OLED Materials Markets: 2015-2022: Momentum and Opportunities

n-tech Research Report
OLED Materials Markets: 2015-2022:
Momentum and Opportunities
Issue date: June 22, 2015
Report number: Nano-833
n-tech Research PO Box 3840 Glen Allen, VA 23058
Phone: 804-938-0030
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OLED Materials Markets: 2015–2022: Momentum and Opportunities
Report Description
n-tech has covered the OLED materials space for eight years, and we have
watched expectations for this market swing backwards and forwards. For the
moment there seems to be rising demand for OLED phones and tablets, but
the short-term picture remains uncertain for OLED lighting and OLED TV
panels. An old debate that shows no sign of going away is whether OLED
materials can be effectively solution-processed. New issues are emerging
and will help shape the OLED materials business, such as being “green” and
avoiding rare and costly materials in what are often price-sensitive markets.
Perhaps the most interesting aspect of the OLED materials market is how
the structure of the industry is changing. With all the uncertainties and
captive markets, do newer companies in this space stand a chance? What
will happen to the established suppliers in Japan who have been around
since the days when “OLED” meant PM OLED?
This new report provides answers to all these questions. As with all n-tech
reports, we include detailed volume and revenue forecasts, broken out by
application, material type, functionality, and deposition method. We also
examine the core strategies of leading players in the OLED materials space.
TABLE OF CONTENTS
Executive Summary
E.1 Changes in the OLED Materials Market in the Past Year
E.1.1 Technology Changes and Issues to Solve
E.1.2 Market and Supply Chain Changes
E.2 Are There Still Market Opportunities in the OLED Materials Space?
E.3 Key Companies to Watch
E.4 Summary of Eight-Year Forecasts for OLED Materials
Chapter One: Introduction
1.1 Background to this Report
1.2 Objective and Scope of this Report
1.3 Plan of this Report
Chapter Two: Markets for OLED Materials: Awaiting News on TVs and Lighting
2.1 Small and Medium Displays: A Reliable Market for OLED Materials
2.2 What OLED TV’s Success Would Mean for the OLED Materials Business
2.3 OLED Materials and the Future of OLED Lighting
2.4 Automotive OLED Lighting: What Materials Should Expect
2.5 Will Wearables be the Next Market for OLEDs? Implications for OLED Materials
2.6 Key Points from this Chapter

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Chapter Three: Trends Shaping the OLED Materials Market
3.1 New Trends in the Emissive Layer: Commercial Implications
3.1.1 Blue: The Neverending Story
3.2 Other Trends in the OLED Stack: Commercial Implications for Materials
3.3 Eliminating Iridium and Other Environmental Issues
3.4 Flexible OLEDs are Real: So What is the Future of Encapsulation?
3.5 Will Ever OLEDs Move Past ITO?
3.6 Solution Processing for OLEDs: If Not Now When?
Chapter Four: Evolution of the OLED Supply Chain
4.1 The Future of Traditional Japanese OLED Materials Suppliers
4.2 UDC in Next Decade
4.3 The Samsung Materials Supply Chain
4.3.1 A New Role for Novaled
4.4 The LG Materials Supply Chain
4.5 If Apple Goes OLED Who Will Supply Its Materials?
4.6 Can OLED Materials Startups Succeed?
4.7 China Changes Everything
Chapter Five: OLED Materials and Market Forecasts
5.1 Forecasting Methodology and Assumptions
5.1.1 Changes from Last Year's Forecast
5.1.2 Pricing Assumptions
5.1.3 General Economic Assumptions
5.2 Panel Area Forecasts for OLED Panels by Application: Displays and Lighting
5.3 Eight-Year Forecasts of OLED Emissive Layer Materials
5.4 Eight-Year Forecasts of Electron Transport Materials
5.5 Eight-Year Forecasts of Hole Transport, Hole Blocking, and Electron Blocking
Materials
5.6 Eight-Year Forecasts of Hole Injection Layer Materials
5.7 Eight-Year Forecasts of Electrode Materials in OLEDs
5.8 Eight-Year Forecasts of OLED Encapsulation
5.9 Eight-Year Forecasts of Substrates in OLEDs
5.10 Summary of Eight-Year Forecasts of OLED Materials
5.10.1 Breakout by type of manufacturing
Related Reports:
OLED Lighting 2015-2022: Reassessing Markets and Momentum
OLED Materials Markets – 2014

