OLED TVs are hot at CES, but are nothing more than a technological pipe dream

One of the big announcements in the pre-CES blit krieg of news releases has been LG’s announcement that it’ll demonstrate a 55-inch OLED television at the electronics expo that kicks off on January 8. Like Santa, large-scale OLED TVs show up at the same time of year to tantali e us with dreams of better display technology — and much like the jolly old elf, the real-world existence of these products remains unproven.

Organic Light-Emitting Diode (OLED) displays have been tantali ing consumers and manufacturers since the early 2000s (though they were originally invented by Kodak in 1979!) OLED screens require no backlight and are therefore thinner, lighter, and capable of superior color reproduction compared to LCDs. OLED displays typically draw 25-40 percent less power than their LCD counterparts (this varies depending on the amount of white light on screen), offer excellent viewing angles, and have a much faster refresh rate. The technology can be used to create flexible displays (try that with your 27″ LCD) and to produce high-efficiency, ultra-thin lighting panels.

Unfortunately, LG’s “breakthrough” appears to be more of the same Real Soon Now rhetoric we’ve been hearing for the past seven years. Even if the company brings this 55″ titan to market — and thus far, LG has only coyly stated that it “may” be available by Q4 2012 — it wouldn’t be a turning point in OLED’s readiness for the mainstream market. The problems that have kept OLED tech out of mainstream panels to date, such as short diode lifespans (particularly a problem for blue OLEDs), high manufacturing costs, and the potential for screen burn-in continue to stymie attempts to increase panel si es.

LCD operating profit margins have tumbled since 2003. OLED panels, if they were possible to manufacture, would help reverse the trend.

The continually falling price of HDTVs is another problem. In 2005, the year OLED displays started attracting major interest, 32″ HDTVs still ran between $1100-$1700 depending on features and display type. Today, basic 1080p 32-inch displays can be had for $350 or less. Rapidly declining prices make it difficult for OLED displays to bridge the gap; the manufacturing technology improvements that are driving down the cost of LCD panels aren’t the same as the costs OLED manufacturers are struggling to contain.

Product positioning is also more difficult. The difference in image quality between HDTV and standard-definition was immediately obvious to everyone the first time they saw it. OLEDs do offer a number of fidelity improvements compared to current technology, but they’re not typically as jaw-dropping as the gap between a standard definition TV and even a 720p screen.

Ongoing economic uncertainty in the US and Europe also makes any attempt to launch a high-end luxury display dicey. DisplayWatch thinks the 55-inch LG television mentioned above would go for at least $8,000; conventional 55-inch displays can currently be found for just a tenth of that. If the likes of LG and Samsung thought they’d solved the problems facing OLEDs, we wouldn’t see a 55-inch set or two, but a legion of displays from 24-46 inches with model numbers and firm shipping dates.

Power consumption between AMOLED and LCD devices from circa 2008. Performance on both fronts should have improved but the relative comparison is solid.

A better way to judge the maturity of OLED technology is to examine how the tech has been used in mobile phones. Here, the data is more positive. The first phone to feature an OLED display was the BenQ-Siemens S88 in 2006. It offered a 2-inch, 176×220 pixel screen. Samsung’s first AMOLED device, the Omnia i910, featured a 3.2-inch 240×400 pixel display and debuted in December 2008.

Since then, things have accelerated. The Samsung Galaxy S (launched in June, 2010) offered a 4-inch display with a resolution of 800×480 and was capable of displaying some 16 million colors. Current top honors goes to either the Samsung Galaxy Nexus (4.65-inch @ 720×1280) or the PlayStation Vita (larger screen, 960×544 resolution). Samsung’s upcoming Galaxy Tab 7.7 will use the largest AMOLED to date (7″, natch), but retains a 1280×800 resolution.

Samsung is reportedly adopting laser induced thermal imaging (LITI) as a deposition method rather than the company’s current fine metal mesh technology, which should theoretically allow it to produce larger panels more easily. This shift, combined with the company’s focus on 8th-generation AMOLED product lines, has led some analysts to claim that the leap to large panel si es is once more right around the corner.

We disagree. AMOLED’s maximum screen si e and general characteristics should continue to improve over the next few years, but mainstream products are at least three years away. As the chart above shows, there’s an order of magnitude difference between the number of panels in use for handsets and those for televisions, despite the fact that handset sales are booming. That fact alone makes it extremely difficult for OLED manufacturers to create anything like the economies of scale that exist around LCD production.

The biggest single reason to think OLEDs are years away is also the simplest: panel vendors are desperate for new, high-margin hardware. This is all the more true in the wake of 3D TV’s failure to catch in the mass market; the company that solves the OLED scaling problem first is going to make billions of dollars for itself. Samsung’s move to LITI is a decision the company was considering as far back as four years ago; it may help solve some issues, but it doesn’t redefine the problem.

Nothing would make me happier than to be proved wrong by mass market televisions shipping in a year or two — but for now, they’re just a pipe dream.

OLED TVs are hot at CES, but are nothing more than a technological pipe dream