LED manufacturers in Taiwan will face the problem of "backlight steering lighting" as a whole

"In the long term, lighting is the driving force for growth, and short-term depends on the backlight." Li Bingjie, chairman of the Taiwan Optoelectronics Semiconductor Industry Association, believes that the backlight market in the next year or two will gradually become saturated, growth is limited, and the lighting market can not really Being the next economic growth point is particularly critical. It is precisely because of this that Taiwan LED manufacturers may face the problem of how to “turn from backlighting to lighting”, and this transition is not only necessary for Taiwan, which is facing the dual competition between Europe, the United States, South Korea and the growing Chinese mainland. The current strategic reshaping and future choices in the new round of global competition.

In 2012, the LED lighting market has grown rapidly, but LEDs are still the largest application area for backlighting. In particular, the growth momentum of large-size LCD backlighting applications in LED mainly comes from the growth of LED backlighting of LCD TVs.

"In the long term, lighting is the driving force for growth, and in the short term it depends on the backlight." In this regard, Li Bingjie, chairman of the Taiwan Optoelectronics Semiconductor Industry Association and chairman of Epistar, believes that the backlight market will gradually become saturated in the next year or two. Growth is limited, and it is particularly critical that the lighting market can truly become the next economic growth point. It is precisely because of this that Taiwanese LED manufacturers may face the problem of how to “turn from backlighting to lighting” as a whole, and in particular, this transition is not only necessary for Taiwan, which is facing the dual competition between Europe, the United States, South Korea and the growing Chinese mainland. It is a strategic reshaping and future choice under the current new round of global background.

In the gap between the cross-strait LED industry cooperation and exchange conference held in 2012, the reporter interviewed Li Bingjie on topics such as “The Future of Backlighting and Lighting Market” and “How the Future Cross-Strait Enterprises Deepen Communication and Cooperation and Meet the Opportunities for the Semiconductor Lighting Market”. Sir, he believes that for cross-strait cooperation, “establishing an advanced model of deep cooperation is especially necessary. If we do not build this model in an effective period of time, the time left for us will be fleeting. ".

The growth of TV backlighting needs to be observed. Reporter: This year's backlight market is a hot spot. In the second quarter of this year, the LED backlight market recovered rapidly. Taiwanese companies have also reported full production capacity. Some Taiwanese companies have also entered many continents. The color of the power plant industrial chain, for the second half of the backlight market, what kind of view do you have?

Li Bingjie: On the whole, the sales of LED-backlit TVs are generally the peak season in the third and the four seasons. There will be a leading time for the supply of components. For European and American markets, it takes 3 from delivery to delivery. -4 months, including shipping time, time to enter the store, so if you want to catch Christmas sales, the chip must be shipped by the end of August; but due to the European debt crisis affecting the European market demand, we are on the European market this year The views are still somewhat conservative. The market demand in August and September and whether the industry will continue to perform at its peak season remain to be seen. As for the fourth quarter, it is generally off-season for chips, and it is even less clear now.

Actually, from the current status of full orders and production capacity, it may not be able to truly judge the situation in the third quarter. For example, the order received by the end of August will not tell you whether he will cut the bill in July. This was the case in June of last year. The other party urged the goods to be tight, and even sat in the company's meeting room. However, in late June, it was notified that it would not be shipped again in July. Therefore, orders are not guaranteed.

This is like the marketing industry has a “beer effect”. In the beginning of the game, retailers are optimistic about the beer market in order to pursue their best interests, and will continue to increase the number of orders; similarly, wholesalers will also try to maximize their interest to distributors. Increase orders. On the other hand, manufacturers will continue to increase their output under the stimulation of an increase in the number of orders. In the process, a large number of orders will accumulate. The market demand information is constantly being amplified in the process of passing from the retailer to the manufacturer. However, once the retailer arrives at the market and sees that the goods are not sold well, the rate of returning to the list is faster. So when the end market changes, upstream companies tend to get the latest news. When you know that it is already two months later, the more upstream the company is, the harder it will be.

Reporter: How to evaluate the market's demand for backlighting this year?

Li Bingjie: In fact, the sales of the “May 1st” in the mainland market this year are not very good. The overall economy of the mainland market has also experienced slower growth. Overall, the key to LED demand in September this year is still the mainland backlight market, because lighting is still difficult to become a key support for revenue. Therefore, the "Eleventh" and next year's Lunar New Year distribution benefits will become the key.

