Category: The Front Line
Financiers Focus on Flexible Displays
- Published on Thursday, 17 October 2013 13:04
- Ken Werner
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On Wednesday, October 16th — a day that came close to living in infamy — I stood on a New Haven Line station platform and, luckily, thought to check my email. I was on my way to a luncheon presentation for a large New York financial advisory group that wanted me to speak on the present and future of flexible displays, and answer questions about where the investment opportunities might lie.
Instead, I checked my phone, saw an urgent request to call my contact, and found that the threatened Congressional refusal to raise the debt ceiling had required the folks who would otherwise be attending my presentation to busily help clients navigate their ways through a volatile market. So, meeting rescheduled.
The interest in flexible displays goes far beyond the investment group I will eventually address. A quick look around the Web will show lots of interest from the investment and consumer electronic communities. Despite the intense interest, it seems many people don’t realize that using a flexible display doesn’t mean the end product will be flexible. The Samsung Galaxy Round, introduced last week to the Korean market, is a perfect example.
The Round uses a flexible 5.7-inch, Full HD, Super AMOLED display, which is used to enable a product that curves gently around a vertical axis. The curved case, however, is every bit as rigid as comparable flat cases. Indeed, Samsung seems to have struggled to figure out what a rigid curved case night be good for. Reportedly, this rather large phablet fits comfortable in a user’s hand, thanks in part to the curve. Samsung has also designed the software to respond to the case being rocked when its convex side is lying on a flat surface. (When the device is rocked in sleep mode, basic information appears on the home screen.) LG Electronics has also promised a curved phone for 2014.
Why is the Round being offered only in the Korean market, at least at first? We can speculate that Samsung wants to work out any bugs while volumes are relatively small, or that manufacturing capacity is limited, or that manufacturing yield for the flexible display is low. If capacity or yield (the two can be related) is low, why might that be? One possibility is that flexible OLED displays require flexible moisture barriers. Effective flexible barrier films have been expensive and may not be available in large quantities. However, the fact that this flexible display is of the “bend-once” variety may allow the use of a simpler barrier-film structure.
When many people think of a flexible display, they think of the “flex-many” type, which could be rolled up inside a small cylinder and unrolled whenever you want to use it, assuming the particular design allowed the display to be rolled to a small radius of curvature multiple times without deterioration of performance. Although we have seen technology demonstrations of such concepts, there are no commercial products now and probably will not be for some time. When we do see the first flex-many products, they will probably have limited flexibility, such as the concept shown in the graphic.
What is delaying the introduction of flex-many products? The answer is: almost everything. Not only must the display itself (including the backplane and barrier film) be flexible and not deteriorate over many flexing cycles, but so must the other components of the device, including the touch screen, circuit boards, and battery. Hard switches and buttons must either be eliminated or designed to work with a flexing substrate and, perhaps, case. None of this is easy, but solving the problems are where the product and investment opportunities lie. That is what I will be discussing with the New York investment group when the current economic tensions die down.
A True Revolution in Display and Touch-screen Manufacturing Begins
- Published on Wednesday, 09 October 2013 17:45
- Ken Werner
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On the morniing of October 3rd, three companies announced the formation of a joint venture that will place into volume production a transparent conductor that is much more flexible, more electrically conductive, more optically transparent, and less expensive than the material that has been the standard solution for decades, and still is.
That standard solution is indium tin oxide (ITO), and it is used in most of the touch screens and electronic displays manufactured today, from LCDs and OLEDs for cell phones to the giant LCDs in the largest TV sets, digital signs, and public information displays.
In the U.S., Cambrios (Sunnyvale, California) announced the formation of TPK Film Solutions, Ltd. (TPKF), a joint venture with TPK, the world’s largest touch solution provider, and NISSHA, a leader in film-based touch sensors. TPKF’s mission is to “produce ClearOhm silver nanowire-based film in a roll-to-roll process allowing original equipment manufacturers (OEMs) to bring to market cuttng-edge touchscreens for new products and applications worldwide,” Cambrios announced in its press release. The joint venture agreement, which expands upon an existing agreement with TPK, was formerly signed on Oct. 3rd; volume production is anticipated beginning in Q2’14.
