A week and a day ago, I gave the luncheon keynote address at the Nomura Pan-Asia Technology Forum at the Island Shangri-La Hotel in Hong Kong. The Forum’s audience consists of financial analysts and investors, and my piece was an overview of OLED display and manufacturing issues, with an emphasis on what that might mean for investors.
The audience was appreciative. But for me, the conference was as at least as interesting for what I learned as for what I taught. Here are some examples.
Champ Shin, Head of LG Display’s Strategy and Marketing Center made it very clear that the film patterned retarder (FPR) approach to 3D-TV is a major strategic direction for LGD. He said the FPR has 60% of the 3D-TV market in China and 45% in Korea. On the significant loss of brightness (about 80%) with the competing switching-glasses 3D technology championed by arch-rival Samsung, Shin said the reason was because Samsung uses black data insertion (BDI), which results in an image being presented to each eye only 25% of the time with the field being dark for 75% of the time.
In the Q&A I asked Shin how much the addition of the FPR adds to the cost of the panel. Without hesitation, he answered that it adds about 20% to total panel cost for 42-inch and 47-inch panels. In answer to another question, Shin said that aligning the FPR film to the LCD panel is not easy, and obtaining an adequate supply of the film is difficult. That is why FPR-TV was initially introduced to the China market only. Now, it has been expanded to Korea, and it will be introduced to the U.S. market next month. Then Europe.
He went on to say that the lamination process for monitors is more difficult than for TV because the FPR has to be aligned to a smaller pixel pitch.
On the subject of display technologies for mobile use, Shin asked rhetorically, "Is OLED really best?" He then answered his own question: "In a short time we will decide which way to go. When we decide, we will tell you how we plan to go."
Richard Windsor, Nomura’s Global Technology Marketing Analyst, observed that smart phones are beginning to move to the middle and even lower price points. He noted that Apple has not been successful in putting a lower price on its previous model while retaining a premium price for its newest model. People just buy the new model. Therefore, Windsor said, if Apple wishes to play in the growing market for moderately priced smart phones, it will have to design a new model especially for that niche. That is an eminently sensible thing to do, he said, and this is the time for Apple to be developing the new model. Unfortunately for this theory, though, there is absolutely no indication that Apple is proceeding in this direction.
Myung Kun Kim, Vice President of Samsung Electronics said that Samsung’s smart phone business is good, providing a 10% margin, and the market response to the new Galaxy S2 smart phone is very good. The new 10.1-inch tablet PC will be introduced in June; an 8.9-inch in July. The 8.9-inch will enable tablets that are thinner and lighter than the iPad, he said, and the price cannot be more than $499.
In the Q&A, a questioner commented that tablet makers had been looking for a 30% margin, and that had created problems with pricing. Kim answered that a $499 tablet might not be profitable but would not lose money.
Samsung had previously projected they would introduce an AMOLED Galaxy Tab in the middle of this year. Since this would require the use of panels the factory couldn’t be making yet, I’ve been skeptical of that projection. So I asked Kim about the introduction. His answer: "The timing on the AMOLED tablet needs to be worked out as manufacturing evolves."
There’s more to report on what was said at the Nomura Forum, but I’ve run out of space. I will add one thing, though. Hong Kong is a vibrant city, and the English-language South China Morning Post is a scrappy, muck-raking newspaper that does not spare the powerful and wealthy of either Hong Kong or mainland China.