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Chapter One: Introduction
1.1 Background to this Report
n-tech has provided coverage of the OLED materials space for eight years. We have
watched expectations for this market swing forwards and backwards, in step with back-
and-forth projections for the broader market for OLED panels.
Current emitters generally provide good enough performance for both displays and
lighting, though of course longer lifetimes and improved color profiles would always be
better. Presumably these could command premium pricing, helping offset the continued
pricing pressures on OLED materials. The exception remains blue emitters, as usual,
and the search for a better (deeper) blue emitter continues.
This year we are seeing many of the same trends that we have seen before but with
some positive developments on the addressable market front (wearables and fewer
uncertainties about the OLED lighting market), and the emergence of new technical
trends in materials that are often appearing from smaller firms that are not yet big
names in the OLED business.
1.1.1 Addressable Markets for OLED Materials Expand
The past eighteen months has seen the addressable markets for OLED materials
expand as the OLED trend outside of the established Samsung phones has expanded.
Tablets with OLEDs are showing up too, from Samsung and from others using
Samsung panels (Dell). In the near future we expect new suppliers of OLED devices –
and OLED materials – to emerge out of China.
Wearables: More interestingly, wearable devices with OLEDs are emerging, primarily
smart watches. Large volumes of them would spell good news for OLED materials, but
that's far from certain—though having the iWatch use an OLED is an encouraging sign.
Although materials use by individual wearable devices is tiny, volume shipments of
these devices could eventually be huge. Important to remember that not all wearables
need a display – but smart watches and smart glasses do. Recent estimates suggest
somewhere just under 5 million shipments for all smart watches in 2014, with added
speculation of as many as 15 million iWatch shipments in 2015.
For now, OLED-based wearables are a tiny market in volume terms and the size of the
displays is very small. However, the volumes may increase dramatically over the next
few years. There is at least a chance that wearables may provide a significant
opportunity for the OLED materials sector going forward. And it is the only addressable
market for OLED materials that is genuinely new.

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Lighting: Meanwhile, the OLED lighting sector is seeing some stability, although the
once high hopes for OLED-based general illumination have cooled.
Some recent highlights from the OLED lighting front include LG Chem beginning mass
production of large (320x320mm) OLED lighting panels and Konica Minolta successfully
deploying the largest OLED lighting installation, a massive 15,000 panel project at a
Japanese tulip festival. OLED lights are now available at Home Depot and both BMW
and Audi are planning OLED lighting in new cars within the next 18 months
All this suggests to n-tech Research that there is enough opportunity in OLED lighting
for OLED materials makers to treat it seriously. While better yields and production
processes are frequently cited as the main areas of focus, there are contributions that
can come from the materials side as well. One is emitters optimized for lighting, since
the requirements for OLED lighting can be significantly different for what is needed for
displays.
TVs: We are less certain about the OLED TV business. If it takes off, then it will
consume large amounts of OLED materials. Prices for these very expensive displays
are coming down, but no one can yet be sure whether OLED TVs will be able to
compete with LCD TVs. If OLED TVs eventually follow plasma displays into oblivion, it
would not be a huge shock to many in the TV business.
Nonetheless, we think that there is an incentive to work with LG (and eventually
Samsung) to supply materials for OLED TVs that can help improve yields and lower
costs, with longer lifetimes, better color fidelity, and thinner profiles. Note: LG's OLED
TVs use a white emitter and color filter, while Samsung has focused on "true" RGB
OLED. This debate has yet to be settled, whether the latter has shown enough
improvements to be ready for TVs.
1.1.2 Solution Processing, The Siren Song
Another old debate in the OLED materials space that shows no sign of going away is
whether OLED materials can be effectively solution-processed. For about fifteen years
this was supposed to be the way that OLEDs were going to make it to a price
performance level that would allow them to reach a highly attractive price/performance
ratio; but this has yet to happen and the debate goes on.
Some believe solution-based processes and R2R need to be brought along more
quickly. Supporters of solution processing have always cited flexible panels as one
justification, but for the first time flexible and curved OLED displays are actually a
market reality. Advantage, solution-processing. Names to watch here include Kateeva,
Seiko Epson, DuPont, and Mitsubishi.

