Issue



Consumer economics drive FPD manufacturing strategies


11/01/2005







The challenge in discussing flat-panel displays (FPD) is that they are both a technology and an application. For example, the thin-film transistor liquid-crystal display (TFT-LCD) is a very specific technology that comprises an electronic backplane and an electro-optical frontplane. This technology combination results in an application, which is a transmissive electronic display (and can also be reflective and transflective). The TFT-LCD is quite different structurally and functionally from a plasma display panel (PDP), which emits, rather than transmits, light. From an application standpoint, the LCD is ubiquitous in portable PCs and suitable in products as varied as cell phones, desktop monitors, and TVs. PDPs, however, seem to have found a niche in large-area markets such as signage and TV.

Worldwide FPD revenue stayed steady in 2004 and 2005 at ~$62 billion, but it is expected to increase 14% in 2006 to $73.4 million [1]. This year, cell phones will be the FPD volume leader, followed by other applications with small and medium form factors. Desktop monitors are only No. 8 in manufacturing volume, but are ranked No. 1 in revenue at $17.1 billion. Notebook displays will generate $7.7 billion in revenue this year. And, as a whole, the FPD industry is supported by an equipment and materials supply chain valued at $46.7 billion.

Soon, this industry will be all about flat TVs. Currently ranked only No. 18 in production volume, the FPD-TV sectors rank No. 4 (LCD) and No. 5 (PDP) in revenue. Together, these products will generate more than $11.2 billion in revenue in 2005.

LCD-TVs are expected to garner the largest market share, yet for adoption to become mainstream, price points must be reduced, which will only be made possible through higher yields, lower material costs, or technical innovation. This is no small issue in the FPD industry, with increased complexity, as well as glass substrate sizes increasing from 6 ft2 (Gen 1, 1993) to more than 42 ft2 (Gen 7, 2004).

Business and technology strategies

So, how will the industry get to price points that will spur the FPD-TV market and resonate with today’s cost-conscious consumer? The answers lie in the FPD manufacturers’ business and technology strategies. From a business perspective, LCD manufacturers will move to larger substrates (Gen 7/Gen 8), obtaining more and larger displays per panel, and greater productivity. An increased emphasis on reducing key component costs, including filters, films, drivers, and backlights, can be expected. A component shortage often limits LCD production, so some manufacturers want more vendors, hoping to spur supply and competition while increasing quality.


Worldwide FPD revenue. (Source: USDC Worldwide FPD Market Growth Report Q1’05, DisplaySearch)
Click here to enlarge image

Finally, it would not be surprising to see the major LCD and PDP manufacturers, most of whom also are consumer goods makers, look at reducing distribution costs. This can be achieved by bypassing the “big box” consumer electronics retailers and selling directly to customers via advertising and e-commerce. This “electronic storefront” - common in selling computers and peripherals directly to the customer - would lower, if not eliminate, the retail channel margin of selling FPD TVs, estimated at 20%-40%. Installation and service, however, will be a serious issue for companies that go directly to the customer. Consumers may tolerate long holds on the telephone for technical support - and occasional product returns - for PCs, DVDs, digital cameras, etc. But are they willing to endure the same scenarios for TVs, which are the primary source of news and home entertainment?

From a technology perspective, industry migration toward large-area substrates places greater emphasis on improving/maximizing yields to maintain the cost advantage of these higher-productivity fabs. High-performance LCD-TVs increase the complexities associated with manufacturing, especially when dealing with color filters on array and viewing angle technologies. Moreover, FPD fabs are not getting cleaner as they get bigger, and today’s larger glass substrates have become too large for human inspection. Because of the expense of materials used in LCD manufacturing, defective LCDs (especially in larger displays) are driving up both panel and end-product costs. Yield management solutions will optimize fab operation and improve margins, equating to lower price points. As such, reliable
epeatable methods of analyzing production line data and repairing process-related defects are essential to enable the production of larger, higher-quality LCDs at affordable price points.

The future is in flexible displays

As for the future of FPDs, the industry is setting its sights on flexible displays. Such a revolutionary paradigm shift in display manufacturing would further reduce weight and thickness (currently 0.7mm glass) yet allow a rugged product, opening up a number of new applications.

Rugged displays are not a novel concept. Military product integrators have long sought to package a display that would be virtually impervious to shock, vibration, electromagnetic interference, extreme temperatures, and other conditions. Customizing a display comes at a price, easily resulting in a 10× increase in display module cost.

The initial concept for flexible displays is a conformable device that could be shaped to suit a particular application and fabricated on glass, stainless steel, or plastic. Collaboration between industry players, government, and academia, along with increasing investment in flexible display R&D, is bringing this concept to reality. In fact, a number of important supply chain projects, funded by USDC, are currently underway. The projects are focused on exploring the advances in materials and manufacturing technologies needed to achieve a flexible display, including the following:

  • Modeling - factory layout, including potential tools and processes, and comparison to glass-based manufacturing;
  • substrates;
  • barrier layers and device encapsulation;
  • materials and inks; and
  • tools (e.g., deposition, lithography).

By establishing a reliable supply chain for flexible electronic backplanes, various technologies can then jockey for the electronic frontplane position, including OLEDs, electrophoretic LCDs, etc.

The Flexible Display Center (FDC) at Arizona State U. was established last year by the US Army to develop display prototypes and electronic backplanes. With a 6 in. prototyping line in place and plans for a Gen 2 manufacturing line in place by the end of 2006, the FDC provides a capability to tie together USDC’s supply chain program and potential display manufacturers.

Once flexible electronics can be produced to commercial standards and in limited quantities, the next logical step is a transfer to roll-to-roll (R2R) manufacturing. Currently, most advanced electronic components are produced on flat and rigid silicon or quartz wafers or on specialized glass plates in a batch process - the backbone of the IC and FPD industries. An R2R process means that the components can be produced more efficiently, at higher yields, and at a lower cost because material handling is reduced and throughput rate is increased with a continuous web process. The expected R2R result is conformable, rugged, lightweight electronic components and displays for various markets.

Earlier this year, USDC announced a contract with Binghamton U. to develop an experimental facility that can develop processes and prototype microelectronic products in a R2R format. The university’s Center for Advanced Microelectronics Manufacturing will use federal and state funding and build on tool donations from USDC, including lithography and deposition equipment along with deposition sources. The result is an integrated program in support of flexible microelectronics and displays, including the supply chain, to prototype products to large-scale, R2R manufacturing.

Acknowledgments

The author would like to thank M.R. Pinnel of USDC, Ms. Marie Labrie of MCA, and Photon Dynamics Inc. for their help in writing and editing this article.

Reference

  1. Industry data in this article is principally from the USDC Worldwide FPD Market Growth Report Q1’05, courtesy of DisplaySearch, Austin, TX, unless otherwise cited.

Michael Ciesinski is president of the US Display Consortium - an industry-led public/private partnership providing a common platform for flat-panel display manufacturers and developers, FPD users, and the supplier base. He may be contacted at US Display Consortium, 84 W. Santa Clara St., Ste. 790, San Jose, CA 95113; ph 408/993-8111, e-mail [email protected].