Korea, leading innovator in flat-panel market

Korea is eyeing the No. 1 position in the global display sector, one of the 10 government-designated next-generation growth engines, taking advantage of the country's firm grip on the flat-panel display market.

So-called next-generation flat-screen displays refer to thin-film transistor liquid crystal displays, plasma display panels and organic electro luminescence panels.

Currently Korean manufacturers dominate the world's TFT-LCD market, though competition has stiffened as Taiwan and Japan are working to snatch some of the business away from Korea.

Samsung Electronics and LG Electronics are spearheading innovation in PDP and organic EL technologies, which are respectively used for producing high-end digital TVs and mobile phones. In addition, Samsung SDI and LG.Philips LCD Co. are bolstering the country's competitiveness in the display manufacturing industry.

The global display market, which is estimated at $61.6 billion this year, is expected to grow to $90.6 billion in 2007 and $140 billion in 2012.

It is widely agreed that Korea's display industry has great potential due largely to the growth of related industries - digital TV, computers and mobile phones. Experts pointed out that Korea's leading display makers should focus on developing core technologies and parts to strengthen their market dominance.

In this regard, it is encouraging that Samsung SDI, Korea's leading display manufacturer, developed a state-of-the-art display panel for mobile handsets, which it claims features the world's fastest movie-clip display capability.

The UFS-LCD, meaning ultra-fine high-speed liquid crystal display, sports a 13.5-millisecond response time, which is about two to three times faster than the response times of TFT-LCDs.

The company said it would capture premium-quality handset buyers with its UFS-LCD and organic EL panels, while targeting the low- and medium-priced mobile handset market with existing models such as the STN-LCD and the UFB-LCD.

The launch of the UFS-LCD will rapidly change the LCD market for high-end multimedia mobile applications, which has so far been dominated by Seiko Epson and Sharp of Japan, Samsung SDI forecast.

Samsung's focus on flat panels

Samsung Electronics recently began mass production of TFT-LCDs at its Chinese plant to tap into the fast-expanding Chinese market.

The world's leading flat panel display maker launched the construction of the production line in Suzhou last October with a total investment of 63.4 billion won ($53.6 million). The production line was completed in May.

The company said it has successfully test-operated the factory to make sure that the production line can serve as its manufacturing platform for the vast Chinese market.

Samsung said that the plant will produce about 100,000 LCDs this year, but from next year, it will jack the production up to 8 million units, equivalent to 30 percent of the company's total output.

Samsung, which exports about 90 percent of its TFT-LCD output, said that with the help of the local plant in China, it is now expecting to sharpen its competitive edge in the Chinese market.

Samsung predicted that the Chinese market would reach 34 million units next year, accounting for about 30 percent of the global LCD market. Indeed, the market has been expanding at an annual growth rate of 52 percent, the company noted.

In April, LG.Philips LCD, Samsung's archrival, completed its production line for TFT-LCD modules in Nanjing, signaling fierce competition ahead to capture the vast Chinese market.

In fact, Samsung is betting that its huge investment in flat panels will pay off. Samsung said it would build a large-scale TFT-LCD industrial complex in Asan, South Chungcheong Province, a move that is expected to further boost the electronics giant's competitiveness in this fast growing market segment.

The company said it would invest about 20 trillion won ($16.8 billion) through 2010 to construct the seventh-generation production line in Asan, which will be twice as productive as its sixth-generation TFT-LCD facilities.

The construction of the factory, to spread over 610,000 pyeong (2 square kilometers) of land in Asan's Tangjeong area, will be finished in the first half of next year. Equipment will then be installed beginning in the second half to allow mass production starting as early as 2005.

"The seventh-generation LCD production line is of the '2-meter-level mother glass generation,' which can produce screen sizes of 1.87 meters by 2.2 meters," the company explained. Samsung approved the seventh-generation project in May.

Production-wise, the new manufacturing lines are said to be three times faster than the fifth-generation ones and twice the speed of the sixth-generation facilities. Accordingly, the company will be able to make more than 700,000 32-inch LCD screens per month, it said.

With the increased production, Samsung said it would push up its global market share for TFT-LCDs to 24 percent by next year, when all of the fifth-generation lines will be operating, and 25 percent by 2005 when the seventh-generation factory is in place.

"We forecast the industrial complex will create jobs for about 10,000 people and post annual revenue of over 10 trillion won after 2010, thus making the park one of the nation's more representative high-tech industrial facilities," a Samsung executive said.

600450 Korea, leading innovator in flat-panel market glassonweb.com

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