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Technology Stocks : AFCO: Applied Film, Undiscovered Gem? -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (194)	8/20/2002 6:49:44 PM
From: SemiBull	Read Replies (1) \| Respond to of 238

Motherglass standard eludes FPD makers By Jack Robertson, EBN URL: ebnews.com The first Generation 5 LCD fabs are coming on the scene, and though the facilities will be the first to use motherglass that is larger than 1m square, vendors already are planning fabs with glass substrates up to 1.5m x 1.8m. Once again, flat panel producers also are sparring over the need for a standard glass size for the so-called Gen-6 fabs. In every previous fab generation, the industry debated the need for standards to cut the soaring costs of the custom equipment required to handle the disparate glass sizes. In every case, obstinate vendors who wanted their own peculiar motherglass dimensions, failed to agree to a common format. It's iffy whether LCD panel makers will agree to Gen-6 glass standards. Producers are planning glass sizes to achieve the optimum number of panels for the particular LCD market they are targeting, whether large-size TV screens of 30 inches and above, or for large-screen flat panel monitors. OEM customers generally don't care much about the perennial LCD cat fight over motherglass standards. Each new-generation fab yields more panels whatever the substrate size, cutting the production cost over previous generations. That should work out to lower prices, but supply and demand dictate the going market price at any given time, regardless of the glass size. Just as in the case with Gen-5 fabs, flat panel firms are hustling to build Gen-6 plants to avoid being left behind. No major vendor can risk letting competitors score a beat by coming on line with higher-yielding fabs. It appears that Sharp Corp. of Japan may be first out of the next-generation chute. Sony will break ground next month on an LCD fab in Kameyama, Japan that will use 1.5m X 1.8m motherglass. Initial production is slated for May, 2004. Joel Pollack, vice president of the display business unit for Sharp Microelectronics of the Americas, said the fab will have a capacity of 100,000 panels per month. Sharp is calling its new fab a Gen-7 facility, touching off a semantic squabble among rival vendors. Samsung Electronics, which has its own next-generation LCD fab on the drawing boards, hasn't settled on its motherglass size yet, but would include 1.5m X 1.8m substrates among the candidates for what it calls a Gen-6 fab. Bruce Berkoff, senior vice president of LG.Philips LCD, said LCD technology and time-to-market are more critical factors for new glass sizes than arguing over what label is hung on a new fab. Berkoff said Gen-6 should logically cover all sizes between 1.5m and 2m glass. Both Samsung and LG.Philips are aiming for initial Gen-6 fab production in the 2004 time period. Most of the large panels coming from Gen-6 fabs are expected to be sold into the TV display market. Ross Young, an analyst with DisplaySearch Inc., Austin, Texas, estimated that 3 million to 4 million flat panel screens larger than 20 inches will ship next year for TV screens. That should shoot up to 14 million panels by 2006, accounting for half of all LCD panels shipped. The Gen-6 wild card is what Taiwan's flat panel producers will do. Some Taiwanese LCD vendors that rushed to build Gen-5 fabs are experiencing financial growing pains, as they ramp up output and begin to saturate the market. It's uncertain how many of Taiwan's LCD makers will want to quickly jump into the looming Gen-6 fab fray. But Sharp, Samsung, and LG.Philips are definitely off the races. Bigger is definitely better in this sweepstakes.