We should also be surprised to see that the recently introduced subsidy policy for energy-efficient home appliances in mainland China is surprising. From July 1, Skyworth, Konka, Hisense, and TCL all started to do the same thing: reduce the number of cold-cathode tubes and replace them with LEDs. If a government subsidizes 300 yuan for a TV and a TV is priced at around 3,000 yuan, that is a 10 percent subsidy. This is still a great deal. Maybe we can see that the mainland China TV market will take off very quickly in the second half of the year. .

Reporter: At present, domestic TV manufacturers have established a ratio of LED backlight penetration in 2012 that is more than 70% to 80%. There are also research institutes that the global penetration rate of backlit TVs in 2012 is still greatly increased. At the meeting, we see 80%. Do you think this? Is the number reasonable?

Li Bingjie: Will there be any growth in backlighting in the second half of the year? Now we can see that some organizations have expressed some optimistic views. But overall, I think the penetration rate of global LED TV backlighting has seen 6 to 7 percent this year. It is normal, 80% seems to be a bit of an exaggerated ingredient.

As for whether the promotion of energy-saving home appliance subsidies on the mainland market will bring new growth points for LED, I don't think it will be a global supply. Since the total actual demand for backlit television in mainland China is close to 50 million units, the difference between the 80% and 60% penetration rate will only increase by less than 10 million units, while the global market will exceed 200 million units, according to the penetration rate of this year. In terms of %, the figure is at least 130 million units. Even though the penetration rate of the Chinese mainland market reaches 80%, it only rises to 140 million units. As a whole, it has little impact on the fluctuation of the global market. However, it is still a great help for the free market (captive market).

Just to note that the mainland market's two subsidy actions in a very short period of time seem to have a sense of “fat food”. It is difficult to say whether it will bring pressure on the market afterwards. In fact, it is important to have a new house. Someone will buy new television, which is fundamentally related to the trend and prosperity of the mainland real estate market (at present, the mainland has been emphasizing the macro-control policy on real estate). Therefore, it is not enough to see that the government's subsidy to TV manufacturers is not comprehensive enough.

Reporter: So for the LED lighting market, how do you predict the economic conditions in the second half of the year?

Li Bingjie: In comparison, the market conditions of lighting will be different from that of the backlight market. The third quarter should be better than the second quarter. One reason is that in the winter, Europe and the United States have always been the time to replace lighting products. On October 1st, Looking forward to new listings, it is also possible to re-manufacture single orders and production, and it can be delivered before Christmas.

But overall, TV backlighting accounted for a large proportion of total revenue. Even if the lighting market grows high, if television drops by half, lighting will not be able to make up for it.

In the future, the concentration of industrial chains will increase. Reporter: At present, Taiwanese companies are adopting the horizontal division of labor model in the industrial chain. Many companies in the mainland adopt vertical integration. How do you view the evolution and development of these two models?

Li Bingjie: When it comes to the industrial chain, many people will ask which of the right is the vertical integration model and the horizontal division model. In Taiwan, many enterprises have a horizontal division of labor, while the mainland tends to adopt a vertical integration model. This is similar to mainland companies that are bigger and stronger first. Taiwan is stronger first and then gradually bigger. It seems that it is difficult to have a unified standard answer. .

Whether it is vertical integration or horizontal division of labor, which is related to the different development phases of the industry in which the company is located. In the initial stage of industrial development, if vertical integration is implemented, there should be a system of overall control over the industrial chain, perhaps introducing a faster one. Products that meet the application market and customer needs (vertical integration also requires companies to have more resources); however, in the mature period of industry, the horizontal division of labor will show its special competitiveness.

Not only that, which model is more advantageous, but also related to everyone’s understanding of the industry’s stage of development, thinking that industry will mature in the next two or three years, or that there are five or six years before it matures, holding two views The model adopted by people will also be different, and again, the location of each company is different.

Overall, I think that during the mature period of the industry, if vertical integration is the most likely way, production outsourcing (OEM) will go out and control over access will be the most important.

In addition, according to the division of labor of the industry chain, the current industry division of labor is too detailed. From the substrate and the extension to the chips, packages, modules, and lamps, the industrial chain looks very long, but the future division of labor can no longer be cut so Fine, it may eventually be integrated in two or three nodes, and the degree of concentration of the industry chain will increase.

The cross-strait cooperation and creation of a brand is the best choice for reporters: The ongoing cross-strait industrial cooperation and exchange conference has attracted much attention from the industry. The meeting also reached some cooperation intentions and pilot plans. In your opinion, cross-strait cooperation Should be more focused on what level? Can you talk about some in-depth ideas or suggestions?

Li Bingjie: The expansion of the mainland’s pilot project will at least promote the realization of common cross-strait relations in terms of standards and testing.

