When Sony launched the world's first OLED (organic light emitting diode) television in late 2007 it seemed like a new era in flat-panel TV was beginning. True wall-hanging TVs just a few millimeters thick would finally be realized and those TVs would deliver crisp, colorful pictures that made current LCDs look almost dull by comparison.
Never mind that the 11-inch TV cost over US$2,000 -- new technology is always expensive at first and gets cheaper, right? Pushing the feeling that technology was quickly progressing, Sony also showed a 27-inch prototype at the same time, and within a few months Samsung took the wraps off prototypes of its own.
Sony CEO Howard Stringer, on stage in the U.S. in May 2008, got caught up in excitement for the coming OLED age and promised the launch of the 27-inch model commercially within a year. It's now been a year and three months since Stringer made his prediction but there have been no new OLED TVs from Sony.
The absence of a new model has highlighted not just Sony's slipping schedule but that of the industry as a whole. Samsung has yet to launch its OLED TV and all eyes are now on LG Display, which had a 15-inch prototype at this year's CES and said it would ship about now.
OLED screen makers are facing a couple of challenges,said Jim Masuda, director of display market research at iSuppli in Tokyo. The first is technical.
Sony launched an 11-inch OLED TV not because the market was demanding a small television but because mass production at typical TV sizes, those between 20 inches and 50 inches, is still difficult with OLED. The screen technology has proved difficult to scale so while it's in common use in cell phones and music players it isn't being mass-produced at larger sizes.
Screen life is also an issue.
"Companies are now looking at large-size OLEDs of around 40 inches but it's uncertain how they will produce them," said Masuda. One hurdle is applying the organic material from which light is emitted in an even manner across the screen. An uneven coating will mean differences in display brightness and that's obviously no good for a television.
The companies are experimenting with several competing material application technologies, including vapor deposition and ink-jet printing. There are also different organic compounds that can be used and a lot of work is going into studying those. Sony and LG are both working with Japan's Idemitsu while Panasonic has tied up with Sumitomo Chemical.
Even when the technical problems are solved, there's the issue of making the screens cheap enough to compete with LCD.
"After [Sony] introduced the 11-inch OLED all of the TV makers were researching how to make larger sets," said Masuda. "In the meantime LCD prices were dropping drastically and if an OLED TV is introduced it must be price competitive."
Oversupply has been affecting LCD panel prices for most of the last year and the problem was compounded by lower demand from TV makers after consumers cut back on spending due to the global recession. The average price of a 32-inch LCD panel fell from US$335 in January 2008 to around $200 at the end of the year, according to DisplaySearch.
Sony's first set was able to command a high price because its OLED TV was first to market and found customers among early adopters, companies and retailers looking to impress visitors and curious competitors in the TV business.
But it was never destined for the mass market. The production line can only handle up to 2,000 sets per month and hasn't been expanded since. Sony won't comment on actual production although only around 1,000 OLED TVs were sold in the last three months of 2008, according to an estimate from DisplaySearch.
However LCD panel prices have recently begun to rise, reducing some of the pricing pressure for the time being.
There were no new OLED TVs at last week's IFA electronics fair in Berlin, so the next major OLED TV announcement could come in October at Tokyo's Ceatec fair. Sony used that show in 2007 to launch its XEL-1. Another possible OLED TV launchpad could be CES 2010 in Las Vegas in January, when the world's major consumer electronics makers come together.