LG Display presses on with OLED TV despite doubts

[January 06, 2015]  By Se Young Lee

SEOUL (Reuters) - South Korea's LG Display Co Ltd plans to increase production capacity of organic light-emitting diode (OLED) panels for TVs, seeking growth in a new technology field that its rivals have dismissed as still too expensive to succeed.

LG Display and its sister company, the world's second largest TV maker LG Electronics Inc, have been the biggest proponents of OLED TVs, which they hope will give them a competitive edge over rivals once the technology matures.

On Tuesday, LG Display said it would more than quadruple the monthly production capacity of OLED TV panels to 34,000 units by the year-end from 8,000 currently.

The companies say OLED is far superior to the mainstay liquid crystal display (LCD) technology, offering better picture quality as well as lower power consumption. Costs, however, are much higher, making OLED TVs several times more expensive than LCD sets.

Samsung Electronics Co Ltd, the world's biggest TV manufacturer, has steered clear of OLED, saying the technology is not ready yet for mass consumption. It has focused on quantum dot technology instead.

The LG companies have declined to comment on their OLED investments to date, LG Display last year finished building a 706.3 billion won ($640.58 million) factory to increase production of OLED TV panels. The panel maker did not comment on its investment plans for 2015.

Analysts remain sceptical about OLED's future, mainly due to price. LG Electronics' 65-inch ultra high-definition OLED TV launched in South Korea last year was priced at 12 million won ($10,874), more than three times the price of a comparable LCD TV by the same company.

The emergence of quantum dot TVs is also seen as a potential threat. The technology is easy to implement and offers improved picture quality at much a cheaper cost than OLED, offering TV makers an attractive alternative.

Samsung is putting its weight behind quantum dot this year with new products launching as early as end-February. It says OLED is still too difficult to manufacture, making it too expensive for consumers. The company has said these challenges cannot be overcome within the next two or three years.

LG Electronics is also launching its own quantum dot TVs alongside OLED products this year in what it says is a two-track strategy. Analysts say this is tacit acknowledgement that OLED is not yet ready.

(This version of the story corrects production figure in par 3 to 34,000)

(Reporting by Se Young Lee; Editing by Ryan Woo and Miral Fahmy)

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