The application of Mini LED backlight technology is expected to reach 18% penetration rate in the overall market for IT products in 2025...
According to the latest report by the LEDinside research division of TrendForce, titled 2020 Mini LED Next-Generation Display Technology and Supply Chain Analysis, as Apple pushes forward the development of Mini LED backlight technology, the company is expected to incorporate Mini LED backlight technology to improve the performance its existing products such as the iPad and Pro Display. The application of Mini LED backlight technology is expected to reach 18% penetration rate in the overall market for IT products in 2025.
TrendForce Assistant Research Manager Max Chen indicates that LED companies are currently in the process of CAPEX expansion. For instance, the Mini LED chip production capacity in the Taiwanese market is expected to reach more than 10 billion chips per month by the end of the year. The massive expansion of the LED industry has also stimulated a corresponding surge in the peripherals market, which benefits both existing and newly developed LED process equipment.
The Taiwanese Mini LED supply chain can be examined in terms of three segments: LED light source, equipment/process, and components. With regards to the LED light source segment, LED chip suppliers include Epistar, Lextar, and EPILEDS. Some LED package suppliers, such as Everlight, Harvatek, and AOT, are aiming to enter the Mini LED backlight market by leveraging their existing die bonding production lines or providing Mini LED packages.
With regards to the equipment and process segment, due to the high variance in specifications such as wavelength and other electrical characteristics in LED epitaxy production, suppliers must rely on extensive testing and sorting processes to ensure that the LED chips produced have a high degree of consistency. In addition, given the sharply rising demand for Mini LED chips, suppliers’ testing and sorting capacities have become critically important. At the moment, the primary Taiwan-based suppliers of testing and sorting equipment are FitTech, Saultech, and YTEC. In particular, FitTech has built a reputation of producing highly accurate equipment, in turn attracting OEM orders from Mini LED chip suppliers. FitTech occupies more than 80% share in the Mini LED testing and sorting market in Taiwan. As well, since the Mini LED die bonding process requires equipment with high speed and high accuracy, surface-mount technology solutions provider TSMT has procured high-speed die attach equipment from Kulicke & Soffa in response to large-scale, high-spec OEM orders from Apple.
With regards to the LED component segment, representative backplane suppliers include Uniflex and Unimicron, while light source driver IC suppliers include Parade, Novatek, and Macroblock. The primary light source module houses are Radiant and Qisda. Although these components have existed since the traditional LED backlight era, the rise of Mini LED backlight technology means clients are placing a higher demand on both component cost and technical specifications, in turn creating new challenges and opportunities in the LED component market.
Nonetheless, the current worldwide pandemic situation means future developments in the market for end devices remain highly uncertain. Brands are therefore looking to increase their R&D spending to improve their product specifications, in turn incentivizing the public’s willingness to purchase. At the same time, brands’ R&D efforts may also prompt midstream and upstream vendors in the Mini LED supply chain to upgrade their current technology and seek continual technical breakthroughs in order to meet the brands’ demand for new product developments.