From the second half of 2019, South Korean panel companies began to close LCD production lines one after another, and Samsung Suzhou factory was also sold to TCL. After more than 10 years of ups and downs, China’s panel industry has gradually stepped into the center of the world stage, with the share of LCD field as high as 50%. The dual pattern of TCL and BOE has also emerged.
When talking about the achievements of China’s panel industry today, many people will simply attribute it to “throwing money and fighting for scale”; there is no doubt that we have reverse investment and also played a scale effect. However, whether it is the initial “acquisition of production line” or the subsequent “independent construction”, the domestic panel industry has never stopped on the road of technology research and development. Moreover, it has gradually moved from technology introduction and step-by-step following to frontier exploration and partial leading.
At the “2020 global display ecology Conference (dtc2020)” on October 22, TCL Huaxing released four “world’s first” products, showing a “muscle” in the field of cutting-edge technology:
142 “igzo glass based active mled display is characterized by unlimited splicing, as many screens as you want, and more leisurely stage layout and conference display. 48 “8kin celltouchammini LED backlight curved car screen, integrated large screen, intelligent and more convenient, driving more interesting, which is also the highlight of Tesla.
6.7 “AMOLED cloud scroll screen, by pulling the mobile phone, you can make the screen size slide randomly, which can be large or small. When it is completely folded, it is only 4.5”, thinner than the traditional folding screen, realizing “putting the large screen into the trouser pocket”; 17 “printed OLED scroll screen, with better bending effect and low cost, not only accelerates the transformation of mobile phone screen, but also is expected to realize the application of larger size such as TV.
The name of each technology is very long, but the experience presented to consumers is two words: Zhenxiang. In fact, LCD technology has been developing steadily for more than ten years. The industry needs new drivers and consumers need more amazing experiences. It is time for a new round of revolution in the field of display. Whether China can lead the trend, where the technological change is going, and who can carry the banner, are the issues to be considered when pursuing new industrial opportunities.
1、 China can, too
In our daily life, 80% of information comes from vision. Therefore, display technology research and development has always been valued by enterprises, scientists and engineers all over the world.
CRT kinescope technology is the most widely used technology, which is simply to use the electron gun to shoot electrons to impact the phosphor to display. “Big square head” TV, computer display are its application. In the field of CRT, Japanese enterprises rely on the spirit of “keeping improving” to produce “more than ten times resistant” TV sets, and soon become the industry overlord. Sony’s “tellon” has sold more than 100 million units in the world, beating up its competitors.
In the 1970s, China began to introduce technology and research step by step, and finally achieved more than 90% localization of CRT industry chain. However, at the beginning of 2000, LCD TV came out gradually, and China’s CRT industry was eliminated as a whole.
LCD technology was invented by RCA company in the 1960s. However, due to the immature technology in the early stage, it is difficult to make large-scale products, so it has not been paid attention by American enterprises. It has been in a “desolate state” for a long time, and even thinks that “it is absurd to establish a LCD screen of TV screen size”. But Japanese companies are interested. They used liquid crystal technology in small digital watches, with great success, and then opened the way of liquid crystal TV.
In 1988, sharp successfully produced a 14 inch LCD TV sample, which ignited the accelerator of the industry. The first generation line, the second generation line and the third generation line were opened one after another. Subsequently, Korea, China, Taiwan and Chinese mainland joined the battle of LCD LCD, expanding the production dimension of LCD panel and optimizing the production process. There are also three reasons why Japanese companies are ahead of the US and finally win the LCD industry
“Learning network”, Japanese enterprises enter the market one after another and keep sharing in the competition, forming a knowledge network of experience and technology. “Industrial cluster”, Japan has also formed the upstream and downstream system, almost every link has the participation of enterprises, the glass substrate has Asahi nitzer, etc.; the lithography machine has Nikon, canon; the color film, polarizer has Dongdian, etc. “Open ecology”, IBM, Philips, Corning and so on are all important forces for the rise of LCD in Japan.
In contrast, the United States has a trend of independent innovation and closed system in the research and development of liquid crystal, and finally “thumping” almost died out in a secondary industry cycle. However, Japan’s leading position in the LCD industry does not mean once and for all.
In the selection of the 5th generation line around 2000, Japanese enterprises hesitated because of financial pressure and market prospect. Samsung, LG and other companies in South Korea, however, bucked the trend and increased their weight. They not only paid for factories, but also dug a large number of people from Japanese companies. Finally, in the query that Japanese companies ridiculed “Titanic”, South Korean enterprises ushered in the recovery of demand, quickly seized the market, and gradually increased investment to achieve the lead.
