Seeing OLED as the future for displays, LG bets big on new factory

LG is spending $380 million on a factory to make OLED screens

Ultra-vivid OLED screens could replace LCDs in TVs, PCs and mobile devices, and LG wants to be ready for that.

LG Display, a unit of parent company LG Electronics, is investing US$380 million in a production facility for OLED panels to address "growing market demand," according a SEC filing on Tuesday.

The investment could indirectly help reduce the price of OLED TVs, which are more expensive than LCD/LED TVs. Some OLED TVs are already available, but price tags are high largely because they are expensive to make.

Monitors and laptops with OLED screens were shown for the first time earlier this month at CES, but the estimated cost of putting OLED panels in PCs is twice that of LCD panels, said David Hsieh, director of display research at IHS in an interview earlier this month. The price of panels can be driven down through volume manufacturing, Hsieh said.

Samsung is the dominant provider of OLED screens today. The OLED PCs and monitors shown at CES used panels from Samsung, which also provides displays for many mobile devices and wearables. With its factory investment, LG hopes to catch up with Samsung.

OLED screens are brighter, thinner and consume less power than LCD technology, which dominates flat panels. The absence of lighting back-panels in OLED displays makes them thinner and more power-efficient than LCDs. A thinner layer of organic material lights up when current passes through it, which helps save power.

An LG 55-inch OLED TV is available now for $1,800. LG also wowed CES attendees with a transparent display that could be bent.

But issues remain, and many of them are similar to problems that early LCD technology had. There are questions about durabiity, and burn-in issues -- involving images that stay on screen even after a computer has been powered down -- have also been identified.

The factory investment will begin in the first quarter of 2016 and last through the second quarter of 2017, LG said.

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