QLED Conference: QLED vs. OLED Race Is On For Market Dominance
Ross Young, Display Supply Chain Consultants CEO
Organic Light Emitting Diode (OLED) televisions might be getting a lot of positive attention this year, but industry analysts from display market research organization Display Supply Chain Consultants (DSCC) said LED LCD TVs based on quantum dot enhanced technologies stand a good chance of winning the race toward market share and profitability in the near term.
Speaking at the QLED and HDR10 Summit sponsored by Insight Media and Samsung Electronics in Los Angeles last week, Ross Young and Bob O’Brien, co-founders of DSCC, offered their assessments of two key technologies in the high-end consumer television market — quantum dot-based LED (QLED) LCD TVs and organic light emitting diode (OLED) televisions, like those marketed in the U.S. this year by LG Electronics and Sony. The current assessment seems to be that QLED is advancing at a rapid pace toward scalability while large-format OLED displays face a long uphill slog in achieving panel yields large enough to move the needle on market share.
The world’s principal large-format OLED panel supplier LG.Display continues to increase yields and output every year, but compared to LCD displays it is still very small. In 2017, global OLED television sales are expected to account for less than 2 million units, which is a fraction the 223 million unit global television market.
“One of the real opportunities for QLEDs is that you can generate much higher pixels per inch (PPI) than OLEDs because you can use lithography instead of evaporation,” Young said. “That’s big when you are talking about 1,000 PPI or 2,000 PPI opportunities.”
“But if you want to decrease costs, inkjet printing could possibly be lower due to the increase in efficiency,” he said. “What we’ve seen is that the efficiency is competitive with solution processible materials today.”
Read more on the state of the quantum dot/OLED TV market after the jump:
Young said advances in high dynamic range (HDR) and wide color gamut (WCG) technologies are rapidly evolving through quantum dot enhancement films (QDEFs), quantum dot color filters (QDCFs) and electroluminescent quantum dot displays. Costs and eventually pricing of QLED televisions are coming down. This is unlike competing OLED technologies that remain hindered by low-yield production processes even as LG Electronics steps up marketing campaigns behind OLED TVs.
Because sales of very large panel televisions are growing, the key to success for both QLED and OLED TVs will be the development of new 10.5 Gen panel plants, which will produce large sheets of mother glass sufficient to be cut into more 65- and 75-77 inch screen sizes. Even new inkjet printing systems being developed now to make OLED production more efficient are not expected to outperform QLED production, DSCC research found. In fact, “OLED TV panel capacity is small and will remain small relative to LCD capacity through 2021,” Young said.
From a bottomline perspective, DSCC said OLED TV panels are not expected to be EBIT positive till 2019, which will be 2 years behind on 10.5 Gen LCD, “which will hurt competitiveness,” Young said.
He added that QDEFs and emerging quatum dot color filters have the potential for strong growth as volumes increase and costs fall.
Young said, “Quantum Dot Color Filters have greater opportunity to achieve mass market pricing quickly due to their ability to reduce power, increase brightness and improve viewing angles.”
Young observed that quantum dot displays could easily displace OLEDs at LED fabs, as manufacturers realize the technology’s potential for high performance and lower manufacturing costs.
For perspective, Young said that OLED panel supplies for large-format television displays hit just about 1 million units in 2016 and are forecast to come in south of 2 million units by the end of 2017. LG and other manufacturers are taking steps to ramp up production with new production techniques, including inkjet printing applications.
Although Young said LG expects positive EBITDA in 2017 and positive EBIT in 2019, OLED TV panel costs have a higher capex than LCDs, similar/higher material costs, and require a technology risk, all of which is limiting the number of large-format OLED panel entrants while keeping small the penetration of OLED televisions in the consumer marketplace.
In comparison, Young said Quantum Dot (QD) televisions using QD color filter (QDCF) panels can leverage existing amorphous silicon (a-Si) LCD, oxide LCD and low-temperature polycrystalline silicon (LTPS) LCD capacity. No changes are required to the backplane or the front plane.
Among the challenges are the weight of QDs and unintended illumination issues. As with OLED panels, Young said inkjet printing techniques can also be used but with lower PPI. Yet, advancing QD technology enables more than twice the brightness due to huge increases in optical efficiency, less filtering, and better viewing angles.
