Market Archives ⋆ Page 3 of 3 ⋆ OLED

Samsung Display Expands AMOLED Panel Supply. A Green Light for AMOLED Business?

October 23, 2015/in Market /by OLEDNET

On October 7, Samsung Electronics announced tentative Q3 performance results. The announced sales figure and operating profit are approximately US$ 46,000 million and US$ 7,000 million each. These figures are an increase of 5.07% from previous quarter’s sales (US$ 44 thousand million) and a 5.8% increase from previous quarter’s operating profit (US$ 6,000 million), much higher numbers than industry’s expectations.

Compared to the same period in 2014, operating profit increased by 79.80%, and since last year’s Q4, the rise is continuing for the 4^th quarter. The display business department’s much higher figures than expected is considered to be the main reason for this performance increase.

The major cause for this positive effects is increase in demand for general class AMOLED panel through Samsung Display’s aggressive procurement of customer base; AMOLED panel is applied to Samsung Electronics’ mid to low priced smartphones and there is great increase in AMOLED panel applied products by set companies of other countries such as China.

Due to the increased demand, Samsung Display’s operation rate rose, and it is estimated that this will also greatly affect material companies’ performance improvement.

LG UHD OLED TV Price Falls Once More

September 30, 2015/in Market /by OLEDNET

The price of OLED TV by LG Electronics is falling fast. The 55inch flat UHD OLED TV (55EF9500), released last month, fell to $3,999 in 3 weeks, a 27% decrease from the initial $5,499. This price decrease is much faster than that of LG Electronics’ curved model of 55inch UHD OLED TV released in April.

Samsung Electronics’ 55inch SUHD TV, UN55JS9000, showed approximately over $2,500 price difference in comparison with 55EF9500 between the 1^st week and the 2^nd week of September. However, in the 3^rd week, UN55JS9000 and 55EF9500 each showed 4% and 15% of decrease rate to record $2,497 and $3,999 respectively, with approximately $1,500 difference. This is the highest reduction rate for LG Electronics’ OLED TV.

In addition to the price reduction, LG Electronics is marketing their products aggressively. They are in the process of installing OLED TV this month in 39 key airports in 23 countries including the US, Germany, and Russia, with plans to install approximately 200 units of OLED TV by the end of October.

Q2 AMOLED Market, the Largest So Far

September 21, 2015/in Market /by OLEDNET

According to UBI Research’s Weekly OLED Analysis Report, Q2 AMOLED panels recorded the largest shipment and sales so far. With 56 million units, the Q2 shipment increased by 35% in comparison with Q1, and a 19% increase compared to the same period last year. US$ 2,800 million was recorded for sales, which is a 65% increase compared to its previous quarter.

Last quarter’s AMOLED market growth is due to Samsung Display’s AMOLED panel supply volume for Chinese set companies and increase in LG Display’s flexible OLED panel production for smartwatch.

Q2 AMOLED Shipment

Minus Growth for H1 OLED Material Market with Mere US$ 564 Million*

September 9, 2015/in Market /by OLEDNET

According to UBI Research, the 2015 H1 OLED material market recorded approximately US$ 564 million; this is a 14% increase compared to 2014 H2, but a 24% decrease against 2014 H1.

Despite reports that Samsung Electronics and LG Electronics are selling much larger volumes of flexible OLED applied Galaxy S6 Edge and OLED TV respectively compared to last year, the OLED material market is gradually stagnating.

The main reason for this OLED material market’s downward turn is Samsung Display’s operation level which remained stationary at 50% in H1. This led to stationary material usage compared to the year before. LG Display is producing flexible OLED and large size OLED panel for TV. However, approximately only 100,000 units of OLED panels were sold in H1 and material usage was also lowl. The current capa. is 34K but as the OLED material cost spent in H1 is approximately US$ 36 million, the operation rate is analyzed to be only 30% of the total capa.

The OLED material market is decreasing because the supply price is rapidly falling without increase in production volume. OLED material companies are frustrated at the 10-15% price decrease per quarter. At present, as the only clients are Samsung Display and LG Display, material companies are compelled to reduce the price as the failure to do so could lead toward the termination of business. OLED material companies spend several thousands of millions of dollars annually on development to meet constant improvement demanded by clients. There is much difficulty for OLED material companies as display companies continue with one-sided demands without compensation regarding development cost.

For OLED industry to maintain its continued growth, it requires more than success of panel companies. Material companies that play a pivotal part within the industry have to continue development and production of quality materials in order to create a healthy growth cycle. However, display companies are destroying the ecosystem.

What OLED material companies currently crave is for Chinese display companies to mass produce OLED panels as soon as possible.

* 1 USD = 1,100 KRW

OLED Material Market Revenue 2014 H1 – 2015 H1

Korea’s Large Area AMOLED Manufacturing Equipment Market To Record Approx. US$ 8,640 Million For Next 5 Years

September 1, 2015/in Focus on, Market /by OLEDNET

According to UBI Research’s OLED Manufacturing Equipment Annual Report (published on August 31), the complementary investment market in Korea is expected to record approx. US$ 8,640 million between 2016 and 2020.

According to the report, once Chinese new LCD lines actively begins to operate, panels produced by Korea’s Gen8 a-Si LCD lines are estimated to fall behind in price competitiveness. Therefore, complementary investment should be processed to transform the a-Si LCD line to OLED line. The report estimated that if complementary investment for OLED is carried out, oxide TFT with less masks is the most suitable backplane structure. This has the advantage of utilizing the most of the existing a-Si LCD line. The report also forecast that future large area AMOLED mass production investment will mainly be complementary investment rather than new investment. Complementary investment signifies investing in evaporation and encapsulation manufacturing equipment while using the existing a-Si line backplane. New investment means investing from the backplane stage. The report analyzed that complementary investment will lead to the decrease of large area OLED panel’s production cost.

