'Good news' still for gear suppliers

Electronic News, Feb 3, 1997 by Gale Bradley

San Jose, Calif.--Although the news is only good right now for those equipment suppliers who have been planning, and spending, for it, "very tight" supply and Asian fab capacity for 12-inch and above flat panel displays (FPDs) is not fleeting, and several FPD gear vendors are themselves at capacity through the middle of this year.

What adds to the good news is the further convergence of semiconductor-like processes in making the panels, NEC's Electronic Component Development division GM Hidehiko Katoh said in a conference here last week. Mr. Katoh said a thin film transistor-liquid crystal display (TFT-LCD) and its pixel drivers is 70 percent made with semiconductor processes and technology. All the easier for those semiconductor equipment makers to leverage their process technology and sell to the display makers, it was said.

At last week's DisplayWorks 97 conference here, a source told Electronic News that the heralded Continuum cluster from Lam Research (see The Fab Line, page 46) and the offerings from Applied Komatsu Technology, the joint venture of Japan's Komatsu and Applied Materials, are sold out through June. Whether that is true could not be independently confirmed.

Still great momentum in new, third-generation capacity ramping in Japan and Korea was evidenced by Eaton, who is poised to capitalize on the transition to polysilicon-based TFT-LCDs with its new 6072NV ORion implanter that sells for between $3.5 million and $4 million; by CFM Technologies, which has booked millions in wet FPD processing equipment orders; and Brooks Automation for material handling within cluster tools, to name a few. Eaton is partnering with Sumitomo Nova of Japan and formed an FPD equipment division in the fall in anticipation of the need for polysilicon implanting for displays, said Jim Stevens of Eaton's FPD unit.

Repeated throughout the show was news of upcoming capacity in Asia, building for the booming 12.1-inch LCD panel market fueled by the demand for the latest notebook computers and also to start toward the day when LCDs can be made cheaply enough to get them on desktops.

Display Technology, Inc. (the joint venture between Toshiba and IBM), Sharp and Samsung have third-generation LCD manufacturing facilities in production now, which is to say they are manufacturing on the largest substrates yet, 650mm X 550mm. Still the substrate size up next is in constant flux, a source of much frustration for equipment makers and more frustration for those watching the cycle of non-standard substrates.

Mr. Katoh of NEC told his audience at the U.S. Display Consortium-sponsored Imaging 2001 business conference that the company is targeting cathode ray tube (CRT) replacement in an aggressive two-pronged commitment, ramping quickly to TFT-LCDs for notebooks and desktop monitors and quickly to lower resolution but larger plasma display panel production for entertainment and public display.

According to Sweda Dash of display research firm Stanford Resources (San Jose, Calif.), Hitachi will have a fourth-generation LCD line starting in mid-July; Fujitsu and Mitsubishi are ramping third-generation lines; and "all three Koreans," Hyundai, LG and Samsung are ramping for LCD production. In fact, Thomas Striegler, senior strategic marketing manager for Samsung Semiconductor, told the conference attendees his company is going to spend $1.4 billion on their third-generation LCD fab.

And the news just gets better for those who can keep on top of those customers' needs, because "mass production lines must be specialized for each market," Mr. Katoh said.

One source talked of the very serious competition between the Japanese and the Korean panel producers, saying that the reason the Electronic Industrial Research Association of Korea signed a memorandum of understanding (MOU) with the USDC is that the Korean manufacturers want a way to influence and collaborate with North American equipment makers, as they could not garner any such influence in Japan.

USDC chairman Malcolm Thompson chose not to comment on the nature of such competition, but he said, "The Koreans certainly wanted a way to work together with equipment companies."

More than one participant at last week's events in San Jose said the need for equipment makers to get together with flat panel display makers right now is very urgent, among them Steven Depp, the IBM researcher that drove the Toshiba/IBM DTI collaboration.

"I'm positing that we need to drive something like a Moore's Law with larger display sizes coming from greater cost reduction...There really needs to be some alternate relationship between display and equipment makers, one that begins far prior to delivery.

"We need to get the production cost down by factors of two and three," Dr. Depp said. "This is not undue demands on equipment makers, it is that display makers need help in driving down those costs. And that means less 'semiconductor-like' processes in terms of materials consumption, less spinning of materials, like the polyimide, so 90 percent of it never gets on the substrate...The equipment makers need to come to the display makers in development, because the display makers cannot find these solutions themselves."