Americans Firstly Invented the Liquid Crystal Display (LCD), But Why did They Give away the Large Market to Japan? (Link) The Japanese liquid crystal display industry boomed in the mid-1990s, which accounted for 95% of the global market share.
But the world changes so fast. Not many years later, the Japanese industry declined. Today, I can only use the word "collapsed" to describe the Japanese liquid crystal industry.
In 2016, Foxconn, owned by Terry Gou, purchased the Japanese company Sharp, which is a hallmark event.Now, only two Japanese companies continue producing LCDs. Currently, the world liquid crystal industry is just the competition between Japan and South Korea. Japan is almost knocked out.
Then, how did South Korean people defeated the Japanese?
In 1983, the Japanese company SEIKO launched the 2-inch color LCD. The size was too small to be used on televisions. It can hardly be used in other areas too. If LCD wanted to be used in large scale, bigger sizes are needed. Therefore, the first-generation LCDs produced by Japanese companies were 8-inch or 9-inch large, about the size of an iPad.
In 1992, IBM launched the ThinkPad laptop series, which became very famous later. Its first product, 700C, adopted the 10.4-inch color LCD. Laptop was the first killer application of LCD and LCD market was immediately ignited. In response to the market demands, many Japanese companies, including Sharp, NEC and Foxconn, built their second-generation LCD production lines to produce laptop screens.
How do we divide LCD into generations? We mainly refer to the size of the LCD after being cut. The competition between companies in the liquid crystal industry can be simply understood as the competition to build new-generation LCD production lines with bigger display sizes.
Since the liquid crystal industry was divided by generation, a unique "liquid crystal cycle" was created.
When LCD of a certain size entered the market to satisfy certain market demands, e.g. laptop display, the enterprise revenue would grow dramatically. So other companies would follow and produce LCDs of the same size. Soon production surpassed consumption and the price decreased a lot. Each vendor's revenue dropped sharply and some vendors even faced losses.
Although vendors faced losses, the price of LCD kept decreasing. As a result, the application of LCD expanded and more users started to use LCDs. The increased consumption later led to undercapacity and prices went up. So enterprises again expanded their production. Then supply exceeded demands. Priced went down and company faced losses again.
It seems that the supply and demand changes are just the same as general commodities. It's not true. The liquid crystal industry is special because LCDs are used in more and more areas.
If the liquid crystal display is expensive, it can only be applied to high-end areas, such as cockpits of fight planes or high-end laptops. Common people will not consider that. But if the price of LCD substantially reduces, many new demands emerge. For example, common users like us also replaced CRTs with LCDs, which happened just few years ago.
The problem is: Production and revenue are not increased stably, but by leaps and bounds. Every leap represents a liquid crystal period. Companies need to bend their keens (withstand the losses in the period) and insist on investing in the next-generation production line. Only by doing so can they make a jump (increase production and revenue).
Liquid crystal producers in Japan once almost monopolized the global market. However, they didn't understand such a special rule and change their competition modes accordingly. As a result, they left great opportunities to Korean companies.
In 1993 and 1994, LCD production entered the first period of price and revenue decrease. Due to losses and decreased production, many Japanese engineers in the liquid crystal industry lost their jobs.
Samsung Group sized this opportunity and opened research institutions in Japan. Samsung recruited engineers who lost their jobs and started producing LCDs. In 1995, Samsung and LG both built their LCD production lines.
After South Korean companies entered the liquid crystal industry, countercyclical investment became their most powerful weapon. The liquid crystal industry bounced back in 1994. However, in 1995 and 1996, the industry entered another period of declining. Facing huge losses, unlike Japanese companies, South Korean companies didn't decrease their production to maintain the price. Instead, they invested more and expanded their production.
The investment of liquid crystal industry is incredibly large. If we calculated by RMB, the investment is up to billions or even tens of billions. With such unprecedented and aggressive investment strategy, South Korean companies defeated Japanese counterparts.
Regarding South Korean companies' crazy investment strategy, the Japanese didn't take it seriously at first. An executive from a large Japanese company once said in a sarcastic tone that the fifth-generation production line invested by South Korean companies is doomed to be another Titanic, which would sink after setting sail. The Japanese thought that their third and fourth generation production lines had already exceeded demands. Why don't they decrease production to maintain the price? It seemed unreasonable for the South Koreans to invest more in producing LCDs with larger sizes.
