Powder power gives OLED TVs their pop
U.S. company makes essential ingredient for sets
Just a hop and a skip from Thomas Edison’s old Newark stomping grounds, an American small business is helping to invent the future of television.
Universal Display Corp. (UDC), based in Ewing, N.J., is home to a maze of gleaming labs filled with shiny machines and white-coated technicians. They’re perfecting a recipe that will make televisions credit card thin, ultra-lightweight, bendable, even seethrough.
The key to this TV of the future is called OLED, or organic lightemitting diodes. “OLED (is) more than just a feature or enhancement,” said Tim Alessi, director of new product development at LG Electronics. “It’s truly the new state of the art.”
While OLED technology has been in your pocket since the late 1990s, chiefly in mobile phones, its debut in TVs last year triggered a media frenzy. It’s easy to see why: OLED TVs produce far better image quality than any televisions that came before, with deeper blacks, more vivid colors and much higher contrast.
How does this tech work? Where the more common LCD and LED TVs use liquid crystals and a separate back light to produce a picture, OLED sets incor- porate organic molecules that emit their own light when an electrical current passes through them.
UDC develops and produces those elusive molecules. The final product — a powder — gets shipped from UDC to such manufacturers as Panasonic, Samsung and LG.
“UDC has grown from a small New Jersey company to a global technology player,” said Janice Mahon, vice president of technology. But it’s also a case study for the changing nature of the U.S. technology industry.
In 1960, 90% of American households owned televisions, and most were domestic brands such as RCA, Sylvania, Motorola and GE. But gradually, demand for lower production costs pushed manufacturing abroad, and by 1995, the last American TV maker was history.
Yet, the United States remains a powerhouse for research and development. Research roots at Princeton and the University of Southern California helped position UDC in its powerful corner of the TV industry, supplying Korean and Japanese brands with crucial components.
With more than 3,000 patents and counting, UDC expects revenue of between $142 million and $144 million for 2013 — a 30% increase from the previous year.
Since UDC does not sign exclusive licensing deals for its patented OLED materials, there’s still plenty of room for growth.
That growth depends on wider adoption of OLED in consumer goods, and the growth of the OLED TV market in particular. Unfortunately, while OLED is universally admired as a technology, it isn’t readily available or trouble-free in larger displays.
“OLED televisions are painfully expensive,” said Motley Fool analyst Steve Symington, “thanks to a combination of limited manufacturing capacity and low production yields; some estimates pegged total initial yields at less than 30%.”
LG’s first OLED TV retailed for $15,000 last year, and larger sets announced this year easily eclipse the cost of a luxury sedan. But those numbers are falling. Last month, LG slashed the sticker price on 2013 OLED sets by more than half.
“This price drop … is a natural progression for new technology, as manufacturing processes continue to become more efficient,” Alessi said.
The number of OLED options continues to grow. In January, LG announced plans to add new OLED models to its 2014 lineup. “We view OLED as the future of television technology,” he said.
Even if OLED sales are off to a slow start, research and development continue. Symington says Samsung and LG have committed more than 50% of 2014 capitalexpenditure budgets to OLED manufacturing and development.
For small companies such as UDC, that’s great news. UDC’s molecules are also at work in everything from smartphones to OLED lighting, and the number of uses is only expected to multiply.
“Our founder’s vision was to produce technology that could grow the industry,” Mahon said. For more product reviews and news, visit Reviewed.com, a division of USA TODAY.