All of this may not sound too exciting until you understand not only that transparent conductors are essential components of most displays and touch screens, but also that ITO has significant limitations. As a result, the industry has wanted a viable replacement for ITO for some time; now, one is finally available.
So, what’s wrong with ITO? First, one of its key ingredients, indium, is relatively rare and is found in very low concentrations in various metal ores. As a result, it can be economically extracted only as a by-product of mining these higher-volume ores, primarily zinc sulfide. Roughly half of the world’s indium supply currently comes from China.
Although there isn’t an overall shortage of indium reserves relative to demand, the price has been cyclical, with cycles since 1985 typified by rapid increases and gradual decreases. The last price peak, in 2005, was a high one, topping out at about $1100 per kilogram (kg). The bottom of the price cycle in 2009 was almost as much as the previous two peaks. In January 2011, the price of pure indium was about $800/kg. (Data courtesy of the Polinares Consortium, a project of the European Union. The U.S. Geological Survey normally provides similar data, but the USGS Website is currently inoperative as a result of the U.S. government shutdown.)
The rising price trend is due to the increase in manufacturing of flat-panel displays, touch screens, and solar cells. The 2006 spike was due in part to a downturn in the production of zinc. Bottom line: the price and supply of indium are largely outside the control of the companies in the display and touch-screen industries who buy it, and even, to a significant degree, of the companies that sell it. Thus, when a leading supplier of indium responds to the current tight supply by saying on its Website, “The Indium Corporation believes higher prices will draw forward additional supplies which will alleviate any scarcity,” the thinking sounds wishful.
Price and supply issues have aggravated ulcers in the display industry from time to time, but that would not be enough to motivate a transition to alternatives if ITO were a really good transparent conductor. Although it has been good enough for the most part until recently, the evolution of displays and touch screens are making its shortcomings more and more troublesome. Although ITO does have good optical transparency, it is not a particularly good electrical conductor. The electrical resistance of thin-film conductors is expressed by its sheet resistance, which is measured in “ohms/square,” a metric that describes the material itself and is independent of the area of the film or its thickness.
Optical transmission of a transparent conductor varies with its sheet resistance, so it is useful to characterize these materials by plotting their transmission vs their sheet resistance. (See chart.) The ClearOhm silver nanowire material itself has, impressively, an optical transmission of between 99% and 100% at sheet resistances from 50 ohms/sq up, and ITO is only a couple of percentage points behind at over 150 ohms/square. Note, however, that it is difficult to make ITO with low sheet resistance and still maintain acceptable transmission. Whether its ClearOhm, ITO, or an alternative, the transparent conductor has to be applied to a substrate. That substrate has often been glass, but is increasingly likely to be a flexible polymer. The most popular of these is polyethylene terephthalate or PET. As you can see on the chart, a 125 micrometer sheet of PET absorbs more light than either the silver nanowire ink or the ITO that is applied to it, but the overall transmission is still over 90%, and ClearOhm maintains that down to 25 ohms/square.
If you make a touch screen using a transparent conductor on a thin sheet of PET, it is thinner, lighter, and more rugged than a similar touch screen made on glass, so there is an advantage to using a PET touch screen even if it is applied to a glass display that is not designed to bend, and this is especially true for a portable device such as a cell phone or tablet. Another advantage is that PET is more amenable to inexpensive roll-to-roll processing than is glass. (Please note, however, that Corning and Asahi Glass now offer display glass that is so thin that it can be rolled.)
But, ultimately, if you are making a touch screen on a flexible substrate, you would like to use its flexibility as well as its thinness and light weight. Here, brittle ITO falls flat. If you apply ITO to a PET substrate and wrap the PET around a rather small-diameter cylinder, cracks will appear in the ITO after only one wrap/unwrap cycle and the sheet resistance will rapidly increase by a factor of 1000 or more. The sheet resistance of silver nanowire ink, on the other hand increases only very slightly over 50 cycles. (See chart.) ITO can survive a significantly more gentle bend, particularly in a “bend-once” application.
So, silver nanowire technology produces transparent conductors with lower sheet resistance, higher optical transmissivity, and much greater flexibility than ITO, but, in addition, it does so at lower cost. This may sound too good to be true, but it isn’t. Jason Heikenfeld, Director of the Novel Devices Laboratory and an Associate Professor in the School of Electronics and Computing Systems at the University of Cincinnati recently told me in a personal (but not secret) communication: “We have used ClearOhm here and validated it. It is amazing in performance and can be patterned quite well. Clear-Ohm already costs less than ITO and beats the competition in performance. It is a great product.”
