notebooks and monitors and China Star (CSOT) number five for TVs.

All this, says Raghu Das, has driven panel makers to seek differentiation. 3D capability was one - albeit with mixed consumer interest. Now the hot topics are OLED and high resolution LCDs (4K).

OLED TVs pose a tough manufacturing challenge, but then the winners will be the ones to address the tough options. The current approach being taken by some of the leading panel makers are as follows, but the situation is fluid.

- Samsung is developing RGB (LEDs) and polysilicon TFT backplane – the company recently announced it is reviewing other options

- LG has opted for white OLED with colour filters and IGZO (indium gallium zinc oxide) TFT backplane