FPD Makers Rally Around Standardization

By Spencer Chin

EBN, March 23, 2001 - AUSTIN, Texas--As they nervously watch prices drop and growth slow, makers of flat-panel displays are rallying around the flag of standardization.

At this week's DisplaySearch FPD Conference and High-Resolution Symposium here, FPD suppliers and their OEM customers examined ways to broaden existing standards governing displays' physical and electrical parameters, and to standardize the methods and materials used in FPD manufacturing as well.

The conference took place at a time when thin-film-transistor (TFT) LCDs have flooded the market. This glut, fueled by display suppliers' robust capacity expansions two years ago in response to pent-up demand, has forced a succession of price drops that may not end quickly, according to analysts and others at the conference.

The call to broaden standardization was summarized by Paul Salisbury, a senior notebook design engineer at Dell Computer Corp. in Round Rock, Texas.

"Without standardization, it's difficult to reduce costs and allow new display technology to fit into OEM product designs," said Salisbury, who has been active in trying to implement industry-wide standards through the Standard Panels Working Group (SPWG), formed in 1999 by Compaq, Dell, Hewlett-Packard, IBM, and Toshiba.

The SPWG's first effort, Version 1.0, defines a recommended set of standards for the physical dimensions, mounting-hole tolerances, connector types, and electrical and interconnection parameters for TFT LCDs having XGA (1,024 ?? 768) resolution.

The group is now finishing a revised set of standards, Version 2.0, that would expand coverage to include SXGA+ (1,400 ?? 1,050) and UXGA (1,600 ?? 1,200) LCDs, including those with thin profiles for thin notebook computers.

While a number of companies have endorsed the SPWG's standards, their implementation has been fitful, according to Salisbury. "While a lot of companies have SPWG-compliant displays on their product road maps, implementation of the standards doesn't occur until a product is redesigned," he said.

Because the SPWG hasn't wanted to stifle product innovation, its scope has been limited to physical and electrical specs, not parameters such as display glass type or components, he said.

One conference speaker, however, called for the scope to be even further broadened. Duke Koo, executive vice president of worldwide sales at LG Philips LCD, Seoul, Korea, suggested the creation of two additional standards groups, which he said could be named the SCWG (Standard Components Working Group) and SMWG (Standard Manufacturers Working Group).

These groups, he said, should be charged with implementing standards for module sizes, definitions for parts such as polarizers and filters, and production methods.

Koo rattled off the variations in display manufacture that he believes require standardization. "There are two to five different substrates; hundreds of different polarizers, color filters, and driver ICs; and more than 100 finished display modules having the same size.

"We need a new business model," said Koo, who asked display suppliers to band together to cut costs amid shrinking profit margins and continuing consolidation within the display industry. Suppliers, he said, should "stop competing to see who can produce the largest display" and instead focus on features and quality.

One obstacle to implementing standards more broadly, Dell's Salisbury noted, is suppliers' traditional emphasis on differentiating their displays.

During one session, for instance, Greg Jozwiak, senior director of portable and communications products at Apple Computer Inc., touted the company's 15in. XGA display, called Mega-Wide.

Unlike other 15in. displays, it is not a high-resolution FPD, but instead is distinguished by the wide aspect ratio of its characters. To those who questioned why Apple doesn't create a standard high-resolution display instead, Jozwiak said, "We doubled our display business in 2000 without a high-resolution display."

The willingness of most participants at the conference to strongly pursue standardization was at least partially triggered by FPD market realities set forth in a chilling forecast by Ross Young of DisplaySearch.

The research firm predicts FPD revenue will grow only 6% this year, following 26% growth in 2000. He attributed the slowdown mostly to price erosion caused by TFT LCD makers' recent "excessive" capacity investments.

A wave of price cuts has dropped average TFT LCD notebook prices by 20% from the fourth quarter of 2000, to $286 in the first quarter of 2001. Young expects prices to continue to slide through at least August.