Display Wars Heat Up Amid 3D TV Boom

Samsung Electronics and LG Electronics, the world's two-biggest makers of flat-screen television sets, are in a head-to-head competition for leadership in the next-generation flat-screen market, analysts and company representatives said Monday. The competition comes at a time when once cash-troubled overseas rivals are making inroads to develop the next display market as consumers shift to higher quality and better imaging products.

With an astounding amount of buzz in the electronics world, and the movie Avatar breaking box office records, television makers and cable companies are pushing hard to deliver 3D to living rooms. The world's top flat-screen producer Samsung Electronics will release its first three dimensional (3D) TVs next month, while LG Electronics will make offer its 3D LED-backlit LCD TVs.

Samsung is moving quickly into the market that some analysts say will take about "10 years to reach critical mass," which is about how long it took high-definition televisions to reach more than half of the U.S. population. Yoon Boo-keun, the chief of Samsung's visual display division, which is in charge of the company's TV business, said last week that the company has revised up this year's 3D TV sales target to 2.6 million from 2 million.

LG Electronics' chief technology officer (CTO) Paik Woo-hyun stressed that the company will become the world's biggest maker of 3D TVs in 2011, selling 3.4 million.

For Samsung and LG, content and their relationships with Hollywood are set to be a critical element in their marketing. The companies are also set to start rolling out new content networks that will deliver music and movies for PAVV- or Infinia-branded TVs.

"As 3D TVs are in their initial stages of mass marketing, it is expected Samsung and LG to heavily spend on advertising," said an LG Electronics representative.

Besides Samsung and LG, leading Japanese TV players Sony and Panasonic are heavily betting on 3D TV businesses with a firm belief over their edge in content.

With entry by other TV manufacturers, the market for 3D displays is also growing rapidly. According to the data from DisplaySearch, the market size for 3D panels will be valued at $22 billion by 2018, up from $900 million in 2008 with an annual growth rate of 38 percent.

Consumers still need to wear funny 3D glasses and some say 3D TVs will be "for the early adopters" in their current configuration.

"But for some people it could be a good excuse to put their current HDTV in the bedroom and put the new 3D TV in the family room," said the LG Electronics representative.

With 3D TVs being the "next big thing" just around the corner, the world's leading panel makers in South Korea, Japan and Taiwan are now involved in fiercer competition to get a bigger share of the 3D panel segment. Currently, Samsung leads followed by LG Display, and Taiwan's AUO and CMO. The brighter "long term outlook" is also making flat-screen panel majors maintain full production capacity.

LG Display, which is a flat-screen affiliate of LG Electronics, clarified it will overtake competitors in terms of 3D panel shipments and 3D-related technology.

"We have a competitive edge in 3D displays, though LG Group had been troubled in the LED-backlit LCD TV market, last year," LG Display CEO Kwon Young-soo said, adding steady interest and increasing demand for 3D TVs was cutting possible "oversupply worries" in the global panel industry.

The industry leader Samsung has been churning out six 3D TV-only panels for 40-, 46-, 55-inch flat-TVs based on active-glasses.

"That's the new market. It is expected there will be fiercer competition between TV and even panel makers. But Samsung will expand panel shipments for 3D LED-backlit LCD TVs and 3D LCD TVs," Chang Won-kie, president of Samsung's LCD business, said.

Taiwan's AU Optronics (AUO) is planning to officially launch 3D TVs in the second half of this year and the total shipment for this year may reach one million, analysts say.

Since the second quarter of last year, the global flat-panel industry has been healthy as economic recovery signs are making general consumers either upgrade TVs or buy additional ones.

"3D TVs will help the screen industry continue the momentum after LED-backlit LCD TVs, last year. 3D TVs will spur replacement demand in developed markets, where the flat-panel display market is very near in saturation," Kim Sung-in, a senior analyst at local brokerage Kium Securities, said.

"That will be good for screen producers but means more competition," according to the analyst.

The "display competition" is also being seen in the mobile segment.

Samsung Mobile Display, a joint venture with Samsung Electronics in the next-generation AM OLED panel screens, said it has developed a so-called "Super AM OLED panel" that will be used in mobile phones. The latest screen offers an enhanced image from the existing AM OLED panel with the picture quality of WVGA (800X480) level, Samsung said.

As a defensive measure, LG Display will start construction of a new OLED manufacturing line that will use 3.5 generation processing technology in its LCD cluster in Paju, Gyeonggi Province, sometime in the third quarter of this month.

"As we said earlier, LG Display will put more focus on AM OLED panels due to higher consumer appetite for advanced products," an LG Display spokesman said.

An OLED panel provides a better picture image than the conventional LCD or even plasma screens. The panel also has edges in energy consumption and contrast ratios. In the OLED TV market, LG seems to be going one-step further than its rival Samsung Electronics. LG, which released a prototype 15-inch OLED TV late last year, is planning to introduce a 30-inch model, the spokesman said.

By Kim Yoo-chul, The Korea Times