Investment cost comparison shows that approx. US$ 600 million is required for new investment in Gen8 Oxide TFT key equipment (20K). However, complementary investment requires approx. US$ 80 million and can save the investment cost by approx. 7 times compared to the new investment.

Korean Government, Will It Give Up Its Top Spot in Display Industry?

August 4, 2015/in Market /by OLEDNET

Recent Samsung Electronics and LG Electronics’ TV and smartphone performance results are causing experts to be concerned over degrowth.

The axis that is centering Korean industry is dependent on these 2 companies and Hyundai Motor Company. In the 20^th century when technology skills were lacking, Korean government and these 3 companies closely cooperated and coordinated product development and market cultivation. The low value of KRW invigorated the 3 companies’ export business. Strong government support allowed development of products that could compete against Japanese products occupying the international market. The potential that allowed the companies to overtake Japanese firms that were dominating electronics industry and increase the international market share was based on Korean government’s diverse interest and enthusiastic backing.

Japan’s display industry collapsed due to several reasons. Their pride that that latecomers including Korea will not be able to catch up to their technology, the discontinuation of investment by overlooking the need of the 21^st century of information for display market, and the disregard of latecomers’ price competitiveness can be attributed to the collapse.

Korean display companies gave up on Gen10 investment in LCD business and began localization in China though establishing Gen8 LCD factory in China. However, Chinse display companies, with the backing of their government in large scale, continue to invest despite the deficit.

If BOE’s Gen10.5 LCD factory is complete, China will lead the global industry in terms of yield, and overtake Korea through China’s domestic market and price competitiveness. Now there are only 2 years left. It is only a question of time before Korea’s LCD industry falls apart.

The only thing that is left for Korean display industry is OLED. As Korean display industry plays an important role in Korean economy, the decline of display industry will have direct impact on employment, export, and domestic market.

However, Korean government is currently ignoring display industry. LCD and OLED have been excluded from WTO’s tariff elimination. China, which is rapidly becoming a new contender in display industry, has agreed with the U.S. to exclude LCD and OLED advocating protection of Chinese market and industry, and other countries followed. China is adding 5% tax for 32inch products or larger; Samsung Display and LG Display are operating LCD factories in China in order to be exempt. The labor force is moving away from Korea to China. Korea’s Ministry of Trade, Industry and Energy is overlooking the importance of Korea’s display industry.

To make matters worse, Korean government has no tax regarding manufacturing equipment. When display companies import expensive manufacturing equipment, no tax is added. Recently, due to a low exchange rate of the yen, Japanese companies’ price competitiveness is 1.5 times higher than several years ago. At a time when Korean manufacturing equipment companies are losing heavily in the competition against Japanese, Korean market is actually giving up the market to Japanese companies.

For example, if Samsung Display and LG Display have saved 10,000,000 USD on the purchase of manufacturing equipment, the result is Korean companies’ loss of 100,000,000 USD. Although 10,000,000 USD is a large amount of money to Samsung Display and LG Display, the consequential loss of 100,000,000 USD for Korean manufacturing equipment market is even more immense.

The Korean display ecosystem that has been carefully established is being destroyed by its own government.

Although Korean government is paying lip service to build strong small and medium-sized businesses, in actuality, it is giving small amount of money to large companies and continuing to ignore smaller Korean manufacturing equipment companies. For the future of the smaller Korean manufacturing equipment companies struggling against the weak yen, a system of where they can at the very least survive in domestic market is needed.

Job creation for the young engineers requires more consideration for small and medium-sized businesses rather than large companies that can thrive without any help.

LGD Expands Market Through Active Support of OLED

July 27, 2015/in Market /by OLEDNET

On July 23, LG Display announced its earnings results at LG Twin Towers in Yeouido, South Korea. During this event, LG Display revealed its decision to invest approximately US$ 900 million in Gen6 flexible OLED line in order to lead the flexible OLED market.

LG Display’s CFO, Kim Sang-don, explained that flexible OLED Gen6 line investment was decided at the board of directors meeting on July 22, and was made official on the morning of July 23. Kim added that the decision was reached so that LG Display can lead the OLED business in terms of technology and to occupy initial market in foldable and rollable technologies. He also commented the monthly capa. of the flexible OLED line will be 7.5K.

Regarding large area OLED panel, it was emphasized that this year’s panel production target remains to be 600,000 units and 1,500,000 units next year, same as the ones announced during the Q1 earnings results presentation. It was also revealed that 34K, approximately 9K higher than current capa., will be in operation in 2016. Addressing the concern of oversupply of next year’s 1,500,000 units while the OLD TV market is still small, LG Display suggested the solution of increasing the demand by active promotion from the second half of this year.

Despite the fall of mid to large size panels’ sales price, from the enlargement of sets and AIT technology applied sales performance, the business profit of approximately US$ 4,000 million was recorded. This is a 34% decrease compared to the previous quarter but a 199% increase from the same period in 2014. LG Display estimates that the sales will increase in the third quarter due to seasonal factors and panel’s enlargement trend.

