Road to P-OLED Commercialization Looking Up With Sumitomo's Acquisition of CDT
CAMBRIDGE, U.K. – Analysts believe that the race to commercialize polymer organic-light-emitting-diode (P-OLED) display technology got a significant boost on July 31 when Cambridge Display Technology (CDT) announced it had been acquired for $285 mil-lion by partner company Sumitomo Chemical.
"Sumitomo must have seen the future potential of CDT," said iSuppli Senior Analyst of Technology and Strategy Jennifer Colegrove. "CDT was the largest polymer OLED licenser and provider. Especially in the last 12 months, CDT has also demonstrated a new technology—Total Matrix Addressing, or TMA—which will potentially open up a new revenue stream as well as enhance the attractiveness of the technology for production of passive-matrix displays."
ISuppli is forecasting a large growth potential over the next few years for active-matrix (AM) OLEDs, which CDT's technology can enable. And though it lags behind small-molecule and phosphorescent OLEDs in terms of luminous efficiency and lifetime, P-OLED does have some key advantages over competing technologies. For example, P-OLEDs create devices with lower-operating voltages, and can be ink-jet printed or spin-coated, saving manufacturers equipment and money. Sumitomo has been clear in stating its intent to use CDT's technology to push forward in the display market, CDT CEO David Fyfe said.
Fyfe expects the road to commercialization of P-OLED displays to be considerably smoother with Sumitomo, a large, well-connected, successful company, at the helm. Securing operational and development capital was often a struggle for CDT, he added, but this acquisition infuses the company with cash to allow it to focus exclusively on developing the P-OLED technology. And Sumitomo's broad relationships in the display and electronics markets can only help speed the development.
"I think what we'll see is much more strate-gic partnerships developed between Sumitomo and these larger organizations," Fyfe said. "I think what we'll see is an additional amount of effort coming from the Sumitomo end. I think we'll see them taking the developments that CDT has been doing forward into at least a development-manufacturing facility, if not manufacturing itself."
"CDT will certainly benefit by having a larger, mature technology business to own it. I think, as a business, it will probably have a much smoother ride to commercialization," agreed Craig Cruickshank, CEO of consulting firm Cintelliq, which specializes in the organic-electronics market. "It will be interesting to see how future licenses are sold, how they will conduct the future business model, and how people will get access to that technology."
The amount Sumitomo paid to acquire its partner company may also be a good indication of its belief in CDT's future profitability. As of July 30, CDT's closing share price was only $6.15; however, the price at which Sumitomo acquired the company represents nearly double that at $12 per share. According to Colegrove, CDT's stock has not gone as high $12 per share since about 2005. In 2005, CDT's revenue was about $16 million, versus about $13 million in 2006.
"Sumitomo must have a very good long-term strategy," commented Cruickshank. "Surely Sumitomo wouldn't agree to spend that amount of money if they didn't believe that they would get a return on their investments."
Sumitomo was well aware of what it was spending its money on, having worked with CDT since 2001. In 2005, the two companies formed Sumation, a joint venture to develop, manufacture, and sell P-OLED materials to CDT licensees and other companies. So, Colegrove pointed out, Sumitomo likely anticipated a low risk in acquiring its partner company. In fact, Fyfe said, the idea of the acquisition came up when the two companies were discussing future strategy for making the intellectual property secure and pushing the technology forward.
According to Fyfe, Sumitomo's working relationship with CDT over the years has been solid, and it is important to CDT that the two companies know and trust each other.
"The issue is always David working with Goliath, and Goliath may not be sure that David is going to deliver his end of the deal with the technology," Fyfe said. "But there can be no doubt, with Sumitomo having paid for CDT and with CDT knowing Sumitomo, that they will have the credibility."
— Jessica Quandt
CMEL Becomes First Major Taiwanese Display Company to Commercially Produce AMOLED Panels
TAIPEI, Taiwan — Chi Mei EL (CMEL), a subsidiary of Chi Mei Optoelectronics (CMO), began volume production of 2.4-in. active-matrix organic-light-emitting-diode (AMOLED) panels in August, according to various media reports. CMEL also planned to start sample production of 4.3-in. AMOLED panels in September and 8.1-inch panels in the second half of 2008.
This launch is noteworthy because it marks the first time that one of the major Taiwanese display manufacturers has decided to commercially produce AMOLED panels. In fact, at the Display Taiwan trade show in June, CMEL was one of only two companies—RIT Display was the other—showing OLED products (out of approximately 150 exhibitors).
This seems to be a conscious decision by the large Taiwanese TFT-LCD panel makers, who claim that it is not cost-effective for them to be the leaders in OLED research. This is in stark contrast to Korean panel giants Samsung and LG.Philips LCD, both of which showed exciting OLED and flexible-display prototypes at Display Week 2007 in May, and already offer OLED products for mobile devices.