However, it was the fifth-generation production line that helped South Koreans to defeat Japanese companies. LCDs produced before the fifth-generation production line can satisfy the need of 14-inch laptops. It seemed unnecessary to produce larger displays for laptops. Japanese even thought that the fifth-generation production line was the physical limit of liquid crystal industry.
But the special rule in the liquid crystal industry—Production Creates Demands—played its role.
The fifth-generation production line could produce 26-inch displays. Indeed, no one would use laptops with such large screens. But the displays produced by the fifth-generation production line enables consumers to replace CRTs on their desktops with LCDs.In addition, flat-screen TVs that consumers had been long waiting for started being produced. At that time, the sizes of flat-screen TVs are not too large, but a new market was developed.
In 2001, Samsung and LG gritted their teeth to invest the fifth-generation production line. After the fifth-generation production line was put into production, South Korean companies surpassed Japanese companies such as Sharp. The market share of Samsung and LG ranked the first and second in the global market. Only till then Japanese people realized the reality. Sharp had to abandon its conservative attitude to directly invest in the sixth-generation production line, which could produce even larger LCDs than the fifth-generation production line.
But if you once fall behind, you will always fall behind. In 21st century, while South Korean companies outstood, the liquid crystal industry in Taiwan also boomed. Facing competitors from the two regions, Japanese companies gradually lost the match.
Previously, the Japanese caught up and defeated Americans to monopolize the liquid crystal market with their own strategy—start from small sizes and keep profitable. Then the Japanese invested in R&D to help the industry become mature. However, because of their small landscape, Japanese companies didn't dare to invest money as "crazy" as South Korean companies.
Therefore, South Korean people defeated the Japanese in this area not because of advanced technology, but a brand new investment strategy.
Times changed and the strategy changed as well. Japanese people didn't keep up with the times because they made a strategic mistake.
What we need to learn is that the organisation must focus on strategy considering the current scenario, Future economic development trends, changes in consumer habbits etc.
Investment or Technology or marketing alone cannot guarantee organisation survival in long run. Right strategy and execution at right time is the key. While executing the strategy one need to keep sentiments (like attachment to product, attachment to specific market, attchment to specific industry etc.) away and execute the decided strategy measures fast.
And the bees bullfighting, China's iron and steel/ Nonferrous metals, shipbuilding, white, mobile phones, LCD, and high-speed railway, and solar power. .... .. how you play dead from other countries.
Developed countries grinder, langdexuming.
The industrial transference is an irresistible trend, and also with the state at the same time./ Consortium related investment will.
But none of key technology products put control is succeed! It was only yesterday that see, the global semiconductor chips, the best lithography from a Dutch company.
The company also raised concerns over China embargo.
China damianrshang up now, but these key components, shut off key technology at least20 It takes years to catch up.
But having said that, if I could catch up, the world's developed countries are almost all dried dead.
Industrial transfer usually low-end industries, LCD with not low-end industries, liquid crystal display (LCD) are at the top of the world's neck with Samsung card, such as Porsche.
It is one of the core technology of,AMOLED vacuum evaporation and equipment manufacturing technology is Japan vendor master, and Samsung. You can search for Canon Tokki coater
# Fun heart. Porsche screen liquid crystal? That's funny, right! .
@ 345 up the hill tiger Huawei P10 Porsche
@ 345 up the hill tiger Is not that right? I'm talking about LCD industry the categories, including LCD (TFT, IPS, SLCD) and OLED (AMOLED, Super AMOLED), Samsung master core is AMOLED technology, Porsche with is AMOLED.
Japan has the upstream component Relationship between key technology, but as long as it's not exclusive monopoly, Nothing, really.X Use.
South Korea's LCD basic is overwhelming, Japan upstream manufacturer: your hand which off key technology, only the best customer, If I don't sell to him, I am afraid that first fail you.
Similarly available resentment so-called on China's chip embargo, consumed in China in chip for worldwide every year trading90% The upper and lower