LCD Market: Technology Directions and Market Analysis

SUMMARY

LCD MARKET: TECHNOLOGY, DIRECTIONS, AND MARKET ANALYSIS

The global TFT-LCD panel industry consists of a small number of manufacturers, substantially all of which are based in Asia. The top ten TFT-LCD panel manufacturers of large-sized panels in terms of unit sales accounted for 95.7% of global sales in the first three quarters of 2005. All of these manufacturers are based in Asia. In recent years, TFT-LCD panel manufacturers, in particular Taiwan- and Korea-based manufacturers, have invested heavily to establish, construct and ramp up additional fab capacity. The capital intensive nature of the industry often results in TFT-LCD panel manufacturers operating at a high level of capacity utilization in order to reduce unit costs. This tends to create a temporary oversupply of panels, which reduces the average selling price of panels and puts pricing pressure on display driver companies.

Since the 1990s, a pitched battle for supremacy in thin-film transistor liquid crystal displays (TFT-LCDs) has been fought between Taiwan, Korea, and Japan.

This rivalry is not simply a matter of pride: its outcome will also be a decisive factor in the development of Taiwan's high-tech industry over the next ten years. Though Taiwan was a relative latecomer to the battle, it has progressed quickly. As Japan withdrew from the race for production capacity, a two-way battle between Taiwan and Korea became increasingly evident.

In the late 1980s, as the Japanese bubble economy collapsed, the consequent depressed economic conditions made it difficult for Japanese companies to raise funds and expand production. Just at that point, Taiwanese companies with excellent access to capital made their entry, and Japanese companies began transferring technology to Taiwan through strategic alliances, in the process deciding the fate of Taiwan's TFT-LCD industry. Today, the "five tigers" of Taiwan's flat panel industry-AU Optoelectronics, Chi Mei Optoelectronics, Chunghwa Picture Tubes, Quanta Display, and HannStar Display-all maintain close technological cooperation with their chosen Japanese partners.

From 2002, the rivalry between Taiwan and Korea to best each other in production capacity emerged. Taiwanese vendors expanded production capacity more aggressively, and it is projected that at the end of this year, more than five fifth-generation and three sixth-generation production plants will be located in Taiwan. Though the fact that the newer the design of the factory, the larger the LCD screens that can be produced, can help reduce costs, the real competition is turning out to be in seeing who has the deeper pockets. Since 1999, when the Japanese transferred key technologies to Taiwan, major vendors have continually been making moves to raise capital both domestically and abroad, ensuring an uninterrupted flow of investment over the past few years.

Currently Taiwan's biggest rival is Korea. Korea entered this industry six years before Taiwan. It has greater upstream and downstream integration, and greater self-sufficiency. Korea also benefits from the brands and global channels of market leader Samsung and of Philips LG. These factors make Korea's flat panel industry far more complete than Taiwan's.

Besides South Korea with the breadth of its downstream and upstream integration, and Japan with its cutting-edge technology and strong brands, China has been making moves in recent years. China will likely turn the flat panel industry into a four-way battle.

Mainland China is expected to see the establishment of at least five 5G and four 3.5G TFT-LCD lines by 2008. At present, there are only two 5G TFT-LCD lines in the mainland. The first one is operated by BOE Technology Group Co. Ltd and the second by Shanghai SVA-NEC Liquid Crystal Display Co. Ltd.

While Japanese manufacturers enjoy a sound industry structure, lack of capital for further investment in new plants makes it difficult for Japanese makers to exploit this advantage to the fullest. Faced with competition from Taiwan and South Korean manufacturers, Japanese manufacturers are likely to leverage their existing competitive advantages in technology, patents and branding to deepen their collaborative relationships in mainland China. While they will run the risk of losing technology to others, the capital gained through strengthening their position in brand and distribution will allow Japanese manufacturers to direct the development of next-generation products.

While Taiwan manufacturers have been able to rapidly secure a large market share in the global TFT-LCD panel industry due to their strong position in the system integration sector, as companies move production to mainland China there will be less need to purchase components produced in Taiwan. To counter this looming decrease in market share, Taiwan makers are likely to develop technology and supply capabilities in semiconductor, core materials and basic materials, as well as leverage certain cultural and language advantages to expand branding and distribution in mainland China. Taiwan manufacturers will thereby increase the amount of influence they are able to exert within the industry.

By exploiting warmer relations with mainland China than Taiwan enjoys, South Korean manufacturers can deepen their supply system in mainland China. They will then be able to stave off competition from Taiwan manufacturers.

This technology-marketing report examines and projects the technologies involved in the fabrication of Liquid Crystal Displays (LCD). This report discusses the technology trends, products, applications, and suppliers of materials and equipment. A market forecast for AMLCD equipment and materials is presented.

TABLE OF CONTENTS

Chapter 1. Introduction

Chapter 2. Executive Summary

• 2.1 Introduction
• 2.2 Market Opportunities

Chapter 3. Profiles of Japanese Companies

• 3.1 Equipment Manufacturers
• 3.2 Material Manufacturers
• 3.3 LCD Manufacturers

Chapter 4. Profiles of US Companies

• 4.1 Equipment Manufacturers
• 4.2 Material Manufacturers
• 4.3 LCD Manufacturers

Chapter 5. Profiles of ROW Companies

• 5.1 Equipment Manufacturers
• 5.2 Material Manufacturers
• 5.3 LCD Manufacturers
• 5.4 Mainland China

