Innovation in Global Industries U.S. Firms Competing in a New World (Collected Studies) (2008) / Chapter Skim
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4 Flat Panel Displays
4 Flat Panel Displays
Pages 141-162
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From page 141... ...
Since investment in manufacturing has been primarily in East Asia since 1990 -- first in Japan and then later in Korea and Taiwan -- one might also expect most innovative activity to be located there. In actuality, some important innovative activity is still located outside East Asia, primarily in supplier firms in the United States and Western Europe.
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From page 142... ...
; 10 million camcorders; 50 million MP3 players; and 85 million digital cameras. And yet, while TFT LCDs accounted for almost all notebook computer displays, camcorder viewfinders, PDA displays, and handheld TVs in 2005, they accounted for only around 60 percent of computer monitors and 10 percent of televisions. Until recently, most cell phones used Super Twisted Nematic (STN)
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From page 143... ...
. Even in those display markets where TFT LCDs competed with alternative technologies, growth rates were impressive.
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From page 144... ...
Most notebook computers had passive-matrix STN LCD displays until the price of TFT LCDs came down sufficiently to attract buyers. By the late 1990s, high-quality TFT LCD monitors for computers were being produced in high volume and prices had declined to the point where they were competitive in the marketplace with cathode ray tube (CRT)
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From page 145... ...
. flat panel-3.eps bitmap image began to produce TFT LCDs in high volume around 1995, the Taiwanese did not begin to do so until 1998.
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From page 146... ...
The technology for manufacturing TFT LCDs is quite complex, bearing many similarities to that for ICs. Both TFT LCD and IC production require advanced clean rooms, advanced lithography equipment, chemical or physical vapor deposition equipment, specialized testing equipment, and robotic handling equipment.
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From page 147... ...
In contrast, a significant portion of the global market for TFT LCDs tends to shift toward larger-sized displays (e.g., for computer monitors and TVs) while the demand for smaller displays (e.g., for cell phones)
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From page 148... ...
. Firm Strategies The strategy for manufacturers of TFT LCDs consists mainly of deciding if and when to invest in the construction of a new fabrication facility.
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From page 149... ...
During the bubble economy period in Japan, most Japanese firms were unable to invest in new plants. Instead they retrofitted their old plants to produce higher value-added products like low-temperature polysilicon TFT LCDs, which were mainly used for small displays such as those used in cell phones.
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From page 150... ...
occurs in both the design of new products and the refining of manufacturing processes. For example, as TFT LCDs started penetrating the market for televisions, panels had to be improved to meet the need for wider viewing angles than is necessary for displays in notebook and desktop computers.
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From page 151... ...
Between 2000 and 2005, the four major Taiwanese firms (AU Optronics, Chungwha Picture Tubes, Chi Mei Optoelectronics, and HannStar Display) successfully filed for LCD patents in the United States but the total patents granted were considerably fewer in number than those held by Japanese and Korean firms (see Figure 6)
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From page 152... ...
IBM Japan operated an important display laboratory in Yamato; Philips acquired the laboratories of Hosiden in Japan and then worked in collaboration with LG in Korea after the joint venture was established. Many members of the top management of Korean and Taiwanese firms were previously employed by U.S.
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From page 153... ...
All U.S. manufacturers of TFT LCDs other than IBM were relatively small, niche producers. These firms engaged in a variety of efforts to catch up with the Japanese leaders, some of which involved help from the U.S.
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From page 154... ...
. The alliance was to be structured as a 50/50 joint venture between Toshiba and IBM Japan.
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From page 155... ...
But in the early 1980s, managers in Corning Japan noted with some surprise that the laboratories of several major electronics groups were placing regular, gradually increasing orders for a more advanced product, Corning's 7059 fusion-formed borosilicate glass. Corning's proprietary fusion glass technology seemed uniquely matched to the apparent technological trajectory of TFT LCDs.
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From page 156... ...
Applied Materials/AKT Applied Materials, the U.S. semiconductor manufacturing equipment maker, started a display arm called Applied Display Technology in 1991.
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From page 157... ...
Despite the movement of manufacturing from Japan to Korea and Taiwan, development of 13 Applied Materials announced the joint venture's creation on June 17, 1993. According to Applied's 1999 Annual Report, the venture ended in 1998.
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From page 158... ...
The firm developed test, inspection, and repair systems for FPD manufacturing that were used to increase yield, reduce materials loss, get new designs from R&D into production, and assist in the rapid startup of new plants. For TFT LCDs, materials costs (for glass substrates, color filters, and polarizers, for example)
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From page 159... ...
Such pressures were generally resisted because the supplier firms wanted to maintain the core of scientific and engineering expertise closer to home. Corning experimented with a joint venture with Samsung that proved successful but the joint venture licensed fusion glass technology from Corning and was not permitted to compete with the parent firm in other markets.
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From page 160... ...
This need to collaborate provided some U.S. supplier firms with opportunities to remain at the technological frontier even though no U.S.-owned firms were manufacturing TFT LCDs after the year 2001.
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From page 161... ...
. Technonationalism and cooperation in a globalizing industry: The case of flat panel displays.
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From page 162... ...
. The Transition to TFT LCD Could Cut Down Prices on Cell Phones.
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