A3 Line Operation Capacity Pushes Down Galaxy S6 Edge Price

July 17, 2015/in Market /by OLEDNET

The price of Galaxy S6 Edge, which initially exceeded approximately US$ 1,200 when released, recorded US$ 739 in second week of July 2015 (source: www.amazon.com). This is more than a 40% decrease in price in about 3 months, and it is analyzed that this is 5% greater price reduction than Galaxy S6, and approximately 13% greater than Galaxy Note 4 Edge.

The period where the decrease is highest is between third and fourth week of April with approximately 23% drop. The biggest reason for this is analyzed to be active operation of A3 line from April. As A3 line began mass producing Galaxy S6 Edge flexible AMOLED panel, the supply shortage issue improved, and yield and productivity increased more than existing flexible AMOLED panel applied to Galaxy Note 4 Edge.

Samsung Display’s current flexible AMOLED panel mass production lines are a section of A2 line and A3 line. It is expected that investment that will convert a part of rigid panel A2 line to flexible will be carried out and the line will be in operation in the second half of 2015. Following this, from the second half of this year, flexible AMOLED panel mass production capacity will further improve and it will become easier to acquire the panels. The industry’s attention is focused on how Samsung Display’s flexible AMOLED line investment will affect the sales of future flexible AMOLED panel applied Galaxy models.

Galaxy S6 Series Price Change Comparison

UHD OLED TV, Rapidly Catching Up to SUHD TV Price

July 8, 2015/in Market /by OLEDNET

OLED TV price, once again, dropped down by a large margin. LG Electronics’ new 2015 model 65inch 4K Ultra HD curved OLED TV (65EG9600) on Amazon (www.amazon.com) fell to US$ 6,999 which is a drop of US$ 2,000 from previous US$ 8,999. The price for 55inch 4K Ultra HD curved OLED TV fell US$ 1,000 to US$ 4,499 from its release price of US$ 5,499. The 2015 new model EG9600 series has panel with improved brightness of 450nit from previous 400nit.

The price of Samsung Electronics’ SUHD TV, similar premium product to LG Electornics’, is US$ 4,997 for 65inch (UN65JS9500), and US$ 2,497.99 for 55inch; there is a difference of approximately US$ 2,000 between LG Electronics’’ UHD OLED TV of same size.

The comparison between 2015 65inch UHD OLED TV and SUHD TV shows that approx. 40% price difference was shown in April 2015. However in July 2015, the difference was approx. 30%, showing that UHD OLED TV price further fell by approx. 10%.

These show that the UHD OLED TV price reduction is occurring rapidly. It is analyzed that the biggest factor for LG Electronics’ UHD OLED TV price fall is production cost reduction due to UHD panel yield increase and competition with set companies that actively began OLED TV sales.

UHD TV Price Trend, Source : UBI Research

[Analyst Column] Korean TV Industry, Where to Go?

July 3, 2015/in Analyst column, Focus on, Market /by OLEDNET

Dr Choong Hoon Yi, UBI Research Chief Analyst, ubiyi@ubiresearch.co.kr

Korean TV industry, according to recent reports by media, is showing a red light not being able to escape the deficit structure.

Samsung Electronics and LG Electronics possess high market share in costly premium TV market. However, in 30inch grade market, the two companies struggle against economically priced sets. In order to maintain sales, Samsung Elec. and LG Elec. are managing diverse product portfolio but business profit keep falling. Due to this, LCD panel stocks produced by Samsung Display and LG Display are steadily increasing.

LCD panel business is sinking into a pit.

What is the reason that Korea’s LCD TV and LCD business values can only become worse?

This can be forecast from looking at Japan’s TV and LCD business. Until the early 2000s, Japan was one of the leaders in electronics. However, Japan’s TV business is gradually dying out. Japan’s leading companies, Sony and Panasonic’s TV business began to be deteriorate because of Korean mid-low price products. In succession, Sony ended up spinning off the TV business, and Panasonic stopped TV business other than for domestic supply. Korean TV companies began to dominate the market. However, only a few years since then, Korean TV industry is losing commercial value, pushed aside by mid-low price products manufactured by China and others.

Second is display investment. As Japanese TV industry began to crumble, Japanese display companies had no choice but to stop the investment. The companies could not see a way to make profit through investment even if TV market grew as client companies’ panel purchasing power fell. Korea is the same. Samsung Elec. and LG Elec.’s TV business profitability deterioration led toward Samsung Display and LG Display’s halting the investment. On the other hand, Chinse display companies began Gen10.5 line investment. TV industry relies on assembly business and business network and therefore initial investment cost is low. In comparison, display industry is high risk as it requires large scale investment from early stages. If the business profit falls without investment cost return, companies face great loss and business closure is also not easy.

The third reason that Japanese TV companies are dying out is because they could not produce premium TV. Sony, which lost its competitiveness in LCD TV, tried to strengthen its market leadership through 4K TV. However, the brand value was already down and with the lack of marketing value, Sony easily gave up the market to companies in pursuit such as Samsung Elec. and LG Elec. LCD TV already had no difference in quality whether it was produced by a Korean or Japanese company, and brand value order had switched. LCD TV quality produced by Chinese companies is already reached the top. They are no longer companies who produce cheaper knockoffs. Furthermore, LCD panel production technology of Korea, Japan, Taiwan, and China can now be deemed equal.

