Will Micro-LEDs Be a Game Changer in the LED Supply Chain?

Micro-LEDs can be a game changer for the LED industry thanks to a host of value-added opportunities, which could reshuffle various parts of the component supply chain, according to LEDinside, a division of TrendForce, at LEDforum 2016. The conference focused on micro-LED as the next-generation display technology.

“Potential applications of micro-LED extend beyond display systems,” said Roger Chu, research manager of LEDinside, in a statement. “Many value-added opportunities related to the development of this technology could lead to reshuffling and extension of various component chains.”

The global LED market is only expected to grow at a compound annual growth rate of two percent from 2016 to 2021, according to LEDinside. To offset the slow growth, the industry is now exploring new application markets, according to Chu.

“Looking at the display application, OLED has already undergone a period of significant development,” Chu said. “With South Korean technology enterprises controlling most of the crucial OLED patents, those companies that are now considering entering this market will have little chance of catching up. Micro-LED, on other hand, is a technology that has room for new entrants to develop market opportunities.”

Some of the biggest advantages of micro-LED technology include lower power consumption, higher brightness, enhanced color saturation and extremely high resolution, cited industry analysts.

“Greater brightness, lower power consumption, enhanced color saturation and extremely high resolution are also some of advantages that micro-LED possesses,” said Chu. “It is even possible for this technology to combine with flexible substrates, thus creating curved displays comparable to ones based on OLED. All these qualities give micro-LED a wide range of application options.”

“Compared with the existing technologies, micro-LED offers significant improvements in many areas, including brightness/contrast, energy efficiency and response time,” said Philip Chang, LEDinside analyst in a statement. “It also satisfies the demand for higher pixel density (expressed as pixels per inch or PPI) and other product design requirements, such as flexible and transparent screens. In sum, micro-LED overcomes the limitations of both LCD and AMOLED, and the mass production of displays based on this technology is foreseeable in the near future despite many unresolved technical issues.”

Other benefits include lower cost, greater longevity and thinner displays, according to Robert N. Castellano, president of The Information Network.

Source: LEDinside

Despite the benefits of the technology, the transition to micro-LEDs could have an impact on the LED supply chain. If, for example, all wearable devices and public displays switched to micro-LEDs, it would consume as much as 50 percent of the current LED production capacity globally, according to LEDinside. And if all smartphones adopted the technology, it would “require four times as much global capacity.”

In addition, like the transition to OLED next year, which is already negatively affecting LCD suppliers and the LCD market supply chain, the transition to micro-LEDs in 2018 is expected to negatively affect OLED suppliers, including equipment manufacturers, according to Castellano, in a Seeking Alpha article.

Castellano noted in the article that he expects Apple to “move away from Samsung's OLEDs in favor of micro-LEDs for the iPhone 9 in 2018. Apple acquired micro-LED technology with its 2014 acquisition of LuxVue and was awarded a U.S. patent 9,379,092 on June 28, 2016, based on the work done at LuxVue.”

But before significant adoption happens, micro-LED manufacturers have to solve several technology barriers.

“There are still numerous technological bottlenecks that have to be addressed in the course of developing micro-LED displays,” said Chu. “The most critical juncture is the mass transfer of micron-sized LEDs onto substrates. Finding a solution to this challenge will also open up the possibility of mass transferring other microelectronic components, including sensors.”

Chu said “micro-LED provides sufficient pixel pitch to incorporate different sensors that are on the displays of mobile devices.”

“In the future, the development of micro-LED displays for mobile devices will likely allow for the integration of optical and fingerprint sensors (and perhaps other types of sensors as well),” he added. “This is an advantage that the current OLED technology does not have. Hence, micro-LED is not only poised to expand into various display applications but also has the potential to generate additional values for end devices. The room for development is huge.”

Micro-LED displays for smart wearable devices is expected to reach volume production in 2018, followed by displays for smartphones in 2020, according to LEDinside.