New LCD plant could mean cheaper big-screen TVs

A new LCD (liquid crystal display) factory has opened in South Korea that could mean cheaper flat-panel televisions are on the way.

A new LCD (liquid crystal display) factory has opened in South Korea, with cheaper flat-panel televisions potentially on the way as a result.

The plant is operated by S-LCD Corp., a joint venture between Sony Corp. and Samsung Electronics Co. Ltd. The first LCD panels left the plant Tuesday, Samsung said in a statement.

The factory makes the panels on a so-called "8th generation" production line. That means it uses mother glass -- the large sheets of glass on which several panels are produced -- measuring 2.2 meters by 2.5 meters. S-LCD already operates a 7th generation line at a site in Tangjeong that uses glass measuring 1.87 meters by 2.2 meters. The new factory processes significantly larger sheets of glass, which is important because the use of larger sheets brings production efficiencies that can result in lower respective prices of LCD panels.

In today's cut-throat LCD TV market, those production savings are likely to be passed on to consumers.

The 7th generation line is most economical when used to produce either eight 40-inch panels or six 46-inch panels from each sheet of mother glass. The new 8th generation line will work most economically to produce 46-inch and 52-inch panels so the price effects are likely to be seen in these areas of the market.

The output from the factory goes equally to Sony and Samsung for use in the their LCD TV sets. While the two companies are partners on the production side, they remain fierce competitors in the television marketplace. Each has developed its own proprietary signal processing technology to produce a picture that beats the other, along with competitors.

In the first three months of this year, Samsung led the world LCD TV market with shipments of 2.4 million sets, according to data from iSuppli. That gave the company a 16.8 percent market share. Sony was ranked second with shipments of 1.8 million sets for a 12.6 percent share.

The new factory represents an investment of 1.8 trillion won (US$1.9 billion). Full output of 50,000 panels per month is due by the end of this year.

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Martyn Williams

IDG News Service
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