The final reason that stops Japanese TV business from securing market is that they failed to suggest differentiation point in premium TV. Fundamentally, differentiation is not possible for LCD TV. The biggest differentiation factors in the current TV market are picture quality and design. Any company can produce thin LCD TV and curved LCD TV. Panel size, resolution, and QD-LED using color gamut that LCD can actualize can no longer be differentiated technology. The difference of LCD panel and TV manufacturing technology between Korea, Japan, Taiwan, and China is already within a year. No matter what kind of product is released, market control has one year of expiration period. Considering the promotion period required in the market is approximately 6 months, the period where profit can be made is shortened even further.

So what is the solution for the Korean TV industry to survive?

As I have mentioned dozens of times for several years, what is left is OLED TV. What LCD cannot do in terms of picture quality and design, with OLED it is possible. Therefore, only the non-LCD products can enjoy the key factors of differentiation in premium TV market.

Existing premium TV is IPTV, a market that Japanese TV companies have been pursuing since early 2000s. Internet connection is possible through TV and allows for exchange of information in both directions. The basic concept of IPTV is watching TV while searching the information on TV via internet. But how useful is this concept at present? The usefulness of IPTV is becoming increasingly low as smartphone is used to search information, use the internet, and even watch TV. With no reason to use the internet via TV, TV companies should seriously consider whether TV with high white brightness is really needed. Rather than white TV with high brightness, it is time to place more importance in the functions of the TV itself. TV screen only uses 20-30% of full white brightness. Films, with outdoor shooting, falls under 20%, and for contents shot at night, black is more important.

Considering ‘blackness’ and design, anyone can find where the solution lies. If the foolish notion of trying to make OLED as bright as LCD is abandoned, there is hope.

LG OLED UHD TV, SID 2015

Samsung OLED UHD TV, IFA 2013

Korea, China, and Japan’s OLED TV Alliance to Boost the Market

June 19, 2015/in Market /by OLEDNET

Korean companies had been leading the OLED TV industry. Before SID 2015 (31 May – 5 June), LG Display and Samsung Display had been the only companies to reveal 4K OLED panels, and until now, LG Electronics has been the only company to sell 4K OLED TV in large quantity. In terms of OLED TV market, despite OLED’s superior characteristics compared to LCD regarding contrast ratio, high viewing angle, fast response time, and thinness, the market share has been limited mostly due to its relative high price. However, this is expected to change soon.

LG Electronics has been pushing for OLED TV alliance and corporation with Chinese and Japanese companies. As a result, Chinese and Japanese companies resolved to jump into OLED TV market from the second half of 2015. Japan’s Panasonic and Sony are expected to release OLED TV for the first time later this year. China’s Skyworth, Changhong, Konka, and Hisense are expected begin sales from this fall.

Consequently, the number of set companies producing 4K OLED TVs will increase to 7 by the end of 2015. LG Display, the only company that can mass produce OLED panel with 4K resolution, is planning to increase production by 4 times this summer to supply these new to OLED TV set companies.

As mentioned above, until SID 2015, LG Display and Samsung Display had been the only companies which showed 4K OLED panels, and with LG Display being the sole company able to mass produce 4K OLED panels. However, in SID 2015, AUO showed their own 4K OLED panel during an author interview session, and CSOT and BOE presented paper on 4K resolution OLED panel. This signifies they possess technology needed for OLED panel production, and with proper investment they can begin mass production.

Soon LG Display will no longer be the lone supplier of OLED panels contributing toward increase in shipment of OLED panels and OLED TVs. This will naturally lead to lower cost for consumers and energize OLED TV market.

Samsung Display’s Deep Investment Concern for A2 and A3 Lines

May 7, 2015/in Market /by OLEDNET

Due to the shortage in supply of Galaxy S6 Edge from its higher than expected demand, Samsung Display’s worry regarding flexible AMOLED line investment is deepening.

Samsung Electronics’ announced target sales for Galaxy S6 and S6 Edge is 70,000,000 units. If the S6 Edge sales occupies approximately 40%, it is estimated that about 28,000,000 units of S6 Edge will be sold.

Samsung Display’s A2 and A3 lines can produce flexible AMOLED panel that is currently used for S6 Edge. Considering the yield and operation rate, it is analyzed that approximately 5,000,000 units can be produced from A2 in a quarter, and 7,000,000 units from A3 (A2 line = 15K, A3 line = 15K). However, as only A2 was in operation in 1Q, assuming that about 5,000,000 units were supplied, and that A3 will also be operational from 2Q, it is forecast that approximately 12,000,000 units will be supplied. Therefore, it is estimated that A2 and A3 lines have to be in full operation until 3Q to meet the demand for S6 Edge.

However, if flexible AMOLED panel is applied to the new Galaxy Note model in 4Q, the preparation for mass production needs to begin from 3Q. Hence, with the current Samsung Display’s flexible mass production capa., it looks to be difficult to meet the demand for flexible AMOLED panel. Consequently, Samsung’s additional flexible AMOLED line expansion seems unavoidable.

To establish additional capa. Samsung Display could consider replacement investment for A2 line, or expanding the A3 line. If A2 line is replacement invested, the investment cost would decrease and move up the mass production schedule. Nevertheless, the fall in the total market share has to be considered following the reduced rigid panel supply from diminished capa. of rigid AMOLED panel. If A3 line is expanded, the investment cost and time required will be higher but considering future supply to other set companies that are not Samsung Electronics, this is analyzed to be more advantageous compared to the replacement investment for A2 line.

As a result, the industry’s attention is focused on how Samsung Display will choose between A2 line and A3 line, or if both will be carried out.

By DaRae Kim, reporter@olednet.co.kr

LG Electronics, Not Selling OLED TV? Or Can’t Sell?

