Mighty Samsung Electronics posted a net loss of $14.55M in Q4′08, and somewhat less mighty AUO swallowed hard and announced a net loss of more than $774M, with CMO not far behind. AUO expects large-size LCD panel shipments to drop by 15 to 20% in Q1′09, and small/medium panel shipments to drop by 30%. TFT-LCD polarizer revenues are expected to fall by about one percent in 2009. Sony has warned of a record operating loss, and LG Electronics posted it’s worst-ever quarter in Q4′08. LG Display also posted a loss for Q4, which was due mostly to the $400M anti-trust fine levied by a U.S. court.

Ken Werner
Senior Analyst and Editor

We need to cheer ourselves up. Are there any crumbs of good news to be found? Yes, a few. Demand is increasing in China for LCD-TV modules and prices are stabilizing as a result.

Large public information and advertising displays are expected to grow 45% according to DisplaySearch, and global LED revenues are expected to grow 2.9% in 2009 according to iSuppli.

So let’s talk about LEDs in relation to displays. At CES, most major LCD-TV manufacturers were showing sets with LED backlighting. A few were products; many more were scheduled to be available later this year. The pace of this LED backlight roll-out is faster than many people expected, and there are a few reasons for this.

First, for the most part, the industry is focusing on backlight units (BLUs) based on white LEDs (W-LEDs), rather than BLUs using red, green, and blue (RGB) LEDs. RGB LED BLUs provide dramatically higher color gamuts than W-LEDs but they are expensive. W-LEDs provide color gamuts that are roughly the same as conventional cold-cathode-fluorescent-lamp (CCFL) backlights, and are energy-efficient, long-lived, capable of being built into very slim cabinets, and are dropping rapidly in price. Both W-LED and RGB LEDs do not contain mercury, which is a component of the gas mixture inside CCFLs.

Direct W-LED BLUs are becoming affordable for mainstream LCD-TVs. Direct LED BLUs have an array of LEDs — often a couple of thousand of them — across the entire surface of the backlight to illuminate the LCD directly. Because these LEDs can be dimmed in sections (local area dimming), they can greatly enhance the contrast ratio of the LCD panels in front of them, and save substantial energy at the same time.

Another approach that is rapidly gaining traction is edge-lighting, which is similar to the approach used in notebook PC displays. LEDs are placed along one or more edges of the display module, and a light-guide plate (or plates) are used to guide and emit the light evenly behind the LCD panel. In this approach, a smaller number of more powerful LED packages are used, for a less expensive structure. This is also a way of employing RGB backlighting affordably.

LG Display is making LCD panels with W-LED direct backlighting that will be available in TV sets beginning the middle of this year. To support this, it has formed a strategic alliance with U.S.-based LED chip-manufacturer Cree Inc. Under the agreement, LG Display secures a stable supply of LED chips, which LGD identifies as "a key component in next-generation LCD products," and receives technical support from Cree for LED packaging.

LGD’s interested extends beyond TV. The company, which is the leading supplier of LCDs for notebook PCs, plans to establish an early lead in LED-backlit notebook PCs "by internalizing LED related technologies [such] as LED packaging and LED backlighting production.

Sang Beom Han, Executive Vice President and Head of the IT Business Unit at LGD, said, "LG Display will expand the share of panels featuring LED-backlight to 50% of its total notebook LCD output. We will provide differentiated value for our customers and consumers with premium LED-backlight panels."

So, is that good news? Sure. It’s certainly good news for Cree. It’s good for LGD’s LED BLU ambitions. And it reminds us than even in the midst of hard times, the leading panel makers are continuing to focus on their next generations of products. In other words, there is a future. And one way or another, we will get to it.