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Mobile screen demand to drive competitive panel display market

Editorial
article image The highly competitive state of the market means smaller-sized panel makers will see their margins squeezed.

PANEL display makers will increase their production from 2015 to 2016, by adding low-temperature polysilicon production lines.

According to WitsView, a research division of TrendForce, total production capacity by area will more than double from 5.8m square metres in 2013, to 11.7m square metres by 2016.

A lot of the demand for panel displays comes from small and medium-sized handsets. Manufacturers with low-temperature polysilicon (LTPS) production capabilities will be more competitive in this space. The LTPS sector is also attracting increasing investment, helping further develop the medium and high-end mobile phone markets.

The entry barrier is high for LTPS production and manufacturers have to spend considerable time increasing the yield rate, claims WitsView. The manufacturer’s skill level is a highly critical factor in achieving a high yield rate in mass production of LTPS, and it usually requires six to nine months to increase the yield rate.

The highly competitive state of the market means smaller-sized panel makers will see their margins squeezed. Additionally, manufacturers who are late in adding LTPS production capabilities will see considerable pressure.

Among current mid and high-end mobile phone panel suppliers, the Japanese firm Japan Display Inc. (JDI) has a 30 percent share of global LTPS production capacity. Besides providing stable LTPS supply to Apple, it must seek new avenues to digest its large production.

While JDI’s mobile phone panels have a technological edge over the competition, competition in China’s mobile phone market is intense enough that JDI will also need to use a low-pricing strategy to stay ahead.

In South Korea, Samsung Display will have to start selling its AMOLED panels to other handset manufacturers in 2015. The panels were previously exclusively used for Samsung’s high end mobile phones, but cooling demand for those handsets means it needs to look elsewhere for revenue.

At the same time, with the amorphous silicon production process improving, some panel manufacturers have started to try to differentiate themselves by producing a panel with a resolution higher than ppi 400.

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