TPK Chairman Michael Chiang explained his company’s investment in the TPKF joint venture by saying, “Silver nanowires are a major part of our strategy to address the mid- and low-end segments of the mobile devices market. We will deliver high-volume manufacturing capacity for ClearOhm films for incorporation into leading consumer electronic devices including mobile phones, tablets and large-area touchscreen applications.”
On October 1st, Cambrios announced a significant design win. Lenovo will use ClearOhm in its new 20-inch-class All-in-One computer, the Lenovo Flex 20. “When seeking a technology to support our Flex 20 All-in-One computer touchscreen, we actively looked for a solution that not only delivered a high-performance experience, but also lowered the price point for our end-users. Cambrios’ ClearOhm transparent conductors answer this challenge and collectively, we delivered a best-in-class product,” said Sam Dusi, Director of Worldwide Strategic Alliances for Lenovo in the press release announcing the design win.
Cambrios has been is semi-stealth mode for most of its ten-year history. That time is clearly over and, with it, the unquestioned hegemony of ITO for transparent conductors. That hegemony will be further eroded by other competing technologies, but, for now, only ClearOhm is commercially available in significant volumes.
Expect a series of new ClearOhm design wins to be announced over the next few months, including at least one very, very big one.
Tough Times Ahead For Toshiba
- Published on Monday, 07 October 2013 18:02
- Pete Putman
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Toshiba, that industrial giant and manufacturer of everything from notebook computers to copiers, lighting equipment, and electronic components, is shutting down two of its overseas television manufacturing facilities and laying off about 3,000 employees worldwide from its “visual products businesses” (their words).
While we hear almost weekly about the struggles of Sharp, Sony, and Panasonic to attain profitability in the TV business, we don’t hear much about Toshiba. Given what we do know – they source their LCD panels from other manufacturers and have a worldwide market share below 5% – it should be no surprise that the company is struggling to make ends meet with televisions.
Last August, Toshiba’s CEO Hisao Tanaka stated in a Wall Street Journal interview that he would not “…pull the plug on the company’s unprofitable television and personal-computer operations, shunning the “easy option” of exiting cutthroat competition for a chance to reclaim its former prominence in the businesses.”
Another quote from the story is apt: “There’s a perception that a conglomerate with a lot of businesses may cancel out the benefits [of size],” said Mr. Tanaka, explaining the so-called conglomerate discount. “I think we can use a lot of the technologies that we as a conglomerate have by integrating or merging them and turn the discount into a premium.”
The WSJ story detailed how Toshiba had been profitable overall the past three fiscal years, lifted by sales in flash memory and power equipment. Those profits must have been substantial to overcome losses exceeding ¥50 billion ($512 million) at its TV operations in each of the past two years.
Tanaka’s plan in August was to move 400 Japanese employees out of the TV and personal computer operations and cut back on the number of TV models in the line. Well, it looks like things took a bit of a turn for the worse since then.
Toshiba’s 9/30 press release states that the company will “…increase products from original design manufacturers (ODMs) in the global market from the current rate of about 40% to 70% by FY 2014. The company further plans to reduce fixed costs and improve productivity by reducing the number of ODMs and models, and by integrating manufacturing facilities.”
Translation: Toshiba will out-source manufacturing of what remaining LCD TVs it sells to the tune of 70% of its product line, and it’s a good bet most of those TVs will come from Chinese factories. Toshiba also plans to merge its television and CE operations with its appliance operations, creating a new entity known as Toshiba Consumer Electronics Corporation.
Intriguingly, it also appears that Toshiba is going all-in with UHDTV. “Toshiba will allocate resources to large-screen Ultra HD (4K) LCD TVs, where growing demand is expected, to differentiated functions for viewing and recording…the company will also reinforce development of visual products for business applications, including digital signage, another area where demand is growing.”
More intriguingly, the press release stated that “…Toshiba will focus on emerging markets including Asia, the Middle East, and Africa, where growth in demand is expected. In addition, Toshiba will end sales in unprofitable regions.” Hmmm…could one of those “unprofitable regions” be North America?
