Although Apple’s LED suppliers have always been mainly Japanese manufacturers such as Nichia, and Samsung has placed many of its LED orders with Sanan Optoelectronics in recent years, LG’s LED production is mostly entrusted to mainland Chinese manufacturers. Compared with mainland Chinese brand manufacturers, they are more active in supporting local suppliers. Overall, the LED supply chains of major brand manufacturers seem to be bound.
However, since Mini LED/Micro LED is still a very new technology, and the display and LED industries in Taiwan have been developing for decades and have a very solid foundation, they have a first-mover advantage in the early stages of new technology production. Therefore, it is not completely impossible to break into the supply chain of major brand manufacturers at this stage.
It is rumored that Apple may introduce Mini LED backlight design from iMAC in the second half of 2019. Although Nichia is still the main supplier of Mini LED in the early stage, if the new iPad and some sizes of MacBook, which are planned to be launched from the fourth quarter of 2020 to the first half of 2021, expand the use of Mini LED backlight technology, Taiwan's LED leader Epistar may have the opportunity to break into Apple's supply chain.
Founded in 1996, Epistar is currently one of the world's largest suppliers of LED epitaxy and LED chips. The company has been supplying Mini LEDs in small quantities since the second half of 2018, including red, green and blue RGB Mini LEDs that can be used in large display screens, as well as Mini LEDs used in e-sports monitors, mobile phones, and automotive lighting. In view of the future development of Mini LED and Micro LED, Yuanfeng New Technology, a 100%-owned subsidiary, has also been established to take charge of related businesses and hand over downstream packaging and module manufacturing to its strategic partner Weitian Technology, which is an active step.
It is worth noting that if Apple considers using LED suppliers other than Japanese manufacturers, in addition to Epistar, there are actually other manufacturers in Taiwan that have unique advantages in Mini LED and Micro LED, such as Hon Hai Group.
Hon Hai Group not only has a strong foundation in the field of downstream electronic assembly, but has also successfully integrated LED packaging, epitaxy/chips, and panel supply chains in recent years. Whether it is the development of Mini LED or Micro LED in backlight or active display, it requires a high degree of integration of LED and TFT panel/backplane technology, not to mention that Hon Hai is the main system assembly plant for Apple and many major brands.
In the long run, new technologies such as Mini LED and Micro LED need to be continuously improved and cost reduced before they can enter the mainstream consumer market. If we only focus on high-end application products, shipments will be small and costs will not be reduced. But the difficulty now is that many design links need to be fine-tuned, the production process also needs detailed improvements, and even equipment may require new capital expenditures.
Therefore, if major brand manufacturers or system manufacturers are willing to actively engage in supply chain integration, it will be a bonus for the entire supply chain and help accelerate the development of Mini LED and Micro LED technology. According to predictions, the penetration rate of Mini LED backlight may still be very low in 2019, and it may reach more than 10% after about 2023.
ANNA