Troubled waters ahead for mobile displays?

SAN DIEGO, CA-In his presentation at the first Society for Information Displays (SID) Hot Topics Conference 2006 on Mobile Displays-aptly entitled “Mobile Displays Market Creates Big Waves”-Davis Lee, VP of Application Sales at LG.

SAN DIEGO, CA-In his presentation at the first Society for Information Displays (SID) Hot Topics Conference 2006 on Mobile Displays-aptly entitled “Mobile Displays Market Creates Big Waves”-Davis Lee, VP of Application Sales at LG.Philips LCD (Seoul, Korea), was referring not only to the overwhelming fact that nearly one billion mobile handsets will be sold in 2006, but that this wave of growth may be signaling troubled waters ahead for the mobile display industry. Despite this tremendous growth for mobile displays in cell phones alone, Lee made it clear (as did many other presenters) that end-user prices for mobile handsets with displays are dropping faster than new sales, putting added cost-reduction pressure on display suppliers.

Even though Lee’s assessment followed presentations by market research firms iSuppli Corporation (El Segundo, CA) and DisplaySearch (Austin, TX) that raised similar concerns that the value growth in the mobile displays market will peak in 2007, Lee jokingly commented to Paul Semenza, VP of Display and Consumer Research at iSuppli, that “Industry forecasts have never been right” and hopefully demand will grow faster than projected and technology innovations will continue to make the market a profitable one.

Held in San Diego, CA October 3-5, the Hot Topics conference targeted new developments in mobile displays that are used in cell phones, PDAs, GPS handsets, and even mobile personal computers-one of the newer entrants to the mobile display market.

With just over 200 attendees and 40 speakers, the conference turnout was a clear indication that mobile displays are a “hot topic” in the display marketplace; in fact, with a long list of over 20 mobile display suppliers all competing for future customers (and industry consolidation looming), the marketplace analysis sessions proved much more popular than the architectures and interfaces sessions, judging by the large number of questions in the former sessions and few questions in the latter. I spoke with one manufacturer in the thin-film transistor liquid crystal display (TFT LCD) camp who was keen to find out whether newer technologies like organic light-emitting diode (OLED) displays from Samsung (www.samsung.com) or microelectromechanical systems (MEMS)-based interferometric modulator display (iMoD) technology from QUALCOMM (www.qualcomm.com) would cannibalize his customer base and jeopardize his job.

While a large portion of the SID Hot Topics conference focused on the existing and emerging display technologies that are enabling tremendous volume growth in the mobile display market, presentations from Vinita Jakhanwal, Principal Analyst, Mobile Displays at iSuppli, and Barry Young, senior VP at DisplaySearch, focused on quantifying trends for the mobile display market. Both market research firms forecast volumes of around 1 billion mobile handset displays in 2006, with active-matrix LCD technology (such as TFT LCD and OLED) growing and passive-matrix LCD shrinking. By 2010, active-matrix OLED (AMOLED) technology will be cost competitive with TFT LCD, although AMOLED technology today is roughly twice as expensive as TFT LCD.

Jim Zhuang, manager of Motorola Display Design Center (www.motorola.com), said that the cell phone is becoming so complex and functional that it may eventually displace the personal computer as THE mobile device of the future. But he did caution that even though developed countries are seeing growth in replacement “smart” cell phone technologies, the next wave of growth for the mobile display market is for third-world countries that will be seeking lower-cost, entry-level “less is more” cellular technologies, perhaps with monochrome displays (such as electrophoretic technology from E-ink; see www.laserfocusworld.com/articles/257207) and a sales price of around ten dollars.

Growth in the low-cost display market contrasts with projected growth in the high-end ultra-mobile personal computer (UMPC) display market described by Achintya Bhowmik, manager in the Mobility Group of Intel Corporation (www.intel.com). Bhowmik noted that Intel is investing in UMPC display providers through Intel Capital. A key activity for these suppliers will be figuring out how to reduce the 30-40% power consumption for the display itself as a percentage of the overall power requirement for a mobile device. Power efficiency is a huge concern for future “smart” mobile devices, considering that according to Jyrki Kimmel, leader of display research at the Nokia Research Center (Finland), more than 25% of the mobile phones with displays have 1.5-2 megapixel cameras that compete for this power budget along with such future innovations as mobile television.

Paul Semenza of iSuppli says that the display industry should be making way for the “mobile handset-it’s not just a mobile phone,” alluding to the fact that suppliers want to replace your keys, wallet, and mobile phone (the three things you wouldn’t leave home without) by a mobile handset that performs all of your daily functions (including Web browsing). Considering that the flat-panel display (FPD) industry is approaching 1/3 the size of the total semiconductor business according to Joe Virginia, VP of Samsung’s LCD Business, Semenza may be accurate in his prediction of further mobile-display ingress into our daily lives.

Although both iSuppli and DisplaySearch see troubled waters in the value of the mobile display market, they are encouraged that new lower-cost, energy-efficient technologies could change that value proposition. Barry Young at DisplaySearch said, “In the developing world, people don’t want a $100 laptop, they want a mobile phone to talk to people.” Young and others hope that emerging technologies like E-ink, iMoD, flexible displays from a number of manufacturers (see www.laserfocusworld.com/articles/259916), and even electrowetting displays from Philips spin-off Liquavista (Eindhoven, The Netherlands), for example, may improve market profitability.

Although Kraig Kawada, senior director of the LCD Business Unit at Sharp Microelectronics of the Americas (www.sharpsma.com), said that there is no predictability of sales in emerging mobile display markets, he emphasized that local market needs, time-to-market, and display manufacturing capacity were all critical for achieving profitability. Kawada is betting that while the mobile display waters may be choppy, suppliers that continue to provide products with excellent performance and offer their customers quality, support, and a long-term trusting relationship, will have plenty of good waves to ride.

-Gail Overton

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