Further, the cost of producing QD panels potentially can be reduced through the reduction of LEDs, and the elimination of phosphor coatings to produce a wider color gamut. This, he said, brings “huge opportunities in TVs and on the desktop as well as in mobile LCD products due to power improvements and longer battery life.”
Young observed that QLED TV production, like OLEDs, may not be able to leverage a-Si LCD capacity. This will mean that less efficient oxide or LTPS TFTs will likely be required due to higher/more stable current capabilities.
“All prototypes we have heard of used either LTPS or oxide,” Young said. “Significantly less capacity, more capex and higher risk. – Using conventional lithography could enable higher PPI products than Vacuum Thermal Evaporation (VTE) OLEDs.”
Inkjet printing could lower the cost for OLED TVs. Efficiency is competitive for solution processible materials, but behind VTE deposited material, he said.
In OLED TVs, capacity is dramatically lower than it is for LCD due to the high cost of the back plane, the necessity of a color filter plus the added capex and material costs for the OLED front plane, Young pointed out. Meanwhile, the brightness and color volume performance is not as good and end-to-end profitability is worse.
While LCD manufacturers are racing to 10.5G plants, optimized for 65- and 75-inch screens, OLED manufacturers are struggling with their 10.5G technology decisions due to both front plane equipment and material technology issues. A decision has not been made by LG on which OLED deposition technology approach to follow.
At the same time, QLEDs can leverage OLED TV panel capacity, and OLED TV and mobile fabs could be converted to QLED fabs.
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All of this plays into what consumers want most. From the end-user’s perspective, Bob O’Brien, DSCC president, said pricing remains the most important factor in the television purchase decision and “consistently, not more than 8 percent of TVs purchased in the U.S. are over $1,000.”
The vast majority of televisions sold today are LED LCD TVs, but there isn’t a lot of elasticity left in the LCD TV panel market.
Meanwhile, 4K TVs are migrating down in screen size, and offered at mainstream price points. 4K incremental cost is nearing the threshold of ubiquity.
Similarly, O’Brien said the consumer electronics industry this year is “well along the path to achieving ubiquity with high dynamic range (HDR) in 4K televisions sets.”
Television manufacturers are rapidly evolving HDR and wide color gamut across model lines and price points, he added, with different levels of color and brightness capabilities determined by the television’s position in the good-better-best value arrangement.
The term HDR originated in photography and refers to a technique that heightens a picture’s contrast between the brightest whites and the darkest blacks. The higher the dynamic range, the closer a picture appears to match the color brightness and shading of real life. The better the HDR capability of a television the better the ability to see layers and shades of gray and to discern varying degrees of brightness.
Non-HDR televisions will display images that look more or less flat in brightness, with blooming white levels that washout fine details and layers that are virtually indistinguishable.
Although the consumer electronics industry has done a lot to educate the public to the benefits of new HDR displays, O’Brien said the studies show many people are still unclear about what HDR is and how it should perform. He said as many as 20 percent of recent television purchasers believe they have an HDR television set. Yet, Consumer Technology Association shipment data suggests the actual number is around 5 percent.
O’Brien said that if this uncertainty or appathy persists it could mean manufacturers will increasingly have to move toward the production of televisions with HDR and WCG features “in the least expensive way” in order to reach the most popular price points consumers will find attractive.
That could involve reducing the number of LEDs in the television’s LCD backlight system, resulting in lower peak brightness of 600 to 800 nits, and a wide color gamut of under 90 percent of DCI-P3 performed the most efficient way possible. Quantum dots applied in a film that is placed between the backlight and the LCD panel or in the LCD’s color filters would be likely solutions.
Today, HDR is a must-have feature for a 4K Ultra HD premium television, and over 90 percent of TVs that sell for more than $1,000 have HDR. It is increasingly becoming a must-have feature in a midrange set in the $500-$1,000 range.
As for non-HDR televisions, O’Brien said the opportunities are disappearing in all but smaller-screen sets.“You can sell a 60-inch UHD set that doesn’t have HDR today, but now you have to sell it for under $500,” O’Brien said.
So, the future of television sales seems to be headed toward mid-level brightness HDR for the mainstream and a handful of models with OLED and next-generation QLED technologies (or, perhaps, hybrids) among the small, though more profitable, premium end.
By Greg Tarr
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