Commentary:Growing AMOLED penetration puts pressure on makers of small- to mid-size LCD panels


Samsung Electronics, Nokia and HTC are all rolling handsets with AMOLED displays, accelerating the penetration of AMOLED applications in the handset market, with sales for such phones to grow exponentially in 2012. In addition, after AMOLED technology is used in tablet PCs it will also receive a lot of attention. At present, Samsung AMOLED panel production and technology is taking the lead with LG Display coming in second. Factories in Taiwan and China, however, are trying to catch up. It is estimated that AMOLED production capacity will ramp up sharply by 2013 or 2014. This means that small-size LCD supply chains will gradually receive more pressure in the next two years and manufacturers are eager to make the transition into AMOLED production.

Samsung's AMOLED mobile phone market layout continues to play a pioneering role, as it has a wide range of models featuring resolution that has been increased to more than 250ppi. Nokia also launched the N86, the Lumia 800 and other AMOLED mobile phones that have a resolution of around 200ppi, and will continue to launch new mobile phones that will have even higher resolution. HTC's AMOLED phone production at one point was delayed by insufficient panel supply, which affected the launching schedule and progress of its related phone series, but it is estimated to have a new start in 2012. As for AMOLED applications in tablet PCs, only Samsung at present has launched the 7.7-inch Galaxy Tab series and its sales will need to be observed in the future.

Samsung's smartphones that utilize AMOLED have seen increasing sales and approximately 41 million were sold in 2011. It is estimated that sales in 2012 will grow exponentially and Samsung hopes to reach its target of selling 90 million. Moreover, Samsung's sales figures estimate that in 2012 the Galaxy Tab will sell approximately 7.2 million. As for its TVs, Samsung hopes to see AMOLED TV visibility enhanced in 2015.

In fact, since AMOLED end products are subject to suppliers and are limited in number, they have not been able to soar in sales. But after Samsung Mobile Display (SMD) became the market leader, companies such as LG Display, AU Optronics (AUO), Chimei Innolux (CMI), Toshiba Mobile Display (TMD), Cigna, Pegasus Micro, BOE, and Irico are stepping up expansion on AMOLED production. SMD is also actively investing in factory expansion and is estimating that increased AMOLED production will fall between 2013 and 2014.

When comparing AMOLED and LTPS LCD in terms of response time, power consumption, weight, thickness and color performance, AMOLED outdoes LTPS LCD. However, AMOLEDS cost higher, but its production capacity is continually increasing, which makes it subject to price reduction in the future.

It is noteworthy that according to MasterLink Securitie's market analysis, AMOLED's rise will greatly impact small- to medium-size panel makers in Taiwan such as HannStar Display and Chunghwa Picture Tubes (CPT). Other small- to medium-size panel makers' share of the smartphone and tablet PC markets will also be impacted by AMOLED's rise and the LCD industry in Taiwan will be affected even more severely.

Backlight component makers including backlight unit (BLU) suppliers such as Optoelectronics and Radiant will also be affected by the rise of AMOLED technology along with prism sheet, light guide plate, optical film, diffusion plate, and LED light strip manufacturers will also be affected greatly. These manufacturers have been working on how to react to transform their business model and are developing LED lighting as their strategy. 


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