Taipei, Thursday, January 29, 2015 06:27 (GMT+8)
light drizzle
Taipei
15°C
Digitimes Research: Melfas eyes top notch in Korea touch panel industry
Ricky Tu, DIGITIMES Research, Taipei [Wednesday 26 March 2014]

Samsung Electronics' mid-range and entry-level mobile devices (smartphones and tablets) in 2013 mostly adopted touch panels using thin-film technologies such as glass-film-film (GFF) or glass-film (G1F). Because the key component, the indium tin oxide (ITO) transparent conducting film (TCF), had been in short supply since the second half of 2012, Samsung decided to adopt G1F technology, which uses fewer ITO films compared to GFF technology for its entry-level/mid-range products. However, the strategy has triggered a reshuffle in Korea-based touch panel makers' rankings in terms of revenue performance.

Samsung's main touch panel supplier is Korea-based Melfas, which focuses on developing G1F technology. Melfas's revenues for the first three quarters of 2013 were KRW495 billion (US$458.18 million), up significantly from the KRW191.6 billion of the entire 2012, approaching fellow maker Iljin Display's KRW510.3 billion and surpassing Smart Mobile Application Company's (SMAC) KRW415.8 billion for the same period.

But Melfas still has weaker operating profits compared to GFF suppliers Iljin Display and SMAC. This shows that G1F's yield rate is still not as stable as that of GFF.

ITO film shortages have started easing since the second half of 2013. If G1F continues to see yield rate issues, Samsung may stop using G1F touch panels in 2014. To further reduce its mobile devices' thickness, Samsung is expected to start adopt more slim GFF and GF SITO (GF1) touch panels.

Slim GFF is able to reduce the thickness of a touch panel by shrinking the ITO film's thickness. In 2014, Iljin Display and SMAC will both shift some of their capacities to produce slim GFF touch panels. Meanwhile, to avoid the impact created by Samsung stopping using G1F, Melfas has developed GF1 technology that only uses a single piece of ITO film, similar to G1F. GF1's yield rate is also easier to improve.

On the other hand, Korea-based LG Innotek, an affiliate of LG Group, is currently supplying GFF and glass only (G2) touch panels and the company's revenues from related businesses rose significantly from KRW66.3 billion in 2010 to KRW560 billion in 2013. However, LG Innotek is still facing challenges such as raising its G2 yield rates and selling products to non-LG clients.

If Samsung stops adopting G1F touch panels, Digitimes Research believes Melfas's GF1 production will be crucial to sustaining its business in 2014.

Realtime news
  • HTC sponsors eSports teams Cloud 9, Team Liquid, Team SoloMid

    IT + CE | 8h 6min ago

  • China software industry posts 2014 revenues of over CNY3.7 trillion, says MIIT

    IT + CE | 8h 10min ago

  • SK Hynix posts record earnings for 4Q14 and 2014

    Bits + chips | 8h 13min ago

  • Global advanced driver assistance systems market to exceed US$90 billion by 2020, says ABI Research

    IT + CE | 8h 15min ago

  • UMC looks to wafer shipment and ASP growth in 1Q15

    Bits + chips | 8h 17min ago

  • Corning reports 4Q14 and 2014 financial results

    Displays | 8h 19min ago

  • Taiwan market: Local retailers expect 20% sales growth from Ultra HD TVs

    Displays | 8h 23min ago

  • Digitimes Research: China smartphone shipments drop 8.8% sequentially in 4Q14

    Mobile + telecom | 8h 28min ago

  • Touchscreen controller IC vendors diversifying product lines

    Before Going to Press | 8h 39min ago

  • Acer online ticket services deserve praise, says founder

    Before Going to Press | 8h 40min ago

  • Digitimes Research: Global tablet shipments grow 16.9% sequentially in 4Q14

    Before Going to Press | 8h 41min ago

  • SPIL nets NT$3.74 per share for 2014

    Before Going to Press | 8h 41min ago

  • SPIL to offer fan-out packaging services in 2016

    Before Going to Press | 8h 41min ago

  • Asustek facing challenges in 2015

    Before Going to Press | 8h 43min ago

  • UMC expects wafer shipment and ASP growth in 1Q15

    Before Going to Press | 8h 45min ago

  • Giga Solar Materials sees booming shipments of PV silver paste

    Before Going to Press | 8h 46min ago

  • TPK expects fingerprint recognition touch panel orders to increase in 2015

    Before Going to Press | 8h 46min ago

  • TV vendors optimistic about WCG LCD TV development in 2015

    Before Going to Press | 8h 47min ago

  • SK Hynix posts record earnings for 4Q14 and 2014

    Before Going to Press | 8h 48min ago

  • China software industry posts 2014 revenues of over CNY3.7 trillion, says MIIT

    Before Going to Press | 8h 48min ago

  • China sets 2015 tentative target PV installation capacity of 15GWp

    Before Going to Press | 8h 49min ago

  • Samsung to increase smartphone production in India, says report

    Before Going to Press | 8h 51min ago

Pause
 | 
View more
VOICE 2015 Developer Conference
Wireless broadband developments in Southeast Asia markets
The transition to 4k TV - UHD TV market forecast, 2014-2017
  • Wireless broadband developments in Southeast Asia markets

    As of 2013, the 10 ASEAN nations had a total of over 700 million mobile subscriptions, with the CAGR from 2003-2013 reaching 24%. This Digitimes Research Special Report analyzes the various mobile broadband markets in ASEAN and looks at the respective trends in 4G LTE development for those markets.

  • Greater China touch panel shipment forecast through 2015

    This Special Report provides forecasts through 2015 for Greater China touch panel shipments with breakdowns based on technology (glass, film, resistive), application (smartphone, NB and tablet) and by firm.

  • 2014 global tablet demand forecast

    This report analyzes the main players, their strategies and shipments forecasts for 2014, as well as other factors contributing to either growth or decline in various segments within the tablet market, with a particular focus on Apple, Google, Samsung, and Microsoft, along with whitebox vendors.