Therefore, in summary, the technological change and the shift of leading position of panel industry can be summarized as four points
In terms of strategy, it is necessary to be close to the demand, but a small step ahead of the demand market, and make layout ahead of time; in terms of mentality, it is necessary to widely adopt cooperation and cultivate upstream and downstream ecology; in terms of resource reserve, it is necessary to have talent reserve to realize technology research and development and process improvement; in terms of resource reserve, it is necessary to have talent reserve to realize technology research and development and process improvement; What’s more, there should be a virtuous cycle of “throwing money”. There should be not only sufficient capital, but also commercial profits to promote the long-term cycle.
In contrast, after more than ten years of development, the innovation strength of China’s panel industry has been greatly enhanced: it has accumulated good process experience and talent team; The industrial chain has also developed. In the upstream, there are San’an optoelectronics, Han’s laser, Shanshan shares, etc., which have made breakthroughs in the fields of materials and equipment. In the downstream, China is the largest market for mobile phones, TVs, laptops, and smart cars, and Chinese enterprises have become the backbone of the industry.
In terms of capital, due to the promotion of technology, the amount of capital invested in R & D and production line is also increasing. With the stability of LCD pattern, the industry profit is also improving, which is also conducive to TCL Huaxing and other leading companies in the industry to explore cutting-edge technology. In particular, under the impact of the epidemic, China’s supply chain will take the lead in recovering, which will also strengthen the attraction of cooperation with overseas enterprises.
For example, in June, TCL Huaxing invested 30 billion yen (about 2 billion yuan) in Japanese enterprise joled, which is a global leader in printing and display technology. The DTC conference of TCL Huaxing also ushered in the exchange of the chairman of Korea’s display technology innovation platform. From standing outside to learning, China’s panel industry has stepped onto the technology stage and built its own home show.
2、 Technology never sleeps
The original CRT technology has very fast dynamic response, but its disadvantages are also obvious. It needs a certain volume and thick glass. When the display area is more than 30 inches, it is close to 100 kg. Weight becomes an important obstacle to limit the display area. In the period of CRT evolution to LCD, PDP (plasma), fed (field emission) and other technologies are still advancing, but they are finally broken.
There are three reasons for LCD’s winning: first, it is the most “grounded” technology, which has been commercialized early with primary technology and started the spiral of “profit research and development”; second, digital watch has become a popular electronic product, which is obviously a scene that CRT can’t achieve; third, it is the most in line with the ultimate demand, and theoretically, it is easier to achieve lightweight and large size. In other words, although the road has twists and turns, it is bright in the end.
In the past decade, the LCD industry has also witnessed two improvements: one is the continuous improvement of generations and the continuous expansion of size; the other is the development of backlight. Looking back on the development of all technologies, no matter how different the terms are, the essence is the same, trying to meet the needs of consumers: from TV to computer, from mobile phone to wearable, from outdoor advertising to car control, the scene is more diversified, which also corresponds to the needs of power consumption, softness, size and thickness; and more authentic visual effects.
Therefore, to judge whether a technology has a better future is to judge whether it conforms to the consumption trend on the one hand, and the feasibility of commercialization on the other. At present, mled and ink-jet OLED are widely distributed in the industry.
Mled, including microled and miniled, uses LED display technology. LED is very common, such as street lights, billboards, etc., but the difficulty of mled is greatly increased, operating on the micron level. Microled refers to the microminiaturization of the traditional LED design structure, and the array of these micro chips into a display pixel that can be driven and controlled by a single driver. In this way, the display effect of high brightness, low energy consumption, high resolution and high saturation can be achieved.
In 2012, Sony released a 55 inch display with 6.22 million microleds to create high-resolution display pixels. Due to the removal of the sapphire substrate, microled is not easy to transfer, and the number of packaged chips per unit area has increased three or four times, which is easy to form false soldering, and the protection is more fragile, so the cost and difficulty are greatly increased. It is still in the incubation stage.
In order to balance technology, effect and business, miniled technology came into being. It also uses LED display, but the design size is two or three times larger than micro, the chip size is 100-200 microns, and the sapphire substrate is retained. Therefore, the process difficulty and production cost are greatly reduced. And it can achieve better effect than traditional LED, and its service life is longer than OLED.
Because of power consumption, size and other reasons, miniled is not suitable for wearable devices, but for large and medium-sized fields such as vehicle control, the effect is very good.
TCL Huaxing launched the world’s first 142 “igzo glass based active mled display screen, which is made of small size splicing, and can also form any size, realizing unlimited splicing and synchronization with imaginary space. It is suitable for diversified commercial display scenes such as office conference machine, command center, cinema, etc. The world’s first 48 “8kin celltouchammini led backlit curved car screen integrates the functions of instrument, center control and co driver entertainment. The touch technology of incell will bring consumers a more comfortable and smooth sense of control.
Apple, as a consumer electronics wind vane, recently announced that it is expected to add microled research and development in Taiwan, China, and its products will also take the lead in adopting miniled technology.