April 29, 2015/in Market /by OLEDNET

OLED TV business that LG Electronics ambitiously prepared for is remaining at a standstill for more than 2 years. Korean media is reporting that the OLED TV sales in Korea reached 3,000 units per month, but this figure is too weak.

The money that LG Display have invested in line establishment for OLED panel for TV is already exceeding approx. US$ 1,400,000,000. Annual depreciation cost for equipment investment alone, excluding cost of labor and material, is approx. US$ 280,000,000.

Considering the current cost for FHD OLED TV is approx. US$ 1,800 – 3,300, monthly sales of 3,000 units in Korea only result in approx. US$ 9,400,000. With approx. 10,000 units per month being sold in the world, monthly revenue is merely US$ 23,000,000.

Although LG Display is aiming for 600,000 units of OLED panel for TV shipment this year, with LG Electronics’ first quarter world OLED TV sales of approx. 30,000 units, there is concern that only 100,000 – 200,000 units will be sold in 2015.

It is difficult to understand whether this uncommonly low sales of LG Electronics’ OLED TV is because they are not selling them or unable to sell them.

It seems plain that the initial price of OLED TV in 2013, approx. US$ 14,000, was set in order to not sell. LED TV at the time was being sold at approx. US$ 2,800, and the 5 times more expensive price was too high to be considered a normal premium price. Consequently, the 2013 OLED TV market stopped at around 10,000 units, and in 2014 remained around 100,000 units.

At this point, feasible production rate for LG Display’s 55 inch FHD OLED panel needs to be compared. In 2013, LG Display’s M1 line yield rate was approx. 40% with annual possible production of 50,000 – 100,000 units. As the yield rate increased to 80% in 2014, it is estimated that 200,000 units or more would have been produced.

Compared to LG Display’s investment cost and production potential, the LG Electronics’ OLED TV sales results are too shabby.

Of course, as the current main product on the market is FHD, when the newly released UHD OLED TV market actively opens the figures could always change. However, with 55 inch UHD OLED TV having to compete with Samsung Electronics’ SUHD TV, the market is not so easy. SUHD TV costs approx. US$ 3,700, and UHD OLED TV costs about 25% more with US$ 5,100.

Compared to the initial price of FHD OLED TV, approx. US$ 14,000, 2 years ago the UHD OLED TV price is low enough to be quite reasonable. However, with the performance of past 2 years it appears that LG Display might be inadequate to widely open the OLED TV market.

It makes one wonder how Samsung Electronics became the world leading company with their OLED panel equipped Galaxy series achieving 20% mobile market share, a market that used to be dominated by LCD panel.

LG Display Reports Performance, Focus on Structure Differentiation Through OLED TV

April 23, 2015/in Market /by OLEDNET

On April 22, LG Display reported their first quarter of 2015 performance announcing their success in OLED TV market entrance with balanced results in mass production yield rate, timing, and management. They also revealed their panel production targets of 600,000 units this year, and 1,500,000 units in 2016.

LG Display’s CFO Sang-don Kim announced that “OLED TV was about technology innovation until last year, this year it will be innovation in consumers and yield rate, and by next year it will be decided whether it has popularization potential”. He added LG Display will “focus on increasing the business values rather than immediate profit and methodically proceed with OLED focused strategy for structural differentiation in large size display”. He also revealed LG Display will decide on additional investment after observing OLED TV market’s growth potential.

Regarding China’s BOE Gen10.5 investment, a recent issue, he forecast “much time is needed to begin set up and if Chinese companies run into problems while working on enlarging the display it is estimated that they will return to 30inch. Therefore LG Display’s large area panel sales will not be much affected”. He explained in regards to LG Display’s Gen10.5 large area LCD investment that it will be decided after careful examination considering the cost and market maturity.

LG Display also revealed a decrease in sales in small to mid-size display, such as tablet, due to seasonal factors. However for large size display, they announced as a result of improved performance, the total business profit recorded approx. 687 million USD, an 11% increase compared to the previous quarter (approx. 578 million USD), and showed surplus in business profit for the 12 consecutive quarters.

LG Display CFO Sang-don Kim

White OLED Display Market to Grow Rapidly to 150 Million Units Production in 2020

April 16, 2015/in Market /by OLEDNET

Large size OLED TV production is one of the hot issues within the display market. Although OLED has long been a focus for the next generation display, the market share of OLED display is still low. According to UBI Research, a market research company, despite the continued increase in OLED panel production volume and application scope, the point when it moves toward consumer market from producer market will be another leap for the display industry.

UBI Research’s White OLED Display Annual Report (published April 15, 2015) notes that mass production actualization of large size display using RGB structured OLED panel has not been possible due to the dead space from drooped effect. Therefore, UBI Research analyzed that the additional processes and investment cost in order to improve this increases the production cost resulting in decreased competitiveness.

Currently, OLED panel with WRGB structure is being regarded as the only technology that can achieve large size display. As key production companies revealed in SID 2014, concentrated efforts in WRGB OLED research and production resulted in approx. 80% of target yield. In 2015, supply rate is estimated to be 600 thousand units, a 40% increase from 2014, and 1.6 million units in 2016. Chinese key panel companies, led by AUO and BOE, also possess pilot lines for large area WRGB OLED panel mass production including Gen8. (Source: White OLED Display Annual Report, UBI Research)

Solution process applied technology is being developed in close pursuit of WRGB OLED, but UBI Research surmises that it will take 3~4 years for the active mass production competing with efficiency and merits of WRGB structure.

