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To: SemiBull who wrote (215)	5/28/2003 6:55:25 PM
From: SemiBull	Read Replies (1) \| Respond to of 238

SID 2003: Display manufacturers look to future markets By Paul Semenza ebnonline 05/28/2003 11:00 AM EST URL: ebnews.com The emphasis at the Society for Information Display International Symposium, Seminar and Exhibition (SID 2003) held last week in Baltimore was on television, with suppliers of LCDs and alternative technologies mapping out the landscape of the flat-panel TV market of the future. At the event, there was relatively little activity in the areas that represent the main sources of revenue for the display industry -- desktop PC monitors and notebook computers. Instead, exhibitors showed an abundance of large LCDs and plasma display panels (PDPs) for high-end televisions, an area that now accounts for a very small share of overall flat-panel display revenues but that is expected to undergo rapid growth over the next few years. LCD-TV unit sales are expected to increase by more than a factor of 20 from 2002 to 2007, iSuppli/Stanford Resources predicts. For LCD makers, the TV market represents the growth engine that will justify the construction of new fabs, and will perhaps help them realize their goal of achieving consistent profitability. Based on the comments of LCD makers at the event, profitability appears to have replaced market share as the primary driver of LCD suppliers' strategies. Despite difficult economic conditions and sometimes elusive profitability, the electronic display industry is experiencing rapid revenue growth. This is largely because higher-value LCDs are replacing CRTs in desktop monitors, notebook computers are using larger screens, and mobile products are adopting larger displays with higher performance. However, demand from these applications largely will be satisfied by existing LCD manufacturing fabs. Because of this, display manufacturers feel compelled to generate interest in new markets in order to justify new investment. At SID, every major active-matrix LCD (AMLCD) producer is showing large LCD TVs, ranging in diagonal size from 30 inches to more than 50 inches. Most such panels cannot be made efficiently at existing fabs, so high-volume shipments will have to wait until several new-generation fabs come on line during the next few years. Because of the tremendous costs involved in building cutting-edge fabs -- in excess of $1 billion -- LCD producers are wasting no time in building up interest in flat-panel TVs. However, the exhibits at SID also illustrate that there will be a great deal of competition for LCDs in the flat-panel TV market, specifically in the area of PDPs. PDPs being shown at SID are excellent in every respect, with general agreement that plasma image quality is now equivalent in most respects to CRT, the present benchmark for TV sets. The competition between PDP and LCD will be most intense in screen sizes between 30 and 40 inches. In larger screen sizes, projection technologies -- particularly rear-projection systems using Texas Instruments Inc.'s Digital Light Processing (DLP) system -- demonstrated markedly improved quality and slimmer case sizes. Meanwhile, PDPs are pushing to larger sizes, with indications that Samsung SDI Co. has produced a 70in. plasma panel. In small-sized displays for mobile applications, there was a similar profusion of technology choices shown at SID. In mobile applications, passive-matrix LCDs have been under assault from several types of AMLCDs, as well as from organic light-emitting diode (OLED) displays. Low-temperature polysilicon (LTPS) LCDs have made headway by providing high levels of integration on the display, including imaging elements built into the display, which enable the most compact display size. However, as in nearly every other key application, the amorphous-silicon LCD juggernaut now has turned its attention to mobile applications. There are many amorphous-silicon LCD products available, using a variety of backlighting approaches. Meanwhile, passive-matrix LCDs have continued to improve their performance, while maintaining the lowest cost. Finally, OLED technology is in full bloom, with volume production of primary and secondary displays for mobile handsets, as well as for automotive applications and a small number of consumer electronics devices. Eastman Kodak Co. at SID 2003 demonstrated the largest active-matrix OLED (AMOLED) now in production, which is used in a Kodak digital still camera. Samples of AMOLEDs larger than 10 inches also were on display at SID. OLED technology is positioning itself as a potential competitor to LCDs across a wide range of screen sizes and applications. At the same time, suppliers are acknowledging that OLEDs presently do not enable any new applications so they will have to offer a real improvement in cost and performance in order to be successful. Despite the innovative approaches represented by PDPs, OLEDs, and several other emerging technologies, the large AMLCD manufacturers are not terribly concerned about the prospect of losing out to these rivals. Rather, the AMLCD manufacturers are focused completely on competing with other active-matrix producers, which make similar panels for the same set of customers and applications. Most of these manufacturers, despite collectively producing revenues of $30 billion this year, are not consistently profitable. Yet they are able to proceed and invest large sums of money in new production capacity. The competition among LCD manufacturers and between LCDs and competing technologies surely will provide great benefit to consumers of displays large and small. However, ideas for improving profitability in display manufacturing are much harder to find than good-looking displays. Paul Semenza is executive vice president of iSuppli/Stanford Resources. Contact him at p.semenza@stanfordresources.com.