Smartphone Panel Suppliers to Increase LTPS Capacity

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Smartphone panel market is set for another round of shakeout as expansion in LTPS capacity drives down prices

In the LTPS panel market, Japanese and South Korean suppliers currently have the edge in both shipments and technology. However, their lead will narrow as other panel makers expand their LTPS capacity. Fan said the slowdown in the smartphone market and the increase in the overall LTPS capacity will soon spark a price war that may result in another of shakeout in the panel market. The winners of this competition will be panel companies that can get their LTPS fabs to achieve high yield rates earlier than others, so they will also have an initial cost and pricing advantage. Having lower prices is crucial to dominating the oversupplied LTPS panel market since this advantage will further help secure relationships with clients and expand channels of consumption.

The share of FHD smartphones worldwide will continue to grow next year

HD resolution is now the prevailing display spec for entry-level smartphones and HD panel prices have touched the bottom. Therefore, the core display spec of mid-range and high-end smartphones has shifted to FHD. “FHD resolution will be higher than 400 PPI (pixels per inch), and LTPS is suited for the production of such panels,” said Fan. “Panel makers with LTPS fabs are thus potential suppliers of mid-range and high-end smartphone panels.”

Though LTPS panel suppliers are still relatively few, they have begun to cut their prices for their FHD products since the start of this year as to capture market share and strengthen relationships with clients. Late entrants to the LTPS market will face enormous challenges in staying profitable in the competition. At the same time, branded smartphone vendors will release more devices featuring FHD displays. By resolution specs, WitsView estimates that FHD models will account for 18% of the smartphone market this year, and this share will increase significantly to at least 25% in 2016.

Smartphone suppliers using technologies alternative to LTPS have also been quick to seize the opportunities coming from the rising demand for FHD smartphone displays. The various manufacturing technologies include a-Si (amorphous silicon) LCD, oxide TFT (thin-film transistor) LCD and AMOLED (active-matrix organic light-emitting diode). Samsung Display Corp. (SDC) has made steady progress in supplying AMOLED panels to customers outside of the Samsung brand this year and is expected to expand its effort in this area next year, squeezing the shares that LTPS panels have in the mid-range and high-end smartphone markets. More suppliers with different technologies also means that the price competition in the FHD smartphone panel market will intensify.

Narrow bezels and flexible panels will inspire new smartphone designs

Exterior design will be a major area of competition in next year’s smartphone market. Narrow bezel has emerged as a design trend in recent years, and the frames around smartphone screens are expected to become much thinner (with borders of some panel modules being less than 1mm). Another source of design innovation comes from AMOLED panels, which are light and thin as well as offering high color saturation. AMOLED panels moreover allows for the creation of flexible displays. Samsung’s Edge series, for example, has smartphones that features AMOLED displays that curve to the edges. On the whole, the market scale for flexible display design is expected to grow further next year.