Manufacturers of organic light-emitting diode (OLED) display devices are pushing hard on the production throttle even as potential customers raise the caution flag over the technology's adoption, costs, and performance.
Starting this month, the Netherlands' Royal Philips Electronics and Taiwan's RiTdisplay Corp. separately will begin mass producing OLED products and target them at applications in the communications and consumer electronics markets. Another Taiwan company, SK Corp., a joint venture between Eastman Kodak Co. and Sanyo Electric Co. Ltd., will begin production later this year.
Some OEMs and other industry observers are wondering if this step is a bit premature considering the challenges facing OLED displays. Reluctance toward adopting the technology is based on high costs, potential production snafus, and long-term quality problems, they said.
"OLED is a replacement technology for LCD, [and] buyers are cautious about adopting it until its problems get resolved," said Kim Allen, an analyst at Stanford Resources, the display research arm of iSuppli Corp., El Segundo, Calif.
Despite such reservations, some suppliers are moving ahead with their production plans, convinced that the electronics world is ready for OLED devices, notwithstanding the availability of proven display technologies. These companies said OEMs and EMS providers will be won over by OLED displays' thinness, light weight, high contrast, and wide-viewing angle, which can compete effectively with technologies such as LCDs.
"OLEDs are emissive, and everyone wants a bright, readable display," said Peter Hopper, chief executive of the Mobile Display Systems Group at Philips.
Its time will come
More than 50 companies are believed to be developing OLED displays, according to David Mentley, an analyst at Stanford Resources. These companies will initially scramble for shares in a tiny market due to factors such as OEM reluctance to switch from LCDs to OLEDs, at least until 2006 when OLED display sales are expected to finally break $1 billion, up from $112 million in 2002. By 2008, the market will have expanded to $2.3 billion, according to iSuppli. By comparison, market revenue for 4in. LCDs and below will grow to $11.6 billion by 2006, from about $7.5 billion in 2002, Mentley said.
But OLEDs should in time become the preferred display technology for small and portable electronics, said several speakers last month at the Society for Information Display Conference in Boston, because its emissive device structure yields better viewing characteristics than LCDs, which generally have a transmissive structure.
"It took 15 years for LCDs to overtake the CRT as the display for computers," said Stewart Hough, vice president of business development at Cambridge Display Technology, Pleasanton, Calif. Hough projects OLEDs will need less time to take over applications that LCDs now dominate.
Philips is beginning to ship passive-matrix monochrome OLED modules that use a polymer thin-film encapsulation process, and is claiming to have reduced material and component requirements over existing manufacturing processes. One design-in is an electric shaver that shows timing and display effectiveness, which Philips also begins shipping this month.
RiTdisplay is starting to produce a 2.67in. passive-matrix OLED display with 160 ?? 160-pixel resolution for PDAs and game-box applications, according to Bruce Lu, director of marketing at the company's Marketing and Sales division. The company has a joint technology and marketing agreement with DuPont Displays, Research Triangle Park, N.C.
On the active-matrix front, SK is slated to begin producing 2.2in. color displays for Sanyo cell phones in the fourth quarter and 2.16in. displays for Kodak cameras by the beginning of 2003, according to Scott Shatzel, Kodak's OLED materials business manager.
To promote design-ins, Kodak will also sell a $5,200 developers' kit containing the panel, OLED driver, and documentation starting in July, Shatzel added.
Philips, RiTdisplay, and DuPont also plan to make active-matrix color OLED displays next year. Barry Young, an analyst at DisplaySearch Inc., Austin, Texas, noted that OLEDs will better compete with LCDs in performance and power consumption when active-matrix color OLEDs, which have been more difficult to produce, finally become available later this year.
INot everyone impressed
Still, OEMs uncertain about OLEDs continue to use LCDs in their products. Sony Ericsson Mobile Communications of London, for instance, has chosen to use an LCD in its new T68i phone, according to a spokesperson who declined further comment.
Spokespersons at cell phone maker Nokia Corp. and personal communications device supplier Handspring Inc., Mountain View, Calif., said the companies have investigated OLEDs but so far have no plans to implement them.
To win over reluctant customers, OLED display suppliers must overcome production problems and bring prices down to LCD levels, said industry observers.
"There's lots of delays getting OLED manufacturing up and running," Stanford Resources' Allen said. "The main problems have been encapsulating the display and packaging the various components together into working order."
Long-term OLED display reliability also remains a concern. One issue, for instance, is differential aging of the display, which affects color quality. Some suppliers that have begun producing commercial OLEDs say they are resolving problems like this one.
"We expect our OLED displays to have lifetime expectations meeting the requirements of cell phones by 2003," said Peter Hopper, chief executive of the Mobile Display Systems Group at Philips.