Market Insight

A year after large OLED TV launch, what is the future direction of OLED TV market?

April 28, 2014

Jerry Kang Jerry Kang Senior Principal Analyst, Emerging Display Technologies & OLED

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Skyworth, a unit of Hong Kong Skyworth Digital Holdings Co., launched OLED TV in March for the first time as a Chinese company. This comes nearly a year after LG Electronics Inc. rolled out OLED TV in January 2013 for the first time in the world. As Sony Corp, Toshiba Corp, Konka Group Co. and Sichuan Changhong Electric Co. are also moving to launch OLED TVs one after another within this year, the industry is closely watching whether OLED TVs will become popular from this year.

The Tianchi E980 OLED TV, launched by Skyworth early this year, uses LG Display Co.'s 55-inch curved full HD panel and sells for 29,999 yuan (about $4,800), which is about $1,000 cheaper than its US retail price of $5,999. The price of LG Electronics' 55-inch curved full HD OLED TV, released in June 2013 at $14,999, has fallen by more than half in less than a year. Such a rapid price fall will certainly help increase sales of OLED TVs. But considering that the LCD TV with similar specifications was sold at an average price of $1,500 in the first quarter of 2014, OLED TVs are about four times more expensive than LCD TVs. Prices should continue to go down for OLED TVs to appeal to the public.

 

Notably, the production cost of OLED panels, the core component of OLED TVs, has been falling steadily since their production began in December 2012. The driving force behind the lowered production cost of OLED panels is the gradually rising yields of each process such as backplane, evaporation and encapsulation. Different technological approaches through oxide TFT, open mask and metal sheet encapsulation, compared with those for small- and medium-sized OLED panels, helped to lead a rapid increase in yields.

But it will be somewhat challenging to commercialize OLED TVs with only an increase in yields. Ever since LG unveiled curved OLED TV in 2013, many TV makers have begun to develop curved TVs one by one. In the end, curved LCD TV was unveiled at CES 2014, proving that curved TV is not an exclusive property of OLED. Moreover, LCD panels applying the quantum dot BLU technology have emerged rapidly, threatening OLED whose color reproduction rate has been acclaimed as its exclusive strength.

Under the circumstances, existing OLED TV panel makers appear to be busy boosting the strengths of OLED TVs that can be clearly differentiated from those of LCD TVs. Now they are believed to focus on developing more efficient manufacturing methods and innovative form factors.

LG Display unveiled its ideas on rollable OLED TV and transparent OLED TV at “Korea Display Conference (KDC) 2014,” held by IHS Technology in April. The ideas are based on the perception that LCD panels can be curved but not rollable. Compared with LCD in which a color filter and a polarizing film deteriorate transmittance, OLED is believed to have advantages as a material of transparent panels. However, it is required to improve flexibility and transmittance dramatically of the materials and processes applied now, so it will be unlikely to realize the ideas in a short term.

Samsung Display Co., which launched 55-inch curved OLED panel following LG Display last year, had attempted to develop a high-performance OLED TV by separately depositing LTPS TFT and RGB. But since the latter half of last year, Samsung Display has found it difficult to raise the yield of OLED TV-use panels and it was unable to continue the production. In addition, the company is not insisting on the method of separately depositing LTPS TFT and RGB. It is now trying to secure various mass production technologies, such as soluble OLED, that can raise the production efficiency, while researching TV panels based on flexible OLED technology.

Panasonic Corp., which unveiled ultra HD OLED TV using soluble OLED at CES 2013, believes the soluble OLED technology is much more efficient in the amount of materials used, resolution and enlargement of screens than the thermal deposition method. Certainly, there exist technological difficulties in securing higher purity and longer life cycle in order to apply OLED luminescent  materials to the solution process. Gradual progress is being made for the soluble OLED technology, indicating that the commercialization of OLED is approaching us, albeit at a slow pace.

As such, the shape of OLED TV panels, which was flat in 2013, is highly likely to evolve into being curved in 2014 and then flexible or rollable afterward. The color patterning technology is most likely to rapidly change to the soluble method from the current thermal deposition method.

 

The sales volume of OLED TVs has been rising gradually since 2013. But according to Television Market Tracker Database, published by IHS Inc., from the perspective of the total flat TV industry, OLED TVs accounted for zero of the total sales of flat panel TVs in 2013. And this year, when Chinese and Japanese TV makers are set to launch curved OLED TVs, the share of OLED TVs is forecast to remain below 0.05%. As noted earlier, such a negligible market share of OLED TVs is because of OLED panel's high prices, and whether the OLED TV market will expand or not depends on how much each panel maker can reduce OLED panel production costs. Moreover, if rollable and flexible OLED TVs are unveiled to differentiate them from curved LCD TVs, they are likely to secure a certain market share regardless of their production costs.

Research by Market
Displays
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