Samsung Display President Lee Cheong issued a warning to the Korea Display Industry Association that the country’s OLED display making industry could soon be surpassed by that of China, similar to how it rose to dominate LCD display manufacturing.
Cheong was speaking to the Korean newspaper Chosun Biz, and he said it is “very concerning” that Chinese corporations appear to be closing the gap in the OLED display making segment.
“There is clearly still a difference in advanced technological capabilities,” he said, but he warned that Chinese companies are making rapid progress and getting closer to matching South Korean display makers.
The rise of China’s display making industry mirrors South Korea’s own journey that saw it surpass Japanese display makers more than 20 years ago. Ultimately, Samsung Display and LG Display became so dominant that the likes of Sony, Sharp and Panasonic halted LCD manufacturing altogether.
But the companies later got a taste of their own medicine as Chinese companies rose to the fore, muscling them out of the LCD panel production industry. These days, Samsung Display has quit making LCD panels altogether, while LG Display has been winding down its LCD operations, and is set for a final exit later this month.
Chinese display makers like BOE and TCL CSOT have outcompeted the Korean firms, manufacturing LCD displays at a lower cost. As a result, it became unprofitable for Samsung Display and LG Display to keep going, so they threw in the towel instead.
It means that LG Electronics and Samsung Electronics no longer buy their LCD panels from their own subsidiaries, but instead source them from their former Chinese competitors.
Meanwhile, LG Display and Samsung Display have switched their attention to making OLED displays, which are widely regarded as a superior technology. But China, ever-eager to expand into new markets, also has an eye on OLED, and the likes of BOE and TCL CSOT are both ramping up their OLED manufacturing operations.
For instance, TCL CSOT is manufacturing its inkjet-printed OLED panels for monitors, slowly increasing the scale of that operation. And BOE has announced plans to spend $9 billion on a new 8.6G OLED factory, where it will make large OLED panels for monitors, laptops, smartphones and, eventually even televisions. BOE has already surpassed Samsung Display in the smartphone OLED display segment.
If they’re able to repeat what they did with LCD panels, they could force the entire Korean display industry out of business, Cheong warned.
He told Chosun Biz that many in the business are extremely worried about China’s “fierce pursuit” of the organic light-emitting diode market.
“It is a very concerning aspect, and it is important how we can reopen the technology gap,” he added.
LG Display and Samsung Display have responded by accelerating the development of their respective WOLED and QD-OLED technologies, and these innovations have led to new panels that are progressively getting brighter and more energy-efficient with each passing year. LG Display has also been experimenting with transparent, flexible and even wearable OLED display concepts. But it remains to be seen how far they can push the needle on OLED, and there is also the danger that BOE and TCL CSOT will soon match their level of innovation.
Ultimately, the answer might be for South Korea’s display makers to focus on newer, more promising technologies. This week, it was reported that Samsung Display is looking to accelerate its plan to commercialize a new display technology called QD-LED, with the aim being to bring it to market in a “few years”. The company has also been working to popularise its MicroLED technology, but it remains extremely expensive.
However, they also face stiff competition with these newer displays, with the likes of Nanosys, Sharp and TCL CSOT also said to be investing in QD-LED.
