Summary

October 2001 Issue Summary

A combination of factors has begun to take its toll on the fledgling microdisplay industry. A weak U.S. economy, which has almost certainly moved into recession following the September 11^th attack, a very tough capital market, product stretch-outs and manufacturing infrastructure challenges, have all conspired to put pressure on the entire industry. As a result, there have been layoffs at several U.S. based microdisplay companies including Hana Microdisplay, inViso, MicroDisplay Corporation, Displaytech and Zight.

While the reasons vary from company to company, many are pulling in their horns, laying off non-essential personnel, and trying to tighten up cash flow to get through the next 6-12 months. With so many players out there right now, some consolidation may well be in the cards. Digital Reflection has closed its doors.

These woes are not limited to the U.S. Japanese consumer electronics companies are suffering too and a glut of TFT-LCD production capacity is putting profit pressure on all display producers. Semiconductor chip production is in the dumps and could post the worst decline in 20 years.

On the other hand, JVC is betting big on LCOS technology and is talking about doubling manufacturing capacity to support a host of internal and OEM projection products. Seiko Epson has developed a new 1" direct-view LCOS panels and eMagin is expanding the capability of its OLED microdisplay to support stereoscopic images display. Meanwhile, polymer OLED developer, CDT, has signed a licensing deal with microdisplay developer, MicroEmissive, which will target the viewfinder market.

In addition, the manufacturing infrastructure continues to move forward as new packaging technology have been unveiled by Silicon Bandwidth and TLC International is developing lower cost slice-and-dice machines to aid in device manufacture. Taiwan’s Prokia is expanding production capacity for projection engines and new Chinese companies are popping up like wild flowers to make optical components, engines and finished products.

The home entertainment market is also starting to get more interesting as our visit to CEDIA revealed. Both LCD and DLP front projection systems are beginning to be fielded to compete with the mainstay: CRT projection systems. With contrast, black levels and color fidelity now rivaling CRT systems, especially some of the new DLP systems, a whole new market may be opening up. It is still too early to tell if the fixed-pixel projectors will overtake CRT systems, but if the image quality is there, with higher brightness at lower prices - what’s the problem?

The October issue of the Microdisplay Report has more details these and many other recent developments. We have also reorganized the format of the newsletter this month for easier reading and navigation. New categories include: Microdisplay Manufacturing, Microdisplay Devices, and Optics & Engines. Future editions of our Projection Industry Report will reflect these categories - with even more news stories and greater depth, as well as developments in lamp, screen and electronics technology (and full coverage of projection products).