According to Jia-Xing Lin, deputy project manager at Taiwan's Industrial Technology Research Institute Display Technology Center (ITRI), Taiwan's major panel makers have been so intent on trying to gain market share in the TFT-LCD business that they have thrown all of their resources into building up that business. So far, this strategy has worked, as Taiwan currently owns approximately one-third of the world's TFT-LCD market. ITRI is doing work on flexible displays, but did not show any products or prototypes in its booth at Display Taiwan.
Taiwanese panel makers cite costs as another reason why they have backed off on OLED and flexible-display research.
"So far, the materials R&D has been very limited (for OLED), and no breakthroughs in terms of manufacturing. The problem is how to reliably manufacture OLEDs, and that has not been figured out," explained Kuang-Lang Wolf Chen, Vice President, Research and Development Center, for ChungHwa Picture Tubes Ltd. (CPT) on why his company has backed off on OLED work. He added that CPT only have a very small OLED R&D operation and no product-development plans. "Only the very first mover in the marketplace will have an advantage; after that, everyone will be in the same boat."
Chen added that once OLEDs are commercialized, he expects CPT will be able to ramp up production quickly without falling too far behind.
AU Optronics (AUO) has taken a similar approach, scaling back its OLED efforts tremendously of late. The reasons, according toDavid Su, senior vice president and general manager of AUO's Television Display Business Group, the company found OLED research too expensive, especially considering that mass production for large OLEDs has yet to be established.
Only CMO seems to be actively engaging the OLED market. The company showcased its line of OLED products for mobile phones at Display Taiwan, as well as its 25-inch AMOLED panel, which it plans to commercialize in 2008. The 1.5-mm-thick panel, which won a 2007 Gold Panel Best Technology Award at the show, features 1360 x 765 resolution, 16.7 million colors, 550 nits brightness, and a response time of 10 ms.
RIT showed some passive OLED devices, as well an AMOLED touch panel that was just 2.01 mm thick thanks to capacitance touch sensors built directly into the glass. Company officials said they believe it is the only OLED touch screen in the world.
The only other Taiwanese company known to be developing OLED and/or flexible displays is TPO, the firm that was spun off from the joint venture between Toppoly and Philips; however, TPO did not exhibit at Display Taiwan 2007.
"[Taiwan is] thinking of getting into the market (for flexible displays), but we need to find the proper applications, and to avoid competition with existing LCDs," said Lin of ITRI during his presentation at the Display Taiwan 2007 Business and Technology Forum. "This is a critical moment, and we need to try to expand investment and R&D in this area."
— Michael Morgenthal
OSRAM to Leave OLED Display Market to Focus on OLED Lighting
MUNICH, Germany - Citing a lack of demand for passive-matrix organic-light-emitting-diode (PM-OLED) displays, OSRAM Opto Semiconductors has announced that, by year's end, it will shift its OLED research and manufacturing activities away from displays to focus exclusively on the research and manufacturing of OLEDs for market-ready solid-state lighting solutions.
OSRAM has been running an OLED display production facility in Penang, Malaysia since the end of 2003, producing monochrome OLEDs in different colors and sizes under the brand name of Pictiva. These displays have been used in applications in the communications sector, in industrial applications, and in mobile consumer electronics, according to company Press Officer Marion Reichl. However, worldwide demand for such displays has fallen short of the company's projections.
"With OLEDs, we have always seen their use as a light source to be the principal application of this technology. We now want to concentrate more on such applications and are therefore consolidating our activities in the segment of OLED passive-matrix displays," Reichl said. "Developments in this price-sensitive market with harsh competition from LCDs (liquid-crystal displays) have lagged far behind our expectations. We see immense market potential in OLED lighting solutions, however. They open up entirely new applications and will lead to new and unique types of light sources. Our objective is to develop the necessary technologies to open up these markets—and of course, take on a leading role on the international stage."
OSRAM's opting out of the PM-OLED display market is not a sign that these displays are losing steam, according to Craig Cruickshank, CEO of Cintelliq, a consulting firm specializing in the organic semiconductor industry. Rather, it could mean that polymer-based PM OLEDs, or P-OLEDs—developed by Cambridge Display Technologies (CDT), from which OSRAM licensed the technology—aren't currently the preferred technology for manufacturing displays.
"There are two flavors of passive-matrix displays—small-molecule and polymer—and 96% or more is small-molecule," Cruickshank explained. "OSRAM's got a polymer-based device. The market for passive-matrix displays is still going on: people still use them in phones and MP3 players and such. But that's generally a Kodak-type (small-molecule) technology. Passive-matrix displays are still going on, but OSRAM only represents a tiny share of that market."
