In-depth Analysis: Key Component Industry Trends of Touch Screen Panel - ITO Film

Abstract

2009 ITO Film Market is Projected to Grow 23% Y-o-Y to JPY 35.5 Billion

As the touch screen panel (TSP) market expands focused in the mobile phone, a required TSP component, ITO film market is projected to record JPY 35.5 billion in 2009 for the market size that has grown 23% Y-o-Y. Displaybank noted through the newly updated "Touch Screen Panel Key Component Industry Trend - ITO Film" Report that the TSP-use ITO film market is expected to maintain approximately 20% growth rate and is projected to record 22% CAGR by 2013.

The ITO film refers to an ITO (Indium Tin Oxide) filmed on a PET film. The ITO, a main material of the ITO film, is transparent and reports good conductivity that it is widely used in various displays such as touch panel and LCD. It requires an advanced technology in order to progress filming on top of a thin and soft film since the ITO is a metal. Accordingly, most of demands in Korea have been dependent on Japanese products.

As recently TSP-use ITO Film demands have been continuously shown upward trend, localization trend of ITO Film have been accelerated. Korea ITO film production capacity for the year 2008 has grown 48% Y/Y and Displaybank projects Korea' s ITO film production capacity to sharply rise 32% Y/Y for the year 2009 as well.

Displaybank' s analyst, Jennifer Lee notes "ITO film market for the year 2007 has experienced supply shortage that was unheard of. It was because Korea' s touch screen panel production capacity was only 5% of the global market at that time. Korea underwent severe ITO film supply deficit compared to other regions and through this and Korea recorded a large number of new companies entering into the ITO film market."

Lee added leading set makers such as Samsung Electronics and LG Electronics are located in Korea such that Korea is emerging for the new point of demand with respect to the ITO film as the TSP makers located in Korea radically expanded in mid to late 2007.

However, the structure of mobile-use touch screen panel, which leads the touch screen panel market, is changing from a film type to a glass type and a large number of makers have newly entered domestic and overseas markets to increase a feasibility of the over-supply phenomenon, which results in a large production capacity leftover compared to the demand. Lee emphasized now is the time to "choose" and "focus".

Key points are expected to include ITO film development for an exclusive electric capacity use, which has not yet been standardized, ITO film development for targeted few makers, and ITO development with outstanding properties regarding few selected applications in order to differentiate product developments from the other makers.