(iTers News) - With no end in sight to years-long nightmarish slumps in global TV market, Samsung Display has started operation of its 8th generation of TFT-LCD fabrication facility in Suzhou, China., adding to concerns that it would exacerbate a massive overhang of supply gluts.
Named as Samsung Suzhou LCD, the 8th generation TFT-LCD facility will manly produce 48-inch and 55-inch full HD and 4K ultra HD LCD panels out of glass substrate measuring 2200m x 2500mm.
Samsung Display has dragged its feet on the construction of the Suzhou , China TFT-LCD facility for the past four years, blaming excessive supply glut in global LCD panel market.
In May, 2012, the world’s largest LCD panel maker finally came to break ground to build the facility, because the Chinese government threatened to revoke its concessions for the operation of the facility unless it starts construction.
The operation comes at the worst time when supply gluts keeps swelling like a snowball as TV demand stays sluggish.
Looking forward, however, the global TV market is now at a critical junction point that TV makers are turning to 4K ultra HD TVs for an exit out of the year-long slumping. Especially, Chinese TV makers are rapidly rolling out 4K UHD TVs to revitalize sluggish TV demand. Chinese government's plan to slap an heavy duty on imports of LCD panels also has also spurred Samsung to start operations. The Suzhou China facility is a sort of an integrated manufacturing cluster that accommodates a whole range of manufacturing ecosystem from a front-end fabrication line to a back-end assembly and module line to parts and components supply to logistics.
According to market research firm NPD DisplaySearch, 1.3 million 4K TV sets will ship globally in 2013, and will rise to 23 million in 2017, and Chinese set makers are looking to break out of their domestic market and challenge Samsung, LG, Sony, Panasonic, and other 4K TV leaders on a global stage.
“4K TV is a completely different feature in China, compared to what it is in the rest of the world,” said Paul Gray, director of European TV research for NPD DisplaySearch. “In China, 4K TV sets have modest capabilities, start from smaller sizes, and are priced at relatively low premiums. By contrast 4K TV sets elsewhere in the world are very large, have relatively complex image processing, and have some degree of future-proofing.”
The 4K TV broadcast and content chain is at an early stage of development. As a result, global CE brands are biding their time with this new generation of products, because 4K TV broadcast standards – a key building block for growth – are missing, and programming is limited. Meanwhile, emerging standards, such as HDMI 2.0, are critical to the content chain. “It is quicker to design a TV, than it is to craft a broadcasting standard that will endure for at least a decade,” Gray said. “Once standards are ratified and broadcast services start to roll out, then global brands will accelerate and launch more mainstream products.”
Between 2013 and 2017, China is expected to comprise over half of all global 4K TV shipments, due to the combination of lower price premiums and the availability of small sizes down to 39”. “Competitive pressure may indeed build in some regions, driving prices for Chinese brands down further, and stimulating growth; however, there has been a distinct reluctance by Korean and Japanese brands to chase Chinese pricing,” according to Gray.