I believe that the common standard and test of LED across the Taiwan Strait will help Taiwanese LED industry providers to provide mainland customers with product testing and standards-compliant products. This is an important foundation. In terms of standard inspections, if the two sides of the strait can achieve commonality in terms of standards and interface specifications, it will be possible to become the same market standard as Zhaga, making the development of cross-strait enterprises more competitive. Like the current US energy star proposal test time is more than 6,000 hours, and even recommended testing 10,000 hours, testing time is very long, few cross-strait companies can pass through in a few years, and if the two banks can promote common test specifications faster, there will be This may change the unfair competitive environment that Chinese companies are currently in.

As for how the cross-strait cooperation will become more in-depth and substantive in the future, as the Deputy Secretary-General of the Alliance (CSA) Yu Jun mentioned in the conference report: Cross-Strait cooperation has basic consensus and goals, but specific practices are still being explored. .

We should see that LED lighting is a great market opportunity. If we can really combine the technical power, productivity, and market of both sides of the Taiwan Strait, we will play a greater role. This co-created “Chinese flagship brand” will also be more effective. I hope to go global; and what we call the Chinese brand, I think a certain level can be a "joint venture" form, how to use an industrial cooperation model to link the advantages of the two sides' capital, technology and market is Worth exploring. Regardless of short-term cooperation in standards and certifications, or common technological innovation in the medium term, or long-term goal of creating a brand, I believe this is a subject that is worth deepening continuously.

Of course, it takes a very long time to establish a brand. The establishment of a deep cooperation model is also difficult for the government to dominate under today’s free economy. It seems that it still needs time. However, we must also realize that if we do not construct the model first in an effective period of time, the time will pass and the opportunity left by history will be fleeting.

Reporter: There is currently a point of view in the industry that there are formerly European, American, and South Korean companies, and there are growing Chinese enterprises afterwards. Taiwan’s influence in such an attack may be diminished. What do you think about this? the opinion of? How to consider the future of Taiwan's LED industry as a whole?

Li Bingjie: According to the current situation, I think Taiwan has a small gap in technical level from some international companies such as Crayon and Nichia Japan, but in terms of patents, they have a stronger patent status. In terms of technology and production capacity, I think the backwardness gap in Taiwan is limited. In the face of Korea, such as Samsung, Taiwan can compete with Taiwan in terms of technology and production. Samsung's mass production advantages of TV backlighting and its market share in the lighting industry are tactics that are extremely threatening to Taiwan and even European and American manufacturers. .

Of course, we also see that mainland companies are also catching up. The Deputy Secretary-General of the Coalition (CSA), Jun Jun, also introduced in the morning's cross-strait exchange meeting that the mainland's LED technology has been catching up with international companies for almost 2 years and is now able to supply 130lm. /W LED lighting package components, this figure seems to be very good, but for enterprises, the long-term stable production capacity and management is equally important. In fact, to a certain extent, the technological advancement of the mainland cannot but be said to be related to the flow of large numbers of Taiwanese talents to the mainland.

What we need to think more deeply at the same time is what kind of form an industry needs to complete in order to develop smoothly. For example, the talents that flow from Taiwan now are mostly repeating old technologies and are making up for the vacuum. At the same time, there are also shortages of talents in mainland engineering. For example, 600 MOCVD will be started and the number of engineers working on the stoves will be very high. Limited, all people can only be on the production line, and no one is going to engage in research and development. This state will pose a potential crisis for Taiwan or the mainland. What we least want to see is that Japan and the United States and Europe will Therefore, once again surpassing, we have developed weakly due to internal competition within ourselves, and have once again become a processing plant of an international big factory, continuing the fate of OEMs for others. Therefore, I think cross-strait cooperation is necessary today. Very urgent.

Reporter: At present, there are more than 300 MOCVD machines in the Epistar Group, but it is reported that Jingyuan Optoelectronics will once again expand its production and the investment amount exceeds NT$5 billion. What kind of consideration is this?

Li Bingjie: If LED lighting reaches a peak in 2018, the entire market will need about 3,000 MOCVD machines. Jingyuan Optoelectronics will grab the top 3 in the world, and at least 15% of the market share, then Jingyuan Optoelectronics will In the next few years, we will move toward this goal. However, if the technology is advanced and the total global demand only requires 2,000 units, then the purchase of new equipment will only replace the depreciated old equipment. Just like this year, Epistar has also purchased a lot of new MOCVD equipment. Therefore, next year's investment is not a major expansion of production, the amount has not yet been determined.