The principle of OLED is that the organic coating is powered on and self luminous, so there is no light source system such as light-emitting device, driving circuit and light guide plate, which greatly reduces the volume and power consumption. Moreover, through the optimization of materials, it can also achieve softness and folding. OLED mainly has two paths: evaporation and printing.
Evaporation type OLED, that is, by using electron beam or laser in vacuum, the luminous material is heated and evaporated, and finally condensed on the substrate. In the process of evaporation, a metal mask is needed to transfer the drawing to the substrate accurately. However, when the size is too large, the mask will be distorted to a certain extent under the action of gravity. For high-precision manufacturing, it will be very wrong, which will seriously affect the quality of products.
Moreover, the utilization rate of materials in the evaporation process is only about 70%, and the need for vacuum environment will cause the cost to rise. Therefore, evaporation OLED is also facing a commercial bottleneck in the large-scale link. At present, South Korea’s top two companies are in a leading position in this technology field. Samsung and LG have advantages in small and medium size and large size markets respectively.
Printing OLED, also known as inkjet printing (IJP), is similar to printing text on paper. Organic light-emitting materials are sprayed on the substrate and dried to form a light-emitting film.
Printed OLEDs can be produced under normal pressure without vacuum environment, and only about 2% of the solution will be wasted in the actual process, which greatly improves the utilization rate of materials. Compared with the evaporation process, it can be said that it is “leather easy to use”. The whole process is limited to a small scale. Therefore, for large-scale fields, printed OLEDs are cost-effective.
Although the printing principle is simple, the technical difficulty is not low. There is a long period of knowledge-how exploration from laboratory technology to industrial production. Just take the spray drop as an example, its size, viscosity, surface tension, speed, direction, inertia and other parameters need to be strictly controlled. If the viscosity is high, the ink will be blocked at the nozzle; if the viscosity is low, the ink is difficult to adhere to the substrate in an ideal situation, etc.
Although it is difficult, just like LCD replacing CRT, printed OLED has more commercial value in the field of large size considering the use of primary technology, production process, demand scenario and other factors. And printing technology, not only can be used for OLED, but also can be used for qled, is a general technology for a wider range, a breakthrough, many times. The cloud volume screen launched by TCL Huaxing based on OLED technology is quite unique.
Compared with the folding screen, the cloud scroll screen is pulled up from the front to the back. When the folding screen is closed, the thickness will double, the volume will increase significantly, and the consumer experience is general. But the thickness of the cloud scroll screen will not increase when it is put away, the area will decrease, and the portability will be improved. The world’s first 17 “printed OLED scroll screen is also made by ink-jet printing process, and through the top emitting device structure, the color gamut is as high as 100%, the display effect is more gorgeous, and the screen thickness is light and thin.
In the future, the development of OLED will move towards quantum dot technology, and after quantum dot technology, there will still be more new technologies. Technological change will never stop. What we need is a balance among business, technology and demand. This requires enterprises not only to be down-to-earth, but also to look up at the road.
3、 Flag bearer
In 2009, against the financial crisis, TCL LCD TV sales still doubled. At the same time, TCL Huaxing also officially launched its Shenzhen plant to build a leading 8.5 generation line in China. In the following ten years, it has started the research and development of multi technology routes. This year, under the epidemic situation, TCL Huaxing is still taking the initiative in technology, blowing the horn of exploration.
Looking back on the development of Japan, South Korea, Taiwan and other enterprises in the past technological changes, a good flag bearer should have outstanding ability in at least four areas: management efficiency, demand capture, technology reserve and industrial ecology. So can TCL Huaxing shoulder the banner of technology exploration?
Efficient management, for high-tech, heavy assets, long-term panel industry, is very important. It can improve the profit situation of enterprises, enhance the ability to resist risks and seize opportunities. The strategy adopted by TCL Huaxing is to build up a firm stronghold and attach importance to operation. In terms of project construction, we should make steady progress. Only after one or two years of mass production can we start the next project. Moreover, each project is not a simple capacity expansion, but also an iterative upgrade of new technology.
TCL Huaxing adopts the “Twin Star” strategy in its plant layout, with T1, T2; T6, T7 production lines in Shenzhen, and T3, T4 in Wuhan. This kind of layout can play an aggregation effect and improve the utilization of supporting resources. It is estimated that this strategy can save 900 million yuan in project cost and 600 million yuan in operation cost compared with projects of the same scale, and about 30 million yuan in supply chain collaboration.
In terms of business development, the company also decomposes its business strategy into annual business planning and implementation measures, and details them into each organization and each person. The company’s inventory turnover speed is leading in the industry, and the per capita expense rate (labor cost / operating income) has been at a low level in the industry for a long time.
Demand capture is an important skill for all enterprises to prevent the disconnection between products and market, and grasp business opportunities in advance. This is also more important for panel enterprises that need high capital per unit area of production line, especially the electronics industry which is constantly emerging in its downstream.
