LCD vs. OLED new technology

In our daily lives, liquid crystal screens (LCD) have always been the preferred display panels for consumer electronic products such as TVs, computers, tablets, and mobile phones. However, currently, a new display technology is quietly emerging and is welcomed by new models of major smart phone brands. OLED displays are used in smart phones of Samsung's dual flagship S/Note series, iPhone X, Xiaomi 10, Huawei P40 and other brand models.

OLED display panels can self-illuminate when energized, and are light and thin, high in brightness, low in energy consumption, and can be bent. They are widely sought after for a while. In contrast, the LCD screen itself does not emit light, and an important component "backlight display module" is needed to present images. In view of this, will liquid crystal displays be eliminated by OLED technology soon?

From a global perspective, the demand for LCD panels is still growing. IHS Markit data shows that in 2018, the global LCD panel shipment area reached 199 million square meters, an increase of 9.94% over the previous year, especially in the large-size field. Before 2010, my country's large-size LCD panels were all dependent on imports, and now they account for nearly 50% of global production capacity.

China has now become a major producer and consumer of consumer electronics products such as LCD TVs, computers, and smart phones. The LCD panel display industry, as its key supporting industry, is also accelerating its transfer to the country. From 2013 to 2018, China's LCD panel production capacity gradually stabilized after a period of rapid growth of about 30% for 3 years. It is estimated that by 2023, the total LCD panel production capacity in Mainland China will account for 55% of the total global production capacity.

Although OLED panels have superior performance, foreign capital monopolization in the upstream production links is serious, which brings challenges to their promotion in the Chinese market.

First, the high-end vapor deposition machine necessary for the production of OLED panels is monopolized by Japanese company Cannon Tokki. Due to the limited production capacity of Cannon Tokki, it has absolute advantages in technology, and the yield rate of OLED panels using other evaporation machine production lines needs to be improved. In addition, domestic OLED panel manufacturers rely heavily on overseas purchases for organic light-emitting materials required in the upstream.

The upstream of the industry chain is "stuck", resulting in the OLED production line investment cost more than twice that of the LCD production line, and the high depreciation and amortization caused by this restricts the increase in enterprise production capacity.

The main area where OLED replaces LCD is the smart phone display. However, in terms of cost, LCD displays still have obvious advantages. Due to the difference in production costs, the average price of a 25.5-inch LCD smartphone panel is US$15, while the average price of an OLED smartphone panel of the same size is as high as US$25. The price advantage of LCD products is obvious.

In addition, according to IDC statistics, global mid-to-low-end mobile phone shipments account for more than 80%. Due to price restrictions, the proportion of LCD screens is 80.56%; the penetration rate of OLED screens is low, mainly used in the flagships of major brands Models have limited impact on the overall mobile phone market.

At present, unless the cost of OLED screens is rapidly reduced, liquid crystal displays will continue to go hand in hand with OLED technology for a long time, and will have more advantages in cost and production scale. Among them, in the mobile phone market, LCD and OLED technologies coexist; in the professional display market, LCD technology is the dominant one.