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APS Material Could Displace DNP as a Prime FMM Provider
At the beginning of 2020, the Japanese government spooked by what they interpreted as a slight by South Korea, issued a threat they would limit trade on some products where they had a near monopoly on supply. This threat set off a wave of bilateral allegations and caused the Koreans to examine their dependencies on Japan. One of these components was the FMM provided by Japanese companies, principally, DNP, which are used in the production of smartphone displays. Some South Korean companies have been encouraged by Samsung and LG to produce FMMs, but their technologies were far behind the Japanese. The Korean government sponsored a competition offering subsidies to the winners. In February, APS Materials and Poongwon Precision were chosen as the final candidates to lead a national project given by the Ministry of Trade, Industry and Energy to develop South Korea's own FMM manufacturing technology.
FMMs are made from invar and high resolution OLED displays, they need to be 20 micrometers or thinner. FMMs are welded to frames [by the display manufacturers] before the OLED deposition process and defects occur during this process. The FMM’s elongation rate needs to be consistent, as they are pulled from both sides during production. The holes are subject to extension when the mask is tightened, causing misalignment. Their size varies as the pixel design uses a Pentile architecture. In addition, the vaporized light emitting material causes heat while passing through the holes and the invar needs to be heat resistant. All of this takes a lot of expertise to overcome. As invar is an iron plate, its life span is unlimited. FMM manufacturing requires controlling the thermal expansion coefficient and elongation rate. During production the invar is stretched to make it thin, which can cause defects as the additives burst out to the surface. As the iron plate are passed through rolls they must be uniformly spread as they pass thru the rolls causing pressure on the plate. Unless the pressure is spread evenly, the iron plate curls.
While the FMM have no lifetime issues, they do require constant cleaning during use to remove extra organic material. They can be affected by the chemicals used for the cleaning, which is often bad enough to require a replacement. Each new panel design may require as many as the 100 individual FMMs that are obsoleted with the panel design.
Japan’s Dai Nippon Printing (DNP) has the largest market share with Japan’s Toppan Printing next. Darwin in China also [produces FMMs, but their volume is low. DNP supplies FMM that are 25 micrometers or thinner only to Samsung. A thicker FMM means it will be more prone to defects. Samsung has been using the thinnest FMM available, so it has a very high panel yield rate. LG and Chinese companies use thicker FMMs, but they seem to work, although the panel yields may be lower than Samsung’s. UBI quoted DNP’s FMM manufacturing yield at around 20%. Toppan’s was around 10%. Panel makers take these FMMs and attach them to frames, which causes further defects __ so the yield rate is halved again from this. Samsung can only secure one out of ten to be used.
There are two ways to make a FMM; etching and electro forming, which is a form of plating. And the third way is laser patterning. APS is developing a laser patterning. Process, which they claim will enable higher pixel densities up to 1000 ppi. Current smartphone panels max out at ~500 ppi. Poongwon Precision uses etching. Philoptics uses electro forming. DNP and Toppan of Japan use etching.
APS Materials’ laser patterning method includes the elongation of the iron plate and control of its thermal expansion. In addition to the basic process, APS will need inspection equipment and other equipment, which exceeds a capex of 100 billion won (US$88 million) will be needed for production. APS will first need to make FMMs that can be qualified by Samsung, which would enable Samsung to develop a transition plan to bring in a new FMM supplier. When Samsung contracts with another vendor besides DNP, DNP will likely need some type of compensation or lose its monopoly position. An individual FMM cost between $50K and $60K and there are 100 FMMs used for each panel design, which puts the SDC produces between 30 and 50 panel designs so the total revenue for FMM from Samsung is in the 100s of millions of dollars. Given that the Korean government is partially funding the program they may have some influence on Samsung and LG’s decision process.
At the beginning of 2020, the Japanese government spooked by what they interpreted as a slight by South Korea, issued a threat they would limit trade on some products where they had a near monopoly on supply. This threat set off a wave of bilateral allegations and caused the Koreans to examine their dependencies on Japan. One of these components was the FMM provided by Japanese companies, principally, DNP, which are used in the production of smartphone displays. Some South Korean companies have been encouraged by Samsung and LG to produce FMMs, but their technologies were far behind the Japanese. The Korean government sponsored a competition offering subsidies to the winners. In February, APS Materials and Poongwon Precision were chosen as the final candidates to lead a national project given by the Ministry of Trade, Industry and Energy to develop South Korea's own FMM manufacturing technology.
FMMs are made from invar and high resolution OLED displays, they need to be 20 micrometers or thinner. FMMs are welded to frames [by the display manufacturers] before the OLED deposition process and defects occur during this process. The FMM’s elongation rate needs to be consistent, as they are pulled from both sides during production. The holes are subject to extension when the mask is tightened, causing misalignment. Their size varies as the pixel design uses a Pentile architecture. In addition, the vaporized light emitting material causes heat while passing through the holes and the invar needs to be heat resistant. All of this takes a lot of expertise to overcome. As invar is an iron plate, its life span is unlimited. FMM manufacturing requires controlling the thermal expansion coefficient and elongation rate. During production the invar is stretched to make it thin, which can cause defects as the additives burst out to the surface. As the iron plate are passed through rolls they must be uniformly spread as they pass thru the rolls causing pressure on the plate. Unless the pressure is spread evenly, the iron plate curls.
While the FMM have no lifetime issues, they do require constant cleaning during use to remove extra organic material. They can be affected by the chemicals used for the cleaning, which is often bad enough to require a replacement. Each new panel design may require as many as the 100 individual FMMs that are obsoleted with the panel design.
Japan’s Dai Nippon Printing (DNP) has the largest market share with Japan’s Toppan Printing next. Darwin in China also [produces FMMs, but their volume is low. DNP supplies FMM that are 25 micrometers or thinner only to Samsung. A thicker FMM means it will be more prone to defects. Samsung has been using the thinnest FMM available, so it has a very high panel yield rate. LG and Chinese companies use thicker FMMs, but they seem to work, although the panel yields may be lower than Samsung’s. UBI quoted DNP’s FMM manufacturing yield at around 20%. Toppan’s was around 10%. Panel makers take these FMMs and attach them to frames, which causes further defects __ so the yield rate is halved again from this. Samsung can only secure one out of ten to be used.
There are two ways to make a FMM; etching and electro forming, which is a form of plating. And the third way is laser patterning. APS is developing a laser patterning. Process, which they claim will enable higher pixel densities up to 1000 ppi. Current smartphone panels max out at ~500 ppi. Poongwon Precision uses etching. Philoptics uses electro forming. DNP and Toppan of Japan use etching.
APS Materials’ laser patterning method includes the elongation of the iron plate and control of its thermal expansion. In addition to the basic process, APS will need inspection equipment and other equipment, which exceeds a capex of 100 billion won (US$88 million) will be needed for production. APS will first need to make FMMs that can be qualified by Samsung, which would enable Samsung to develop a transition plan to bring in a new FMM supplier. When Samsung contracts with another vendor besides DNP, DNP will likely need some type of compensation or lose its monopoly position. An individual FMM cost between $50K and $60K and there are 100 FMMs used for each panel design, which puts the SDC produces between 30 and 50 panel designs so the total revenue for FMM from Samsung is in the 100s of millions of dollars. Given that the Korean government is partially funding the program they may have some influence on Samsung and LG’s decision process.
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