According to the public report, TCL Huaxing has business cooperation with all major color TV customers, including top international customers such as Samsung and Sony, as well as important suppliers of Xiaomi smart phones and Huawei smart screens. At the same time, relying on the integration advantage of TCL (Group) vertical industrial chain, TCL Huaxing can quickly obtain the preference of mainstream consumer market for each new technology.
In terms of technical reserves, TCL Huaxing also spared no effort. In 2019, R & D investment is 4.66 billion yuan, with a revenue ratio of 13.7%, which is not inferior to Huawei’s 15%. Huaxing’s R & D funds have been invested in various technological paths in an orderly manner. In the field of large size, the company has laid out printing OLED, qled, miniled and other technologies, and is also developing panel micro systems such as touch sensors. In the field of small size, the company has made breakthroughs in flexible screen, touch integrated, lightweight and other aspects.
In 2014, TCL Huaxing initiated the establishment of Guangdong Juhua printing and display technology Co., Ltd. Guangdong Juhua has carried out extensive cooperation with LGC of South Korea, Sumitomo chemical of Japan, Nissan Chemical and Kodak of the United States. The “national printing and flexible display innovation center” is also the only national innovation center in China’s display field, and has built the world’s most advanced printing and display public platform.
Huarui optoelectronics, a subsidiary of TCL technology, has developed more than 500 products in the field of luminescent materials. OLED materials have been supplied in batches, and the qled R & D team has solved the key problems such as the service life of red and green materials. The performance of self-developed blue light materials is leading in the world. The relevant research results have been published in the world’s top scientific journal Nature · communication, and the development progress is at the forefront of the industry.
A few months ago, Guangzhou has disclosed that TCL technology will invest in the construction of an 8.5-generation printing and display production line in Guangzhou. The vertical and horizontal cooperation in the field of printing and display has begun to be industrialized.
As of the first half of the year, TCL Huaxing has submitted 838 PCT international patent applications, with a total of 11895 applications. The number of open patents in the field of quantum dots is 1199, ranking the second in the world. In the field of microled, which Apple has bet heavily on, TCL Huaxing has 140 patents, ranking first in the world. With mature application and cutting-edge exploration, TCL Huaxing is stepping up its efforts in an orderly manner.
In the field of industrial ecology, TCL Huaxing also adheres to the concept of cooperation and opening up, expanding the “circle of friends”. We have established a joint laboratory with San’an optoelectronics, engaged in the development of micro LED display technology, and formed a technological process solution for the commercialization and mass production of micro LED; we have made strategic investment in Japan’s joled, accelerated the process of printing and display industrialization, and led the construction of a new global display industry ecology of upstream equipment, materials, devices and applications.
TCL’s investment and venture capital business is also distributed in the upstream fields, including nanocrystalline technology and Wuxi Tyco in the material field, as well as Cambrian, Jichuang north and Hongyou image in the chip field. In 2009, when TCL Huaxing was founded, Samsung was its shareholder. Including the speech made by Tsinghua Professor Zhang Baizhe at the conference, it shows that TCL Huaxing is building an industrial ecology with the combination of industry, University and research, and global opening and sharing.
As the saying goes, where there is a will, there is a way. To become a qualified flag bearer in the revolution, we need not only lofty goals, but also to form our own characteristics and advantages in the fields of management efficiency, demand capture, technology reserve and industrial ecology. Japan’s LCD revolution is like this, so is South Korea’s surpassing, and TCL China Star is ready.
Zhang Baizhe, a professor at Tsinghua University and an expert in the field of flat panel display, said that by 2025, China is expected to account for 71% of the global share in the field of LCD display, and this field will be the only one in China. This is a predictable achievement and a result worthy of celebration. However, it is not a result that can be achieved once and for all.
South Korean companies that quit LCD do not quit the panel field. On the contrary, they have made breakthroughs in the field of new generation display technology: for example, Samsung has strong strength in small-size OLED, accounting for more than 80% of the market share; and LG also takes the lead in the field of large-size white OLED. And one of Samsung’s secrets is to make a one-step bet and develop new technology.
It is not uncommon for China to rely on continuous R & D, from technological breakthrough to industrial success. For example, Huawei, which has been heavily suppressed by the United States, has achieved the technological brilliance of Chinese enterprises through the hard work of generations of R & D personnel in communication equipment and chip design. Chinese enterprises can also compete with technology.
And back to the panel industry, the LCD situation is really very difficult. The periodic shocks have put the industry and entrepreneurs through the test. Fortunately, we survived. Moreover, at present, there are no large-scale commercialized technologies and companies in the new generation of display technology, which is an opportunity for Chinese enterprises. Fortunately, TCL Huaxing and other companies have already shouldered the banner of technology exploration and stridded into a new round of display revolution.
Editor in charge: Tzh