PixTech in Asian pact for FED output; with NEC?

Electronic News, Dec 2, 1996 by Andrew MacLellan

Santa Clara, Calif.--Field emission display (FED) designer PixTech has signed a memorandum of understanding here with an unnamed Asian active-matrix liquid crystal display (AMLCD) company which could bring PixTech's FED technology into volume production as early as 1H98.

The company would not identify its partner, although among the litany of candidates mentioned by industry observers, NEC was the most frequently named.

The agreement will begin with a feasibility program to determine the extent to which the Asian vendor's manufacturing equipment must be replaced. If the first phase of the pact is successful, PixTech said products could begin rolling off the line within 12-18 months.

PixTech currently sells its FED-based display products into the commercial avionics, medical, automotive and test markets, but with more capacity could branch into portable consumer electronics such as PDAs or handheld computers.

"PixTech has always kept their eye on a niche market," said one industry observer. "What they might be trying to do is generate the manufacturing know-how which they could use as they climb up the ladder."

According to PixTech VP of marketing and sales Tom Holzel, the agreement would supplement the company's existing fab in Montpellier, France, and increase production from 100,000 to more than 1 million panels per year. The company is financing its ramp-up through an initial public offering (IPO) filing in Europe, which is expected later this month.

The arrangement should allow PixTech to focus the output of its current Montpellier facility on the short-run and specialty display markets, while the high-volume line would be directed toward mainstream demand.

"If you build a new fab, you're buying everything, and everything's got to be ordered and installed and you're training people who aren't used to the equipment and it's all got to be debugged," said Mr. Holzel. "By going into a fab location where all of this already exists and merely replacing some of the fabrication equipment, you don't have any of these headaches."

The deal has market observers buzzing over which vendor is taking the plunge into the fledgling FED technology, which to date has reported little progress outside of the research lab. Mr. Holzel said the Asian company will step forward only when it has made a commitment to manufacture.

"You don't want to tell everyone you're getting married when you're just dating," he said.

While wide speculation has done little to winnow the field of candidates, the agreement does suggest that OEMs are beginning to look seriously at FED technology in the hope of gaining an edge on the next lucrative display science.

FED-based panels are being explored by a number of Japanese and U.S. companies, including NEC, Canon, Micron Technology and San Jose, Calif., start-up Candescent Technologies (EN, Aug. 5). Additionally, Motorola, Raytheon and Japan's Futaba are involved in an FED development alliance with PixTech which counts more than 270 patents issued or pending.

Just how deeply FED will penetrate the well-established LCD market, however, is unknown. While analysts say it is unlikely to gain much against notebook LCDs, the technology's cost/performance advantages may enable it to make headway in a range of consumer applications.

One notable exception is Candescent, which is pitting its FED technology directly against its portable PC competitors' LCDs and will unveil its 320mm x 340mm development line early next year. Candescent marketing director Nicholas G. Sturiale said the PixTech agreement is heartening news for every start-up pinning its hopes on FED as the successor to AMLCD.

"From our perspective we're very encouraged by the development because we fully believe there will we plenty of room for multiple players in this area," said Mr. Sturiale. "We are hopeful and optimistic that they (PixTech) will make progress."

Hampering efforts is the fact that FED displays still struggle with yield issues and longevity even if they are acknowledged to have a wider viewing angle, lower operating temperature and lower power consumption than LCDs. In certain applications, however, they have begun to assert themselves, as demonstrated by PixTech's 5.2-inch display for automotive global positioning satellite (GPS) applications.

"Definitely for the automotive market, they're (PixTech) very well-positioned," said Ross Young, president of the display market research and consulting company Display Search. "FED doesn't have any of the issues LCD has with polarizers which are affected by humidity. They have a faster response time and are very bright as well."

According to Mr. Holzel, PixTech's next FED screen will be an 8.5-inch panel manufactured in France in late 1997. The company also has a prior development agreement with a Japanese CRT vendor to design 15- to 42-inch screens for wall-mounted, high-definition television (HDTV) and other applications. For this project, PixTech said it using its Large Screen (LS) FED technology, a high-voltage technique with a different internal architecture than standard FEDs.