Chapter 6. The AMLCD Factory

• 6.1 Factory Logistics
  • 6.1.1 Investment Needs
  • 6.1.2 Capacity
  • 6.1.3 Plant Size
• 6.2 Cleanrooms
• 6.3 Automation
• 6.4 Active Matrix LCD Production Trends
  • 6.4.1 TFT-LCD
    • 6.4.1.1 IPS
    • 6.4.1.2 MVA
    • 6.4.1.3 PVA
  • 6.4.2 Passive Matrix LCD
  • 6.4.3 Ferroelectric LCDs
• 6.5 Electrophoretic Display
• 6.6 Plastic LCDs

Chapter 7. Equipment Requirements and Trends

• 7.1 Introduction
• 7.2 Microlithography
  • 7.2.1 Proximity Printing
  • 7.2.2 Scanning Projection
  • 7.2.3 Step-and-Repeat
    • Image Field Stitching
    • Overlay
• 7.3 Deposition
  • 7.3.1 CVD
  • 7.3.2 Sputtering
• 7.4 Rapid Thermal Processing
• 7.5 Etch/Strip/Clean
  • 7.5.1 Etching
    • Plasma Etching
    • Wet Chemical Etching
  • 7.5.2 Photoresist Stripping
  • 7.5.3 Cleaning
• 7.6 Inspection Systems
• 7.7 Test Systems
  • 7.7.1 Technology Capabilities
    • Voltage/Capacitance Imaging
    • Ohmic/Continuity Test
    • Charge Sensing
    • Forward Admittance Sensing
    • E-Beam Test
  • 7.7.2 Yield Improvements
• 7.8 Repair

Chapter 8. Material Requirements and Trends

• 8.1 Substrates
  • 8.1.1 Material Types
  • 8.1.2 Quality Issues
  • 8.1.3 Trends
    • Larger Substrates
    • Thinner Substrates
    • Better Surface
    • Higher Temperature Capability
    • Manufacturers
• 8.2 Liquid Crystals
  • 8.2.1 Introduction
  • 8.2.4 OLEDs and Light-Emitting Polymers
• 8.3 Alignment Layer
  • 8.3.1 Material Properties
  • 8.3.2 Material Trends
• 8.4 Color Filters
  • 8.4.1 Materials
• 8.5 Polarizer Films
  • 8.5.1 Material Properties and Trends

Chapter 9. Market Forecast

• 9.1 Getting To Market
• 9.2 Market Forecast Assumptions
• 9.3 LCD Market Forecast
• 9.4 Equipment Market Forecast and Trends
  • 9.4.1 Lithography
  • 9.4.2 Plasma Etching and Stripping
  • 9.4.3 Thin Film Deposition
  • 9.4.4 Wet Etching and Cleaning
  • 9.4.5 Photoresist Processing
  • 9.4.6 Inspection/Repair
  • 9.4.7 Total Equipment Market
• 9.5 Materials Market Forecast

LIST OF FIGURES

• 6.1 FPD Stocker and Lifter
• 6.2 Amorphous Silicon AM Fabrication Process
• 6.3 AMLCD Cross Section
• 6.4 Electrophoretic Display Cross Section
• 6.5 Schematic of a 2-Layer OLED
• 7.1 Schematic of Step-and-Repeat Aligner
• 7.2 Schematic of Hot-Wall LPCVD Reactors
• 7.3 Schematic of PECVD Techniques
• 7.4 Diagram of Magnetron Sputtering Source
• 7.5 Diagram of Rapid Thermal Processor
• 7.6 Process Flow for Cell/Module Inspection
• 8.1 Light-Emitting Polymer Structure
• 8.2 LEP Structure Cross Section
• 8.3 Ink-Jet Printing Of LEP Structure
• 8.4 Compraison of Color Filter Methods
• 9.1 Worldwide Large Panel Display Market Forecast
• 9.2 Worldwide LCD PC Monitor Market Forecast
• 9.3 Worldwide Large-Size TFT Forecast By Region
• 9.4 North American LCD TV Market Forecast
• 9.5 North American Plasma TV Market Forecast
• 9.6 Production Lines In Operation By Generation
• 9.7 Nikon's Stepper/Scanner Tools
• 9.8 Worldwide TFT-LCD Equipment Market Growth
• 9.9 Worldwide Large Area LCD Glass Consumption By Generation
• 9.10 Worldwide Large Area LCD Glass Consumption By Region

LIST OF TABLES

• 6.1 Investment for Large-size TFT-LCD Panel Plants
• 6.2 Causes of Defects in TFT LCD Manufacturing
• 7.1 Common Wafer Processing Chemicals
• 7.2 Advantages and Disadvantages of Various Cleaning Methods
• 8.1 3G Manufacturing Facilities
• 8.2 3.5G Manufacturing Facilities
• 8.3 4G Manufacturing Facilities
• 8.4 5G And Above Manufacturing Facilities
• 8.5 Desired Nematic LC Material Characteristics
• 8.6 Performance Of LEPs
• 8.7 Characteristics of Aligning Materials
• 9.1 Worldwide LCD Display Market Forecast
• 9.2 Major LCD Panel Makers Market Share 2006-2007
• 9.3 Major LCD Panel Makers Capacity - 2007
• 9.4 Worldwide TFT-LCD Stepper/Scanner Market Forecast
• 9.5 Worldwide Market Forecast of TFT-LCD Plasma Etching Systems
• 9.6 Forecast of Worldwide TFT-LCD Thin Film Deposition Equipment Market
• 9.7 Forecast of Worldwide TFT-LCD Wet Etching and Cleaning Equipment Market
• 9.8 Forecast of Worldwide TFT-LCD Photoresist Processing Equipment Market
• 9.9 Forecast of Worldwide TFT-LCD Inspection/Repair Equipment Market
• 9.1 Forecast of Worldwide TFT-LCD Equipment Market
• 9.11 Worldwide Equipment Market Shares