At sunset, we slept

Electronic News, Jan 6, 1992 by Jack Robertson

TOKYO -- The fate of much of the U.S. computer industry can be seen in a tiny display here -- the active matrix LCD viewfinder of the latest generation Japanese camcorders. The electronic driver circuitry is right on the LCD glass, a harbinger of what is in store for computer displays not many years hence.

Almost all technology savants, including many in America, have seen the logical extension of active matrix liquid crystal displays (AMLCDs) as including the electronics right on the glass -- first in notebooks, then laptops, then desktops and workstations.

AMLCDs and semiconductors are largely fabricated in the same way but so far the glass display and silicon electronic materials must be fired differently. Multilayer multi-material depositions are expected to handle this difficulty. Even with today's technology, the electronics can be mounted as multichip modules on the glass for a single integrated flat panel system.

Integrated electronic/AMLCD panels may come even sooner in other Japanese consumer electronic products, once again tapping the immense economies of scale for production, R&D and capital envestment that pyramid the new technologies. Similar integrated units are likely to show up quickly in avionics and automotive systems, telecommunications, industrial automation, medical and scientific equipment, test instruments and countless other products.

The U.S. is working hard on the same integrated AMLCD/electronic panels as the Japanese, especially at the David Sarnoff Research Center's National Information Display Laboratory.

America has just as many smarts as Japan in this area, although the quantity of research probably doesn't quited match the pervasive Japanese thrust. Yet the sad reality is that without a mass market for any U.S.-developed integrated panels, this technology will end up in the same American dead-end that stymied previous U.S. inventions.

Japan is following its traditional market buildup for new technology. As production economies of scale mushroom and costs plummet, the ever larger size AMLCD/electronic integrated panels could push into ever greater markets. When the Japanese move into integrated computer displays, they will have captured much of the value-added portion of the end product -- first in portables, then in more complex computers.

What value-added is then left to American computer firms, who have so readily bought keyboards, peripherals, semiconductor memories and displays from their Japanese competitors?

The Japanese predict a great market push for just AMLCD panels, even without electronics on the glass. Yasuo Ota, Toshiba vice president and electron tube and device group executive, told a Flat Panel Symposium here that production of AMLCD panels will jump 100-fold in four years, from 1991's 300,000 units to 30 million in 1995. He predicted that the average price of the AMLCD panel will drop from the present $2,000 each to about $400 each in the same time period.

Some American strategists fear the enthusiastic Japanese predictions will scare off U.S. endeavors in the AMLCD arena. If the Toshiba projections are valid, there is little chance the faltering U.S. effort on active matrix displays could achieve any comparable competitive production by the time the Japanese predict a five-fold drop in panel prices.

There is a scenario, however, that portrays a slower Japanese AMLCD buildup. Surprisingly, one cautionary note is sounded by the prestigious Nomura Research Institute of Japan. Norihiko Naono, electronic devices group leader at the study center, said wildly enthusiastic market projections haven't panned out yet for such basic products as 4Mb DRAMs, which the industry knows how to build competitively far better than it knows the frontier technology of large-size AMLCDs.

"The key to the AMLCD flat panel market is how fast producers can bring down the price -- or the market will become much smaller then anticipated. For example, if the 10-inch 640 by 480 pixel color thin-film LCD panel falls only to a price of $650 each by 1995, then the market as a whole will be less then one-fifth of what it was projected to be," he said.

The U.S. must mount a serious research-to-mass-market national program if we intend to remain in the technology race, if not in AMLCDs, then in competing display areas. We won't cut the mustard with the present dribbling, fragmented research projects without foreseeable mass markets to build an industrial base from any developed technology.

President Bush, under the gun because of the recession, has suddenly discovered on his Asian trip the need to build a globally competitive American industry. Yet it is this same President's Administration that has actively shot down every effort to launch a high definition systems national technology program -- certainly one of the keystones to forging a competitive U.S. industrial base.

Better late than never, however. If the President finally sees the light, then let him dust off the year-old report of the Defense Science Board on High Definition Systems and read up on the National Science Foundation on-site survey of the Japanese AMLCD ramp-up.