UBI Research forecast WRGB OLED’s unrivaled path will continue for another 5 years or so with approx. 150 million units of WRGB OLED display production out of over 1,000 million OLED display units in 2020. Large size white OLED display panel for TV market is expected to record approx. 1.6 million units in 2016 and grow to produce US$ 13,759M in revenue in 2020 (figures 1, 2).

If the selection of WRGB OLED can solve the RGB structure’s limit in large area panel mass production, possible active OLED TV production is anticipated. With the publication of UBI Research’s report the timing of this is expected to be a point of much discussion. Additionally, further analysis is needed on whether WRGB OLED is really the only technology for large size display, and if so for how long WRGB OLED’s peerless growth can last.

Samsung Elec. and Apple Lead Flexible (Plastic) OLED Industry

April 1, 2015/in Market /by OLEDNET

2015 is forecast to be the year flexible (plastic) OLED actively enters the market. Galaxy S6, which was hugely popular in MWC 2015, is already to have received pre-order for 20 million units. Of these, approximately 50% is estimated to be for Galaxy S6 Edge.

Compared to only several million units of previously released Galaxy Round and Note Edge, the 2015 shipment for Galaxy S6 Edge is anticipated to reach 20 – 30 million units. In order to prepare for Galaxy S6 Edge sales Samsung Display began A3 line operation. Existing A2 line’s Gen 5.5 15K supply and Gen 6’s 15K of flexible OLED panels are to be used. Using these shipment, Samsung Electronics is planning to sell 50% of flexible OLED equipped Edge. What began with Omnia, Samsung Elec.’s lead in rigid AMOLED market is being transferred to their ability to control the secondary flow of flexible OLED market.

Smart phone market’s absolute leader Apple begins the sales of Apple Watch, equipped with LG Display’s plastic OLED, from April. Expected sales volume for this year is approximately 20 million units.

Samsung Elec.’s Galaxy S6 Edge is estimated to cost approximately 1,000 USD, and Apple is releasing various products costing from hundreds USD to thousands USD. If each product from the 2 companies cost 1,000 USD, the total set market is expected to exceed 35 thousand million USD.

The market that these 2 companies will create in this year’s smart device market is quite stunning. Accordingly, the flexible (plastic) OLED panel market is also expected to grow rapidly. Although neither company revealed the panel cost, considering the existing market is staying at 7 thousand million USD the 2015 AMOLED total market is forecast to reach 9 thousand million USD.

Chinese Companies’ Aggressive Chase, BOE’s Active Secondary Investment for OLED

March 26, 2015/in Market /by OLEDNET

It was revealed that public tendering began regarding BOE’s 5.5G AM-OLED project on ICB Operator, a Chinese international tendering network site.

BOE possesses Gen 5.5 AMOLED line in Ordos, and is preparing mass production using SNU’s evaporator. It is analyzed that the additional investment regarding Gen 5.5 AMOLED project has been confirmed as SNU evaporator yield has mostly settled. It is estimated that BOE’s mass production of AMOLED panel for mobile will be able to begin earnestly in the second half of the year.

BOE, OLED Project Public Tender List

<Source: ICB Operator>

Chinese panel companies aiming for mass production of AMOLED panel for mobile in 2015 are Visionox, Truly, Tianma, and EverDisplay as well as BOE. Of these, EverDisplay is known to be already supplying panel’s sample base.

The focus is now on how the active mass production of Chinese OLED panel companies will affect the OLED industry which is currently being led by Korea’s Samsung Display and LG Display.

Chinese Companies Begin Active OLED Panel Production Line Operation

March 23, 2015/in Market /by OLEDNET

The Chinese companies are estimated to begin active production of OLED panels, a market for which used to be dominated by Korean companies. Following this, the market for emitting materials for OLED panels also started shifting.

“OLED Emitting Material Annual Report”, published by UBI Research in March 2015, forecast that Chinese companies will begin mass production of AMOLED panel for mobile in second half of 2015, and large area panel from 2017. Together with China’s mass production of panel, emitting material market is estimated to grow into US$ 560 million in 2015, a 16% increase from 2014, and approximately US$ 2,500 million in 2020.

Emitting material companies that rely heavily on Samsung and LG’s panel mass production are anticipating supply chain advancement to China, and considering business expansion in China in order to increase revenue. Idemitsu Kosan is the most proactive and has already started supplying materials to BOE and Tianma. Duksan Neolux began supplying to BOE’s Ordos factory and deliberating on furthering business in China. (Source: Trend Analysis of Key Material Companies, 2015 OLED Emitting Material Annual Report)

With the expansion of panel market, increased competitiveness by Korean emitting material companies is required to acquire supply chain. This is also when Korean panel production companies need to obtain technology in order to retain their market share against Chinese companies.

Emitting Material Market Share by country: UBI Research

AMOLED Panel Market, to Reach US$ 46 Billion by 2020

February 11, 2015/in Focus on, Market /by OLEDNET

2014 was the year preparing a platform to develop the OLED industry in full scale.

There was a prevalent doubt in the industry until 2014 concerning whether the OLED TV is able to break into the market or not. However, as LG Electronics successfully released the UHD OLED TV, the set manufactures were classified with the companies against LG and incapable of producing the OLED TV. Under this circumstance, the majority of TV set manufacturers including Samsung Electronics exhibited the Quantum dot (QD) BLU LCD TV at CES2015. The night view screen which was the exhibition concept only appeared on the OLED TV was employed on the QD LCD TV chasing the high contrast ratio just like the OLED TV.

