Core history - an overview of the development process of the semiconductor industry at home and abroad, excavating industry anecdotes, learning from the past and the present, and exploring the way of future development of the industry.
Jiwei Network reported that looking back at the development history of the global panel industry, it has gone through the process of the origin of the United States - the development of Japan - the catch-up of South Korea - the rise of Taiwan - the Chinese mainland force. It is undeniable that Japan has added several strokes in this history, from accounting for up to 94% of the global panel market to now only A "single seedling" of JDI, the current situation of the Japanese panel industry "ups and downs" is inevitably regrettable.
The original "king" of the panel industry
The glory of Japan's panel industry also begins with the birth of liquid crystal display panels (LCD). In 1960, George Heilmeier, who worked part-time at the Radio Corporation of America (RCA), discovered a new electro-optical property of liquid crystal materials, and after 8 years of intensive research, the world's first LCD came out. However, RCA disappeared after showing the LCD flat-screen TV, and American companies such as Motorola, AT&T, and HP also lost in the face of huge capital investment and a long research and development cycle, and successively withdrew from the panel field.
At the time when American companies gave up LCD, Japanese companies chose to enter the game, and Suwa Seiko and Sharp were the pioneers of two "head irons", which bought LCD technology from RCA and American Ferguson in 1972, respectively, and took an unusual path from micro-LCD.
Among them, Suha Seiko launched the world's first LCD gold version watch that can display 6 digits in 1973, and 10 years later, it developed a thin-film transistor liquid crystal display (TFT-LCD) TV, which also attracted Panasonic, Toshiba, Hitachi and many other established Japanese electrical companies to participate in TFT-LCD research and development.
Picture: Suwa Seiko LCD gold edition watch
Sharp used the LCD for a calculator in 1973 and began to catch up with seiko TFT-LCD TVs. In 1987, Sharp managed to bring the 3-inch LCD TV into production, but the output was not satisfactory. Until the following year with the world's first 14-inch TFT-LCD fame shock, and then began to try to mass-produce large-size TFT-LCD possibilities, after 5 consecutive years of money and losses, finally increased the yield from 8% to 80%.
At the same time, more companies in Japan are trying to set up panel production lines. For example, IBM Japan and Toshiba established the DTI Manufacturing Alliance in August 1989 and jointly invested more than $100 million to build a TFT-LCD mass production line; in August of the following year, NEC also announced the entry of the company. Data show that between 1991 and 1996, at least 25 high-volume panel production lines were built around the world, of which 21 were built in Japan.
With the participation of more enterprises, Japan has established a complete industrial chain system from raw material supply, equipment assembly, to production and manufacturing, and process specifications. It is worth mentioning that in 1994, Japan's share of the global panel industry jumped to 94%, and Sharp was even more beautiful, known as the "father of liquid crystal", and even held pricing power for a long time.
Tragically "attacked" by the United States and South Korea
When Japan monopolized 95% of the global panel industry market share, the United States accounted for less than 3%, which naturally caused dissatisfaction in the United States. So in the early 1990s, the United States imposed anti-dumping lawsuits against Japanese flat panel display manufacturers and raised tariffs on TFT-LCD in an attempt to suppress Japan. On the other hand, South Korea has also become a strong challenger in the panel industry in Japan, Samsung, LG and other companies began TFT-LCD research and development and trial production around 1990, despite years of continuous losses, has also insisted on investing in research and development and process improvement, and finally in 1995 to achieve large-scale mass production of LCD panels.
In order to seize the market, Japan and South Korea have launched fierce competition. Around 1997, under the multiple blows of the Asian financial crisis, the trough of the panel industry and the "suppression" of the United States, most of the Japanese panel manufacturers faced the dilemma of loss. In contrast, Korean companies such as Samsung and LG have adopted a counter-cyclical investment strategy, regardless of the immediate losses, and decisively invested heavily in expanding the production line. Samsung has directly set up its factory in Japan and hired unemployed Japanese panel engineers. Such an aggressive strategy allowed Korean companies to eat up most of the market share of Japanese companies when the industry picked up.