In summary, another venerable Japanese TV brand has been decimated by the brutal economics of the 21st century, where Korean TV brands are playing Family Feud with curved OLED TVs while the Chinese are quietly but aggressively establishing a beachhead in 4K LCD TV manufacturing.
Toshiba sure talks a good game. Now, can they “walk the talk?”
Who ARE Those Guys?
- Published on Monday, 30 September 2013 10:34
- Pete Putman
- 0 Comments
A recent article on the Reuters Web site details how Chinese LCD TV manufacturers are quickly gaining ground on Korean TV heavyweights LG and Samsung – and they’ve used UHDTV, a barely-hatched technology, to do it.
According to the Reuters story, LG and Samsung were so focused on one-upping each other in the still-gestating OLED TV business that mainland brands like BOE Technology and TCL and Taiwan-based Innolux and AU Optronics managed to sneak into the party and capture significant sales of 4K UHDTV sets using conventional LCD technology.
Until last year, a paltry 33,000 UHDTV sets had been sold worldwide (200M 2K and 720p LCD TVs were sold during the same time period). But shipments of 4K TVs have since multiplied by 20 times, based on data from IHS. And the Chinese are a big reason why.
In a rare moment of candor, LG Display’s CEO Han Sang-beom was quoted as saying, “…I have to admit that we hadn’t fully appreciated the potential of the UHD market. We assumed it’ll be too early for this type of display to take off, and thus didn’t think much of having diverse UHD product line-ups, especially in the low end. But I think we are not late just yet and we are working hard to lead the market here.”
In Q2 ‘13, BOE Technology reported an 8.9 percent operating profit margin, while China Star Optoelectronics Technology (CSOT), a unit of TCL Corp, achieved a 9.6 percent margin. LG Display, the world’s No.1 LCD maker, posted a 5.6 percent margin, while Samsung Display, a unit of Samsung Electronics, had a whopping margin of 13 percent. But take out the OLED business and Samsung’s LCD margin drops to somewhere between 3 and 7 percent.
To show you just how severely the winds have changed against Japanese TV manufacturers, Sharp Corporation – the company that basically invented the LCD TV – reported a 0.5 percent profit margin for Q2 ’13, after several quarters of red ink.
Can the Chinese do to Korea what the Koreans did to the Japanese? It’s entirely possible: During the same Q1 ’13, global TV shipments grew by 4% Y-Y, according to NPD DisplaySearch. But all of that growth was in mainland China, where TV shipments ramped up an astonishing 28% Y-Y. Take out those numbers from the overall worldwide shipments total, and LCD TV shipments actually declined almost 4% Y-Y.
In recent weeks, we’ve seen a flurry of 4K and UHDTV announcements from Panasonic, Sony, and now Sharp. The latter, which unveiled a 70-inch 4K set (LC-70UD1U) at CE Week back in June, is now shipping it and the SRP (so far) is $7,500. Keep in mind that Sony brought out its LGD-manufactured 84-inch 4K LCD TV for $25K a year ago; LG dropped that price by $5K not to long after, and JVC’s 4K monitor version (also using the same LGD panel) is available for $15K.
Samsung and Sony both have 4K LCD TVs in the 55″ – 65″ range that are retailing for about $90 – $100 per diagonal inch. That’s quite a drop from the nearly $300/diagonal inch that Sony started out with in 2012!
There’s no question that everyone is jumping the gun on pricing, and it’s most likely due to worries about the new crop of UHDTVs from from what is becoming the world’s fastest-growing market for consumer electronics devices.
It took over a decade for 2K HDTV to really get established in the market. Then, prices collapsed, and with them, operating margins. Will 4K follow that same timetable, or will it make even faster inroads?
Fans of the 1969 movie Butch Cassidy and the Sundance Kid will recall how those two fled the U.S. for supposedly safer quarters in South America. And yet, their pursuers stayed doggedly on their trail, following them all the way to Bolivia. “Who ARE those guys?” asked Robert Redford, over and over as they were flushed from yet another supposedly-secure hiding place.