In the display for a mobile device, the OLED succeeded in establishing an exclusive market with G Flex2 and Galaxy Note Edge with emphasis on the flexibility feature that LCD cannot even attempt to imitate.

According to the ‘’2015 OLED Display Annual Report’’ published by UBI Research on the 10^th, the total revenue has decreased by 4% compared to the previous year due to the AMOLED panel shipments cut resulting from the low sales of Galaxy S5 in 2014.

Is the OLED industry already in crisis?

Though the OLED industry got wet with rain for a while in 2014, it will begin to solidify its place in 2015. Flexible OLED and TV are the alternatives.

UBI Research methodically analyzed and took a close look at the future of flexible OLED on the ‘’2015 OLED Display Annual Report’’. There are a number of display manufacturers developing products in view of that the rollable display is the final stage of a flexible display. But if the rollable display is to be applied on a mobile device, the cultural components are to go back to the analog age and in terms of technology, it may cause a heating problem as all parts excluding the display are concentrated on the body. For that reason, UBI Research prospected that the rollable product will be used on a large movable screen type display rather than on a mobile device.

Also the ‘’2015 OLED Display Annual Report” of UBI Research forecasts that the AMOLED panel market will grow at a CAGR of 30% reaching US$ 46 billion by 2020. Assuming the OLED panel for TV and tablet PC will take the sales share of 30% respectively in 2020, the report predicted that the key application for the OLED panel market will be a TV and a tablet PC following a smart phone.

The growth of AMOLED panel market is anticipated to accelerated after 2017 given that Chinese manufactures are also likely to invest in full scale between 2016 and 2017 to previse the Korea’s monopoly of AMOLED market.

<AMOLED Panel Market Prospect>

OLED TV, becomes the Quantum Dot TV just by placing a dot in the name?

December 16, 2014/in Market /by OLEDNET

Though they are a part of sales gimmick, extremely deluding names are emerging.

For OLED TV, the technology name “OLED” makes it easier for a consumer to recognize the differences of TVs precisely as it uses the OLED panel which is a spontaneous emission method employed to realize brightness and color. In the beginning of last year, LG Electronics and Samsung Electronics made it clear that it is not LCD TV by literally using the term ‘OLED TV’ for the TVs manufactured using OLED panel. But for LED TV, it should be named as LCD TV adopting LED BLU. The LED TV is the one that controls light only with LED.

The name LED TV was a dangerous concept allowing for that it is safe to deceive general customers to sell products. This concern reoccurs for the LCD TV employing the quantum dot technology. As the LCD TV adopting the quantum dot technology emerges as a new rising star of the TV market, the TV set producers are planning to ship the products under the names of QD TV, QLED TV, or Q Dot TV. While they are naming the LCD product as if it is a new TV made only with the quantum dot while in reality, the quantum dot technology is added to the LED backlight to improve the color reproducibility and power consumption.

The worst name is “QLED TV” which was created just by putting a dot in the OLED TV. It is assumed to be the combination of the terms LED TV and quantum dot. But it is very similar to the name ‘OLED TV’ that commonly recognized as the next generation TV to the extent of confusing as OLED TV.

In the TV market that becomes more and more competitive as time passes, the differentiation strategy is crucial to make a distinction with other companies. However, this immoral and disgraceful trick of playing with consumers with naming must be stopped. Like an automobile company gets a considerable penalty for selling a car with false mileage, the strict sanctions must be imposed upon TV manufacturers using names to deceive customers.

Solution-processed OLED to be commercialized in years

November 28, 2014/in Market /by OLEDNET

A solution-processable OLED technology is the one of its kinds that can RGB panels by using mother glasses for Gen 6 or later OLED panels. After some improvements are made to the properties of materials and definition, solution-processed OLED products will be manufactures in years to come.

So far, the existing solution process technology with a resolution of 200ppi could not be applied to smartphones and tablet PCs requiring a higher definition. With the development of the new technology that can feature a resolution of up to 300ppi, however, the solution process can become applied to tablet PCs with the potential for rapid growth.

In addition, it is possible that solution process technology is utilized to manufacture ultra HD 4K and even 8K (7680×4320) TV panels. The 65-inch 8K (7680×4320) panels are expected to feature a resolution of approximately 140 ppi. The manufacturing of panels that can produce an image of 200 ppi or higher will lead to the production of high-definition RGB LED TV panels.

Given that the 10.5-inch panels using the recently released AMOLED panels have a resolution of 287 ppi and use a Pentile layout, tablet PC panels with a RGB layout will be manufactured by using the solution process technology.

UDC, OLED market awaiting to bloom

November 14, 2014/in Market /by OLEDNET

On the 6^th, Universal Display Corporation (UDC), the U.S panel company, announced on their website that the 3Q/2014 Performance Summary was released on 30^th October.

The sales for the third quarter of 2014 is $32.9 million similar to $32.8 million which was the 3Q sales in the previous year. It is analyzed that the rise by a small margin is because the royalties and license fees were increased from $1.5 million in the third quarter of the last year to $5.4 million. In addition, another result includes the decrease of materials sales by 9% from $30.3 million to $27.5 million. It is considered that it fell due to the poor host materials sales. The business profit is $6.1 million, increased $1.9 million from the same period a year earlier.

The sales by the third quarter of 2014 is $134.9 million, increased by 39% as compared to the corresponding period last year. Though there is little demand for materials as the OLED industry is still in the preliminary stage, the UDC indicated on the report that there are variables to come. For that reason, the sales for this year is expected to be between $183 million and $185 million.

reporter@olednet.co.kr

Korean Display Companies, need urgent restructuring!

