Samsung spins off LCD business for OLED push

Slowing demand and increased competition lead to Samsung Display

20 Feb 2012
A samsung TV

Samsung has confirmed plans to spin off its LCD TV and monitor division into a distinct new company, Samsung Display.

Echoing its rival LG Electronics, which has been operating LG Display for its TV and monitor systems for quite some time, the secondary company will be formally launched on the 1st of April this year. "The spin-off will allow us to make quicker business decisions and respond to our clients' needs more swiftly", claimed Samsung's Donggun Park, current head of the company's LCD business unit and the man most likely to head up the spin-off company.

The new company will take control of all liquid-crystal display (LCD) products produced by the company. This includes standard and LED-backlit HDTVs, PC monitors and display panels for projectors, smarphones, cameras and tablets.

The move comes as consumer demand for LCD technology falls, while improved production methods and increased yields make it possible for companies to produce their own LCD panels quickly and easily. As a result, Samsung is seeing reduced demand and increased competition - a deadly combination.

The company won't be spinning off all of its display technologies, however: initial indications are that Samsung Display will concentrate on LCD-based technologies, while parent company Samsung will further develop its popular organic light-emitting diode (OLED) technology.

Currently used in the company's high-end smartphones, OLED panels offer several advantages over their LCD counterparts. As well as a lower power draw, an OLED display is thinner than an LCD while offering greatly increased brightness and contrast levels.

The cost and complexity of producing OLED panels has led to the technology being used only for small-scale devices like smartphones, however, but Samsung began showing off a 55in OLED HDTV at CES which it plans to launch commercially later this year. It's not the only one, however: rival LG announced a similar model of its own at the same show.

With Samsung betting heavily on OLED over LCD, the chances are good that its competitors will be watching closely to see if the gamble pays off.