Now, Samsung, LG, and Japan Inc. may very well be asking the same thing…
E Ink Raises the Electrophoretic Bar
- Published on Monday, 16 September 2013 13:29
- Ken Werner
- 0 Comments
E Ink recently announced the availability of Carta, its new electrophoretic imaging film, which will be the face of Amazon’s new Kindle Paperwhite eReader. The Paperwhite can be pre-ordered now and will ship on September 30.
What Carta does, said E Ink Product Management Director Giovanni Mancini in an exclusive phone conversation on September 10, is replace both the black and white pigmented particles used in Pearl, the company’s previous top-of-the-line display film, with new pigments. These pigments offer a blacker black and a whiter white. Combined with some processing changes, the result is an increase in reflectivity to 50% from Pearl’s 41%. The contrast ratio jumps to 15:1 from 10:1. Mechanically, said Mancini, Carta is similar to Pearl.
Carta does not replace Pearl, which will still be available at its existing price. E Ink’s intention is for Carta to be sold at 10% to 30% premium of Pearl, and expects first-tier eReader brands to migrate to Carta over the next year or so.
Although the pigments are the biggest factor in the improved performance, it turns out that changing the order in which some assembly processes are performed and improve the film’s reflectivity. Previously, for example, E Ink applied adhesive the previously assembled display layers and then applied the ITO electrode layer to it. Now, the company applies the adhesive to the ITO layer and then lays the ITO layer, and sees an improvement in the brightness of the white state.
Another recent announcement is for E-Ink Regal, a new driving waveform. When a signal changes the state of a portion of the display from black to white, or from one gray level to another, the pigmented particles are accelerated to their new positions. Although the particles have very little mass, they must still be actively decelerated to maintain precise levels and sharp character edges. Regal is a new, more complicated waveform for doing this more precisely. Regal can be applied to both Carta and Pearl, controls edge artifacts on bothe imaging films. In addition, Regal allows full-page refreshes, which some readers find annoying, to be performed much less frequently. A Pearl display without Regal must receive a full-page refresh every five pages. With Regal, that becomes every 100 pages, which means that in many cases there won’t be a refresh in an entire reading session.
Regal is available to customers as an option for both Carta and Pearl. Tuning Regal waveforms is more complex and time-consuming than tuning the simpler standard waveform, and constitutes a one-time cost for each product model to which it is applied. So, the unit cost for incorporating Regal depends strongly on the quantity of panels to be produced. By making Regal an option, product managers are free to tailor their products to individual market profiles. The new Kobo 6-inch eReader, said Mancini, uses Pearl with the Regal waveform, and Kobo advertises “smoother page transitions.”
The eReader market is mature and is stabilizing at 12 to 15 million units a year. That’s not a bad business, but E Ink is working on other applications and is encouraged to find customers developing new product, said Mancini. Among these products are snap-on covers for the Samsung Galazy S4 smart phone that integrate 4.3-inch E Ink displays. Samsung itself makes hinged covers (without the display) that snap on to the back of the handset in place of the existing battery cover and then wrap around to provide a very slim and lightweight cover. The display covers follow the same pattern, but include the E Ink display, which is very thin. The user can then choose to read either from the E Ink display or from the handset’s own OLED display. The E Ink display would be the obvous choice in bright sunlight, and one manufacturer has said that missed-call and SMS information would also apper on the E Ink display.
Covers have been developed by PocketBook and TCL-Alcatel. The electrical connection for PocketBook’s PocketCover is through the phone’s micro-USB port. TCL-Alcatel connects through the side of the phone. Both companies plan to start volume product in October, beginning with the European market. PocketBook Readers Sales Manager Enrico Muller, said this is a highly anticipated product and that the company plans to produce models for other smart phones, such as Sony and HTC, as quickly as possible. Apparently, the product’s introduction at IFA supported the company’s enthusiasm.
In a less-than-clear press release, Plastic Logic seemed to say that it would be producing the subsequent generation of E Ink display for PocketBook, and that the size of that second-generation display would be 4.8 inches on the diagonal.
Smart covers appear to be an ideal application for electrophoretic displays. With significant electrophoretic technical improvements already here, with the introduction of new eReader models, and with new applications on the way, it seems the comments of electrophoretic pessimists are overwrought. My interview with Giovanni Mancini closed with his cheerfully adapting a quote from Mark Twain: “The news of our death has been greatly exaggerated.”