by Hash Pakbaz
The growth of the flat-panel-display market is primarily due to the rapid penetration of plasma-display-panels (PDPs) and liquid-crystal displays (LCDs) into the television market, replacing cathode-ray-tube (CRT) displays. According to the market-research firm DisplaySearch, the fastest growing segment, LCD TV, showed a 69% year-over-year growth in 2006 and is expected to continue to grow at a rapid pace. The historical and forecasted growth rates are in part fueled by a large drop in LCD-TV prices (almost 30% in 2006 vs. 2005).
According to Cheil Industries, approximately 75% of the cost of an LCD module consists of "materials" cost as compared to 25% process cost. In Cheil's analysis, materials are defined as direct materials used by panel makers, including the backlight unit, IC drivers, etc. Display fab materials constitute roughly $20 billion of this total global materials sales. Therefore, fab materials targeted toward LCD-TV manufacturing represent a very attractive market for electronic-materials suppliers. Due to the dominance of the materials cost in the total cost of goods sold (COGs), however, material-price reduction represents the most effective path toward achieving the enormous downward price pressure required to fuel the LCD-TV demand. Therefore, new entrants into the display-materials business must focus on materials and materials-processing innovations that lead to significant manufacturing cost reduction without sacrificing performance.
One key trend in cost reduction has been the adoption of solution-processable materials and processes to replace vacuum deposition. In addition to reduced capital costs and running costs, the potential to replace subtractive processes with additive processes presents an undisputable cost-reduction roadmap. Adoption of ink-jet-printing platforms for the manufacture of color filters represents a clear example. An examination of the active-matrix LCD cell (between the two glass substrates) readily demonstrates that, currently, almost half of the thin-film layers are deposited using wet-process methods. Indeed, besides the thin-film-transistor (TFT) related layers, the transparent conductor (TC) is the only other material deposited using vacuum techniques. Substitution of indium tin oxide (ITO) by solution-processable equivalents has, therefore, attracted much attention in the past few years.
Cambrios Technologies is among several companies currently engaged in the development of such a material. The Cambrios approach is significantly different from its competitors as reflected in the optical/electrical performance of its materials. Cambrios, using its unique technology based on a specially designed metallic nano-structure dispersion, has already demonstrated TC films with transmission and conductivity characteristics that are competitive with ITO. Furthermore, Cambrios' material can be deposited using standard wet-process techniques such as slit coating or spin coating. Transmission and conductivity, however, are only a small part of the long list of specifications that must be met before adoption. Cambrios hopes to address key issues such as process integration, reliability, etc., through close collaborative efforts with panel makers.
In addition to meeting technical specifications with the promise of significant manufacturing cost reduction, new entrants – especially small-sized and venture-backed companies – must address another important issue to achieve commercial success. Close examination of the suppliers of materials and process equipment for each of the thin-film layers, substrates, and optical films in an AMLCD cell reveals an interesting trend: There is one significant and dominant supplier for each layer (including the glass substrate). Game-changing innovations, rather than incremental improvements, are typically provided most successfully by small and venture-backed entities and not necess-arily by the current dominant players in the supply chain. Therefore, commercial success of venture-backed companies in this market depends strongly on a business model to address the existing supply chain while meeting the expectations of their investors for a liquidity event. The panel makers' active involvement and support can be a significant factor in shifting the supply-chain dynamics, so as to provide faster access to new technologies and help create legitimate competitors.
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