According to industry research group DisplaySearch, OSRAM's actual share is less than 2% of the PM OLED display market.
"My understanding is that OSRAM is a lighting company and has made a decision that they want to focus all of their efforts on just lighting," Cruickshank added. "They'll use that knowledge and know-how for good use, but they won't make displays."
Now that OSRAM will focus solely on solid-state lighting, the company expects to make strides in lifetime, brightness and efficiency in order to better compete, according to Reichl, though OSRAM has not decided yet whether to continue using P-OLEDs or switch to small-molecule. Another challenge will be finding processes that will enable large-area OLED light sources to be manufactured in reliable quality and uniformity.
"The greatest challenge will be to develop mass production methods to ensure cost-effective manufacture. OLEDs will only ever become a widespread light source if the price is right," Reichl said. But, thanks in part to recent OLED research investments from the German government, she said, the challenges should be surmountable. "With the OLED initiative of the German government, we are looking to make real progress in all these aspects."
Sharp Introduces 52-in. LCD-TV Prototype that Measures 29-mm Thick
For the past several years, the race among the largest thin-film-transistor liquid-crystal-display (TFT-LCD) panel makers has been to see who can build the largest display—Sharp introduced a 109-in. panel in 2007. Now, with organic-light-emitting-diode (OLED) TVs' imminent commercial introduction in 2008, it seems that the TFT-LCD's newest race may be shifting to who can develop the thinnest TV.
Sharp seems to have taken the lead in this area as well, with its August announcement of a 52-in. LCD-TV prototype that measures only 29 mm thick—about one-third the thickness of current LCD TVs—and weighs 25 kg. The display, which various media reports stated would be mass-produced in 2010 from Sharp's Gen 10 fab, also features a contrast ratio of 100,000:1, power consumption of 140 kWh/year, and 150% NTSC color gamut.
The introduction of this prototype appears to be an answer to the planned introduction of OLED TVs by SONY and Toshiba. At SID'sDisplay Week 2007 in May, both Toshiba-Matsushita Display (TMD) and Sony showcased their latest OLED TV prototypes, and announced plans for their commercialization by late 2007. While the thickness of TMD's 20.8-in. OLED TV was not made available, Sony's 27.3-in. TV came in at just 10 mm thick. Sharp representatives did not respond to requests for comment by press time, so it is unclear whether competing with OLED is a consideration in the company's mission to produce thinner TVs.
Display Briefs
The Video Electronics Standards Association (VESA) announced on Aug. 13 that it had completed its second DisplayPort Plug Test as scheduled July 30–31 at the Embassy Suites Hotel in Milpitas, California. Twenty-five computer, flat-panel, component, and test-equipment manufacturers, including Advanced Micro Devices (AMD), Agilent, DCP LLC, Dell, Intel, LG.Philips LCD,NVIDIA, Samsung Electronics, and Tektronix, led the successful two days of testing of cables, transmitters, receivers, monitors and graphic cards that implement the DisplayPort version 1.1 standard. In addition to the PlugTest, VESA held a comprehensive workshop covering a full range of topics on the DisplayPort standard, with presentations ranging from an update on Version 1.1 of the specification to interoperability guidelines for enabling interoperability between DisplayPort devices and DVI1.1/HDMI devices through the use of adaptors, to compliance test procedures.
Sharp Corp. announced on August 6 it had filed a lawsuit alleging infringements of five of its patents on LCD-related technology bySamsung Electronics Co. Ltd. and its U.S. subsidiaries Samsung Electronics America Inc. (SEA) and Samsung Telecommunications America (STA). The suit was filed in the United States District Court for the Eastern District of Texas. According to Sharp, the complaint alleges that the following products infringe LCD-related patents that are owned by Sharp: liquid-crystal-display (LCD) modules manufactured by Samsung and sold in the U.S. by Samsung; LCD TVs and LCD monitors that incorporate the LCD modules manufactured by Samsung and are sold in the U.S. by SEA; and mobile phones which incorporate the LCD modules manufactured by Samsung and are sold in the U.S. by STA. In the complaint, Sharp said it requests that the Court award compensatory damages to Sharp and prohibit the sales of the infringing products.
Rohm and Haas Company and SKC Inc. have formed a new joint venture that will develop, manufacture and market advanced optical and functional films used in the flat-panel-display industry, the two companies announced on Aug. 14. The joint venture will aim to provide a broad portfolio of unique films used in today's most advanced liquid-crystal (LCD) and plasma displays. As part of the new joint venture arrangement, SKC will spin off its Display Technologies business into a separate legal entity, according to a company statement. Rohm and Haas will invest to become a 51% owner in the new company.
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