Korea's Display Strives for Yesterday Glory
Korea's Display Strives for Yesterday Glory
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  • 승인 2006.08.01 12:01
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Overview Focus on * Price Competitiveness * Boosting R&D * Equipment Localization Korea held the No. 1 position for four years in the World LCD industry field. But recently, due to aggressive competition from rivals like Japan and Taiwan whose display development technology levels are on par with ours, the position is continuously unstable, with China now also threatening Korea's reputation. To retain our position in the field, we have to focus on localizing the key components for display panel and pay efforts to upgrade our core display technologies. What is the global outlook for leading display-producing countries Korea must strive to overcome the present difficulties. To break that deadlock, raising competitiveness through collaboration is essential. In the case of Japan who already has taken over the valued No. 1 LCD industry position held by Korea, the country began to attack technology development with determination to retake the LCD powerhouse's reputation by teaming up with 20 LCD companies such as Sharp & Hitachi, etc. Taiwan also has been supporting TFT LCD as one of the three main high-tech industries that were propelled by the government. In similar vein the government provides associated business circles with building sites free of charge, reduces those kinds of companies' corporate tax and supports training courses for professionals. For China, the government began to put much emphasis on OLED as a top project among some Next Generation Display Industry Projects and has been providing favorable support as much as it possibly can. Recognizing the importance of the display industry, the Korean government has been promoting 'The New Growth Engine Display Center' and has been fulfilling its frontier projects since early on, in a bid to strengthen the country's competitiveness in the world market. But nevertheless, cooperation between divisions is rarely performed. Souk Jun-hyung, executive vice president of Samsung Electronics, who developed 40 inch LCD panel initially in the world, flatly commented that the standard of Korea's LCD technology could not catch up Japan's level and also Korea still lags behind some other advanced countries in terms of basic component manufacturing techniques. Japan's display core technology is worth 100 points and Korea only 90 points out of 100, according to his evaluation, Thanks to Japanese people's artisan spirit, which is usually illustrated as stubborn adherence to its principles and patient devotion to develop its own display technology, Japan is rapidly advancing its own core technology. But in terms of a commercialization technique, Korea and Japan are now neck and neck in the world market. However some people are holding a different view about Japan's pre-principle attitude since it could hamper its own development. In similar vein, Samsung Electronics, Korea's most prominent display company, credits its success to its efficiency and creativeness. Is Korea really ready to go into combat in the global market Currently, Korea has to compete with other countries due to the overcapacity in the display industry, which has led to pricing competition. It is hard to anticipate the outcome of this big match, because Japan, Taiwan and China, the rivals, are running neck and neck at present. Especially, Souk praised Taiwan, as it has been a success story in that field and Souk assessed that Taiwan is likely to get 80 points out of 100 in core technology and deserves to get 85 points out of 100 in commercializing techniques. Commenting about Taiwan's low interest rates and wages and ardent support from the government, he expressed a yearning for matching Taiwan's LCD manufacturing system. In Taiwan, six LCD companies receive their components from only one supplier, which are needed for LCD panel assembly. Thanks to this system, Taiwan didn't suffer any problem to lower components' costs and to nurture domestic companies. We have to make those kinds of manufacturing system as a model for the domestic system. But under the current situation, setting aside favorable cooperation between domestic companies, they do not even want to share components that are needed to manufacture LCD Panel due to their exclusiveness. Actually, Korea's self-reliance level in the components industry is not so high. To complete all assembly processes, the role of seven key components is very important. And those key components account for 80% of hundreds components that are needed for LCD panels. But Some Japanese and American companies monopolize the polarizer & optical film manufacturing. Where are the Korean display industry's stepping-stones Technically, the characters of the components & material industries are very different from any other IT merchandizing field. If there is no support from the government and major companies, no remarkable advances can be expected. Most of all, long-term policies for nurturing components and material companies are required. If Japan, the big rival in display LCD shipments, someday announces that they will stop exports of all display components, Korea's LCD industry would be paralyzed. Some people are consistently calling for breaking the rigid and vertical supply systems such as Samsung Electronics' 'Supporting Star Association' and LG Philips. LCD's Friends Club etc. But other experts are opposed to this, as the conservative and exclusive system has been acting as a means to protect Korea's own components companies. However, more and more experts are trying to break the safety net as part of an effort to develop domestic SMEs' competitiveness. These days domestic companies are struggling to gain a foothold in the global OLED market. They are striving for core equipment and manufacturing techniques and steadily trying to produce largesized OLED panels of the future-oriented over 4Gtype. University laboratories inventions have lately been put to practical use. The OLED materials industry requires high standard techniques to reinvigorate its effectiveness, durability and brightness. Domestic companies have a strong willingness to make inroads into the OLED industry and have been trying to secure capital for further investment. As time goes by, the gap between Korea and advanced display countries has narrowed, and also the burden of costs shrank. However, to promote Korea's technical take-off, first of all relevant companies must try to settle the pending questions such as durable & panel oversize techniques. We should not cease our developments and researches for a brighter future for the industry. For example, AM OLED (Active Matrix OLED) called: "A Dream of the Next Generation" is almost 1,000 times faster in terms of response velocity, etc., than LCD which has made Korea an IT powerhouse. Thanks to AM OLED's superiority in reaction velocity, thickness, color, style, field of vision and electricity consumption etc, unlike LCD it can emit light for itself even without backlight. So it can be said that new generation OLED has great merits in weight and thickness. The technology will be adopted in various items such as cellular phones, DMB phones, WiBro phones, PDAs, PMPs, etc. Already many global companies are plunging into the cutting-edge display industry. Samsung Electronics, LG Philips and Samsung SDI in Korea also took part in the big match round. What should be the beacon for Korea's "display ship" Fortunately, Korea's advanced display technology is highly evaluated in the world. And Korea has been attracting display experts' attention worldwide, since they consider Korea as a kind of test-bed for OLED. Similarly, Samsung SDI and LG Philips LCD announced recently their ambitious projects regarding mass productions of AM OLED at the latter half of the year and the first half of next year. If these companies make a great coup in the industry, this accomplishment will serve as a stepping stone for Korea's success in the display industry's future and apparently this will be a golden opportunity to domestic OLED components and equipments companies since no one wants to rely on foreign companies abroad for components and materials like now. But despite the companies' strenuous efforts to raise their competitiveness in the world market, the government's policy doesn't seem to show any signs of keeping pace with businesses' development and furthermore even seems to be slackening its pace. For example, our big rival, Taiwan has been giving exemption from corporate tax for display companies, and they are receiving plant sites gratis, plus other benefits. But as for Korea, the government just exempts tax for the shares of foreign investment and only exempts tax for those who buy the plant sites for themselves. Clearly, specific and adaptable long-term policies are required for Korea's display industries and also Korea should carefully examine regulations to decide whether they hamper the development of Korea industry or not.

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