Abstract

Industry's Efforts to Take Lead in New Technology Trends Should Be Support by Government Policy

There is a definite trend among thin-film touch panel makers to adopt substitute materials for ITO. As one of the goals of using these substitute materials is reducing costs, several issues that plagued the industry when ITO was used should be avoided, particularly in the situation whereby upstream material supply was controlled by foreign companies. This is what happened in Taiwan and thus Taiwanese thin-film touch panel makers have to consider whether it is possible to gain control over upstream supply sources in this period of change.

Looking at Taiwan's development of these substitute materials, even though Taiwan has made patent applications for graphene and Ag wire, the number of these applications is relatively low and mainly come from the academic sector. Based on interviews with Taiwanese academics, it can conclude that Taiwan does indeed have the R&D capabilities and human resources to develop graphene transparent electrodes. However, Taiwan is currently still in the initial R&D phase, and more investments in mass production technologies are needed if Taiwan is to achieve commercialization of this material. Collaborative efforts by Taiwanese enterprises will be essential in this regard, in particular efforts aimed at increasing capital investments and defining mass production specifications.

However, most Taiwanese enterprises are small and medium-sized companies that are not in a position to take significant risks. Instead, they prefer to adopt a conservative approach when it comes to developing new technologies, which causes them to miss opportunities to take the lead in these new technology fields. In addition, the large number of substitute materials makes it difficult for companies to become a market leader and increases investment risks. It is suggested that, led by government initiatives, upstream, midstream and downstream companies come together to jointly formulate relevant strategies, thereby making sure that upstream and downstream makers share the same objectives in product development. Upstream makers can lower the risk of making wrong investments, while downstream companies can fully focus on the design of new products without having to worry about supply problems. At the same time, an exchange platform bringing together academia and enterprises has to be established. This will allow academic institutions and research organizations to concentrate their R&D capabilities for substitute materials, thereby avoiding waste and shortening the timeframe in which commercialization can be achieved. Private-sector enterprises can also consider importing mass production technologies to Taiwan through mergers and acquisitions, thereby accelerating industry development.

Thin-Film Touch Panel Makers Can Overcome Industry Challenges through Collaborative Approach

With a large number of technologies on the market and demand constantly changing, doing at it alone will not be a viable option in dealing with the increasingly fierce market competition. Besides enhancing their own cost and technology competitiveness through improvements in yields and investments in substitute materials, thin-film touch panel makers also have to consider a collaborative approach.

For example, as branded vendors decide what components will be used in their products, thin-film touch panel makers can consider setting up strategic alliances with branded vendors to increase their downstream partnerships. This can be done through stock purchases and defining common goals. Also, cooperation can be established with touch IC makers, as touch ICs can supplement insufficiencies of thin-film touch panels. In particular, now that the thin-film touch panel industry is switching to other transparent conducive materials, touch IC panel makers also have to adjust to new materials. Through joint development and alliances, both sides can quickly create differentiation to enter the market. Another option for thin-film touch panel makers is to merge with glass touch panel makers. By using their respective technological advantages, they can jointly enter target markets and take the advantage of sales opportunities, to help overcome the challenges that are now confronting the thin-film touch panel industry.

Nevertheless, with the declining market share of G/G touch screens resulted from their incapability to tap demand for lightweight design, the share of global smartphones with touch screens featured thin-film projected capacitive touch technology is estimated to continue to rise further in 2013. The share among tablets, in particular, is expected to top over 75% in 2013 in anticipation of growing demand for value-line tablets. Nowadays, thin-film projected capacitive touch technology remains mainstream in value-line tablet and smartphones. However, as the suppliers of glass-type touch panels have low-cost solutions available to compete with film-type touch panel counterparts, whether there will be any variation in the adoption share of film-type touch panels will depend on the market acceptance of those low-cost glass-type touch panel solutions.

Appendix

Glossary of Terms

List of Companies