However, Japan, which has a sophisticated technology, has not given up on this, and it has set its sights on Taiwan, which was the least affected by the financial crisis in Asia at that time, and signed a TFT-LCD technology transfer contract with a local partner, making up for Japan's lack of production capacity and obtaining a large number of patent transfer fees. This move also laid the foundation for Taiwan's ability to compete with it in the future.
Time came to 1999, this year for the Japanese panel industry is the "darkest moment", Samsung with 18.8% of the share of the global flat panel display market topped the list, LG reached 16.2%, ranking second, surpassing Sharp who has dominated the list for many years. At the same time, major companies have also begun to cooperate with Korean companies. In May of the same year, Philips exchanged $1.6 billion for a 50% stake in the LG panel business; in July, Apple invested $100 million in the Samsung panel business; and in October, Samsung received a contract from Dell for a large TFT-LCD order worth $8.5 billion.
Today, South Korea's Samsung and LG also occupy a high position in the global panel industry, and have already surpassed the Japanese panel industry such as JDI in terms of technology and market share.
Only one "single seedling" of JDI remains
In the process of industrial development, some people are out, and some people are rising, which is an eternal law. This is especially true for the panel industry with a long technology research and development cycle and intensive funds. Suwa Seiko, NEC and other companies are the representatives of the exit, and Sharp's acquisition by Hon Hai has become a sign of the decline of the Japanese panel industry.
One of the pioneers of the Japanese panel industry, Suwa Seiko, after investing a lot of money to establish factories, configure equipment, and establish production processes, was unable to cope with Japan's economic crisis in 1989, and the huge capital investment in the early stage made it have to work hard to repay loans and finally withdrew from the panel market.
After Sharp dominated the world in 2001-2007 with LCD TV, due to external reasons such as the global financial crisis, the appreciation of the yen and its own business reasons, the performance began to decline for many years from 2008. Measures such as layoffs and the closure of some panel production lines also failed to reverse the situation, and since then it has begun to seek external financial support to get out of the business difficulties. In 2016, Hon Hai acquired a 66% stake in Sharp for 388.8 billion yen, which has become a sign of the increasing depression of the Japanese panel industry.
Another Japanese company, NEC, also closed its Kagoshima LCD panel factory in 2009; two years later, NEC sold 70% of its shares in the company that produces small and medium-sized LCD panels to the Shenzhen Tianma Group, a Chinese mainland, and has since withdrawn from LCD panel manufacturing.
However, the remaining Japanese companies have not given up since then. In 2011, led by the Japanese government, Toshiba, Sony, and Hitachi integrated their LCD panel businesses and established Japan Display Inc, JDI, which became the only company in the Japanese panel industry with manufacturing capabilities.
In fact, JDI was also brilliant in the early days of its establishment, supplying Apple LCD screens in the iPhone 7 and 7 Plus era, and Chinese mainland flagship mobile phones of Huawei, Xiaomi and other manufacturers also used JDI screens. However, the good times are not long, JDI did not keep up with the trend of the panel focus from LCD to OLED, and began to fall into the dilemma of consecutive years of losses, performance fraud, panel factory shutdowns, expanded layoffs, and resignation of the president in 2019. Although JDI has now entered the OLED field, it has lagged behind in the beginning, and has been left behind by Korean companies such as Samsung and LG and Chinese mainland panel manufacturers such as BOE.
Conclusion: The secret of the success of the Japanese panel industry lies in the development of the application market from the micro LCD and the resilience of not being afraid of failure, but after experiencing the catching up of South Korea in different periods, the short-term glory of Taiwan and the power of the Chinese mainland, it is increasingly depressed, and now only JDI is left, which represents the "single seedling" of the Japanese panel industry.
(Proofreading/Kapok)