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The European Display Market – Exciting Times for the Display Industry
Bob Raikes, Managing Director, Meko Ltd. (UK)
It’s interesting to get the chance to step back from the daily and weekly news from the display industry and look at the long term trends in the European market for displays. One of the significant trends has been the move of TV manufacturing into the countries of Central Europe, driven and encouraged by the relocation of LCD and PDP module making into those countries. High quality colour TFT LCDs used in TVs, computer monitors and notebook computers are made first by constructing a ‘cell’, a sandwich of a transistor array on one sheet of glass and a colour filter on another, with liquid crystal material in between. This cell is then fabricated into a ‘module’ that includes the backlight unit, polarisers, metalwork and electronics. The module is then built into a TV set with the addition of more metalwork, extra processing, a power supply, a remote control, a casing, loudspeakers etc.
In the days when CRT was the dominant TV display technology, more than half of the TVs sold in Europe were built in Turkey, even though they may have been sold under other brands. (Turkey has a special deal with the EU to eliminate the duty that is normally payable on TV import to the EU). Sets were also made in the UK, Spain, Italy, Germany and France.
However, if you are making the LCD or PDPs in Central Europe, it doesn’t make much sense to ship them to Turkey (or elsewhere) for assembly into sets. The increased logistics cost more than offsets any saving in labour costs.
Over the last year, the trend to assemble in the EU has developed and accelerated, so when we completed a store check recently, almost all the flat panel TVs were made in the EU, with only a very small number made in Asia (China and Japan) and the only products from Turkey being sold under brands owned by the Turkish makers (Finlux and Grundig are two of the brands). As a result of these changes, there is now a large TV set assembly business in the Czech Republic, Hungary, Poland and Slovakia and there have been reductions in set manufacturing in the other EU countries.
While module assembly has moved to Europe, historically all the cells have been made in Asia (Japan, Korea, Taiwan and China). However, one company, Videocon of Italy, has been looking at making LCDs in Europe. The company has a plan to build an LCD cell and module plant in Italy suitable for making 32" and 37" LCDs for TVs. The EU recently approved aid for this plant after a request from the Italian government, although difficult economic conditions at the moment may slow down the progress of the project.
The TFT LCD makers have taken over the notebook market, the desktop monitor market and now TV. The desktop monitor market in Europe has proved to be a tough one over the last few years. Computer buyers are increasingly looking to buy notebook PCs, and are not generally using these with separate monitors (even though there are good ergonomic reasons why they should). Furthermore, LCDs don’t get fuzzy as they age, although they do get dimmer. This can mean that replacement cycles are longer. As a result of these factors, there is little growth in the desktop monitor market in Western Europe although there are still growth opportunities in Central and Eastern Europe.
There is healthy growth in the notebook PC market, but the impact on the LCD display market is more limited in Europe as most notebook computers are imported from Asia (although Fujitsu Siemens makes many notebook PCs in Augsburg, Germany).
Digital signage is a growth area for LCD and PDP makers, although LCD is starting to dominate. In this market, the main opportunity for European businesses is in the integration systems. Although a lot of the displays come from Asia, in a digital signage application, there are opportunities for service, support, installation, mounting, special cabling and housings.
There is a large and growing business in the software and networking side of the digital signage application as well as in hardware. Meko’s forecasts for digital signage in Europe have lower growth than those for some markets such as the US and the main reason for this is that the market is so fragmented, which can mean much smaller scale projects over which to spread the development cost of the applications and content. This makes it harder to develop a business case for the use of digital signage. However, many factors are being improved and the market will take off very strongly in time.
Europe is making significant progress in developing OLED technology and in small, low power and flexible displays, especially when these factors come together in a single display! 2008 has proved to be a significant year for Microemissive Displays which has established mass production of its OLED displays for head mount displays in Dresden, Germany. The firm has shipped more than 100,000 displays now and is optimistic that its proof of production capability will allow it to attack high volume markets such as viewfinders.
Plastic Logic also is adding to the ‘display cluster’ effect in Dresden and is building a production facility in the city that is intended to be able to produce more than a million 10" (or equivalent) electronic paper displays in 2009. The displays will exploit the firm’s solution-processable polymer semiconductor technology.
Other European LCD technology companies that are also reaching production status are Nemoptic of France and ZBD of the UK, both of which have new ways of using existing LCD manufacturing technology to make zero power displays for point of sale and e-book applications. Both companies are moving into the industrialisation and mass production phase. Philips spin-out, Liquavista, has also won funding in March 2008 to support the move of its electrowetting technology which is also intended for low power and mobile applications.
These are exciting times in the European display industry!
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