October 15, 2014/in Market /by OLEDNET

As the sales of Korean display companies drop drastically, the business profits are under the serious situations.

In 2012 when Samsung Display was established, the sales was about 33 trillion won and 29.8 trillion won in 2013, reduced by 10%. And it is expected to be about 24 trillion won, decreased about 20% compared to the previous year. LG Display is undergoing the similar situation where the sales was 29.4 trillion won in 2012 and 27 trillion won in 2013, losing the amount of 2.4 trillion won. The prospected sales for 2014 is about 25~26 trillion won.

Samsung Display’s business profits recorded 3.2 trillion won in 2012 and 3 trillion won in 2013, but the profit of 2014 is not anticipated as it is only 140 billion won in the second quarter of the year. Meanwhile, the business profits of LG Display were 0.9 trillion won in 2012 and 1.2 trillion won in 2013, expecting 1.4 trillion won in 2014.

While the sales and business profits of Samsung Display are slumping, the LG Display is improving its business value as the business profit increases slightly despite the sales decrease.

But these companies are facing inevitable sales decrease due to the intense investments and panel cost reductions of Chinese display companies, and increase of the production costs, worsening sales conditions of Korean display companies. Moreover, it is even harder to secure competitiveness as the technology level of Chinese panel companies are getting closer to that of Korean companies.

The problem is the decrease in the business profit. In reality, Samsung Display maintains the 33,000 employees since 2012. Given that the sales has decreased by 30% from 33 trillion won to 24 trillion won, keeping the same number of employees implies chronic structure of restricting the improvement of business profit. In purely arithmetical terms, Samsung Display requires structural adjustment of about 10,000 employees. The situation is unfavorable with LG Display as well. LG Display has about 55,000 employees which is 20,000 more than Samsung Display. LG Display’s business profit for this year might be greater than that of Samsung Display but it is relatively in bad circumstances considering sales per individual.

There still is no element likely to appear in 2015 to enhance the sales and business profits more than 2014. The sales fall is expected as the price is continually decreasing without any additional investment, and there is a high probability of business profit drop. However, there is a chance to increase the sales and business profits if these companies secure a market for the expensive OLED panel.

For display companies, the only way to achieve business profits without restructuring is lowering the supply prices of the parts, materials, and equipment. The OLED material industry which is blossoming now is struck by the mortal blow of 50% decrease of OLED emitting materials and relevant materials compared to 2012. The price decrease range of materials is excessively severe compared to the price decrease of the panel. Some companies are reconsidering the business and the poor performances of those display companies are shaking the forward and backward linkages of the industries higher than the actual numerical value.

To save the entire Korean display industries, Samsung Display and LG Display must secure the sound financial structure through structural adjustments rather than requesting of cost reduction for the supplier unilaterally.

The collapses of Japanese companies resulted from retaining the employments in spite of sales aggravation must be taken as a lesson.

reporter@olednet.co.kr

What is the optimal encapsulation technology for the Flexible AMOLED?

September 26, 2014/in Market, Technology /by OLEDNET

Currently mass-producing flexible AMOLED panels are taking PI substrate, backplane, and RGB deposition method, and the existing encapsulation technologies for A2 line of Samsung Display is TFE (thin film encapsulation) and hybrid encapsulation for LG Display.

But for the flexible AMOLED exclusive A3 line which is newly invested by the Samsung Display, advanced the orders not in the TFE but in the hybrid encapsulation method which is laminating the film after resin coating process on the passivation structure of inorganic layer and organic layer, similar to the method that the LG Display takes.

The reason for the change of encapsulation technology at the A3 of Samsung Display was analyzed in the “2014 Flexible OLED Report” issued by the UBI Research including the latest trends and issues such as the flexible AMOLED related issues and processes, market forecast of the flexible AMOLED panel and flexible OLED lighting, flexible AMOLED technologies comparison of Samsung Display and LG Display, etc.

According to this report, the flexible AMOLED panel market is forecasted to show a compound annual growth rate of about 60% through to 2020, reaching $ 17,600 million where the primary applications are expected to be for the flexible AMOLED panel of tablet pc.

<Flexible AMOLED panel Market Forecast>

reporter@olednet.co.kr

AMOLED manufacturing equipment market, expected to be about 36 trillion won from 2015 to 2020

August 12, 2014/in Market /by OLEDNET

According to an equipment report, “2014 AMOLED manufacturing Equipment Technology Analysis and Market Forecast (2015~2020),” published by a market research firm, UBI Research, the AMOLED manufacturing equipment market size will be about 36 trillion won from 2015 to 2020. Stepper appears to be the largest sector in the equipment market by forming about 10 trillion won and taking up about 30 % of market share. Evaporator will take 17% with about 6 trillion.

It is forecasted that Chinese makers will start to invest in AMOLED business. Predicted market size is about 6 trillion won in 2015. In 2017, full-scale investment on the AMOLED panel line for TV will be started. About 9.5 trillion won market will be formed and become the largest market size by 2018.

From 2015 to 2020, the market share of backplane manufacturing, encapsulation and OLED manufacturing equipment will be 69%, 17% and 14%, respectively, in the overall AMOLED equipment market.

In the overall AMOLED equipment market by country, Korean market size is expected to grow to about 20 trillion won taking up 55% market share for six years and it is analyzed that Korea will continuously lead the AMOLED industry.

<2015~2020, AMOLED manufacturing equipment market>

reporter@olednet.co.kr