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LG To Signal Second Guess In TV Business

Admitting to technology challenges in OLED display panels, LG Electronics plans to initiate “Plan B” in its TV business, adopting cost-effective and affordable LCD-oriented microLED technology.

The Korea Institute of Patent Information (KIPI) said LG Electronics recently filed patents relating to the development of display components using luminous elements. LG said OLED displays had a shorter lifespan, as well as a higher number of issues with the production yield defect rate, utilization rate and “burn-in” than conventional LCD-backed displays.

“LED technology could be one possible option for products with enhanced picture quality and improved contrast ratio because the technology is well-positioned to effectively address such looming issues that appeared in OLED displays,” the company said.

The elaboration came with LG Electronics facing a challenge to position itself as a successful “serious leader” in the OLED TV segment hit by low demand and production of OLED displays from its display affiliate LG Display. LG Electronics’ TV business depends on the advanced panels it procures from LG Display. If LG Display struggles, then LG’s entire TV business will suffer.

Over the last few years, LG Electronics has been moving forward with plans to promote TV sets using OLED displays, which are between 20 percent and 30 percent clearer than mainstream LCD TV sets. Its efforts were mostly aimed at enjoying a “first-mover” advantage in the next TV market and departing the already saturated LCD market due to the rapid rise of budget Chinese products.

LG has clearly benefited from the marketing push to the extent that many consumers are convinced that OLED is the best technology for displays but the result did not substantially affect profits.

“It’s very possible LG Electronics will launch a line of LCD TVs using LED technology in the second half of this year,” said an official familiar with LG’s TV strategy.

“Unlike OLED technology, because LED has a similar viewing structure as OLED but uses non-organic semiconductors, it does make sense for LG to pursue a dual-track strategy by expanding the LED TV lineup to the mass market and OLED TVs for selected consumers who have high purchasing power.

During this year’s technology fair in Las Vegas, LG Electronics’ chief executive Kwon Bong-seok told reporters the company would put a lot of effort into promoting OLED displays as the customized technology for smaller digital gadgets and added he was reviewing options to take on lukewarm demand for TVs costing more than $2,000 per unit.

“Demand for premium TVs with a suggested retail price tag of more than $2,000 was about 3 million, globally. We need something new,” Kwon said.

At the Las Vegas exhibition, LG exhibited 145-inch digital signage using microLED technology. This was the first time the Korean technology firm has displayed a set using the LED technology at the fair.

Regarding the patent filings and the exhibition of LED digital signage, an LG Electronics official said the move was intended to respond to the growing demand for larger displays for the business-to-business (B2B) segment not for the business-to-consumer (B2C) segment.

This does not mean LG Electronics will step back from its earlier commitment to embrace the OLED TV business. It means, from a business standpoint, that LG will regard its push for the OLED TV market as a “strategic investment” that will set the advanced TV technology roadmap for years.

As a comparison, LG’s cross-town rival Samsung Electronics rolled out its first OLED TV in 2012 but the world’s top TV supplier immediately switched back to its original position in the segment. Then, in 2015, the firm introduced its patented quantum dot technology, which is built to last much longer than other displays.

The results were quite satisfactory as Samsung introduced advanced LED TVs using the quantum dot technology, which are free of “burn-in issues” using LED as the main backlight unlike organic LED displays ― OLEDs.―Korea Times

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