TOKYO -- A Japanese manufacturer is set to embark on a risky mass production process for OLED panels -- the next generation of electronic displays -- that will test whether the company can find more success than another government-backed challenger.
The new production line is the first to adopt inkjet printing to make organic light-emitting diode display panels on a commercial scale, JOLED President Tadashi Ishibashi said at a ceremony marking the completion of the line.
Like struggling Apple supplier Japan Display -- whose problems have gone from bad to worse with claims of accounting fraud -- JOLED was assembled out of bits of bigger electronics groups with investment from a government-backed fund.
JOLED specializes in organic light-emitting diode panels, a flexible alternative to liquid crystal displays that are starting to be used in iPhones and other mobile devices.
The company had been fine-tuning its production process on a prototype line established in 2016.
JOLED's line at the plant in central Japan is able to handle about 20,000 panel substrates measuring 130 cm by 150 cm each month. The completed panels will be used mainly in medical monitors for the short term.
Conventional methods of producing OLED panels involve vaporizing electroluminescent material in vacuum chambers and require expensive deposition masks. The printing method, which eliminates the need for vacuum chambers and masks, reportedly costs 20% to 30% less than conventional means.
The process "is able to lower costs and can be applied to various products," said Tomiaki Yamamoto, a managing executive officer for JOLED.
Sony put the world's first OLED television on the market in 2007. But South Korean rivals eventually grabbed most of the global share for the TVs thanks to aggressive capital spending. LG Display now dominates this field in terms of production capacity.
Sony and Panasonic merged their OLED operations in 2015 to form JOLED, now partially owned by Japan Display, also known as JDI. The new production line is housed in a refurbished liquid crystal display plant JDI once operated in Nomi, a city in Ishikawa Prefecture.
JOLED seeks to monetize the panel printing method by furnishing the technology to TV display manufacturers for a fee. The company apparently is negotiating with potential clients from China and elsewhere.
During the fiscal year that ended in March, JOLED made just 1.4 billion yen ($12.8 million) in sales. The company suffered a net loss of 25.9 billion yen that year, primarily because of research and development costs. With the production line finished, the manufacturer can finally start business in earnest.
However, obstacles remain for the company and its printing method. For one, monitors made with panels from JOLED's pilot line cost thousands of dollars to purchase.
JOLED's production yields also have been questioned.
"They are still low compared with South Korean competitors whose yields often exceed 80%," an industry insider says.
The printing method "has issues with balancing screen brightness and longevity," said Yoshio Tamura, president of Asian operations for DSCC, a U.S. industry consultancy.