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But not everyone thinks a move to solution-based processing is necessary. It would
lower capital equipment costs, for sure, but those would be mitigated by more costs on
the component side, so the argument goes. Moreover, there is also an argument that
TAKT times are impacted by solvent drying times. Better to focus on improving yields
and TAKT times in vacuum-based processes, or so it is argued by some.
Incidentally, it is not just the organic stack that is part of this story. Truly flexible displays
would not be able to use ITO (although curved ones can), so solution-processed
transparent conductors for OLEDs would get a boost from the shift to flexibility.
1.2.2 Finding Room to Maneuver: Three's Company
UDC has a dominant position in phosphorescent emitters, and has secured new
partnerships to try and extend its position even further—notably with LG in displays, and
Sumitomo and OLEDWorks in lighting. The firm likely will extend its current deal with
Samsung before it runs out in 2017, and arguably with some leverage having LG as a
partner now.
Novaled, meanwhile, is adjusting to life under the Samsung umbrella; its acquisition by
Cheil was one of the big newsmakers of 2014. As was expected, Cheil/Novaled
apparently has taken UDC's phosphorescent green host business at Samsung. Novaled
is still supposed to be quasi-independent from Samsung, although it would be hardly
surprising if Samsung's competitors were wary of dealing with Novaled given this
relationship.
Other large OLED materials suppliers remain in good standing with either Samsung or
LG (or both): Dow, DuPont, BASF, Merck, LG Chem, etc. There are also the longtime
OLED materials suppliers out of Japan: Idemitsu Kosan, Nippon Steel, Konica Minolta,
Sumitomo Chem and Mitsubishi Chem. These firms began as suppliers to the PM
OLED business and they will have to adopt new strategies in the future.
Most interestingly, there are hungry new entrants into this sector that see ways to
compete with new technologies, new and better emitters for example. Cynora, for
example, is developing iridium-free OLED materials, chiefly green and red
phosphorescent emitters (putting them in competition with UDC), as well as a stable
blue emitter.
As n-tech sees it, the interplay between these three groupings of suppliers is perhaps
the most interesting aspect of the OLED materials market at the present time. It is still
unclear to us whether given all the uncertainties and captive markets that are
characteristic of the OLED market right now, the newer companies in this space stand a
chance of success.

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At the same time, new issues are beginning to emerge that will help shape the OLED
materials business in the future and it is possible that some company not prominent
now will be able to leverage one or more of these issues as a path to the top.
The need to be “green” is one such consideration, as is the need to stay away from rare
materials (namely iridium). There is also the annoying and perennial issue of
encapsulation, which has come to fore again with the flexible OLED panel issue. This
issue. Here we note that Corning is back in the picture with its flexible glass, at least for
OLED lighting, but also that OLED encapsulation has buried companies in the past.
1.3 Objective and Scope of this Report
In this report, n-tech Research identifies the opportunities in the OLED materials
business. We also examine the core strategies of leading players in the OLED materials
space, including technology differentiation and key partnerships.
As always, we include detailed volume and eight-year revenue forecasts, broken out by
application, material type, functionality, and deposition method (where possible and
appropriate). Forecasts for OLED panel area are derived from estimates and projections
of OLED shipments and manufacturing capacity, and how these will likely translate into
materials requirements.
1.4 Methodology of this Report
This report is based on n-tech Research's ongoing industry research in OLEDs and
OLED materials, which includes ongoing discussions with key players throughout the
OLED community. We have also utilized our previous reports in these and related
areas. Where information is used from an earlier report it has been reinvestigated,
reanalyzed, and reconsidered in light of current developments and updated accordingly.
We also have relied upon our own extensive research of secondary sources: technical
literature, trade journals, press articles, SEC filings and other corporate literature,
government resources, and various collateral from trade shows and conferences. In
addition, we considered broader economic developments that may influence the
underlying applications markets, technical developments and improvements, and
commercialization.
This report is entirely international in scope. The forecasts are worldwide forecasts and
we have not been geographically selective in the firms that we have covered in the
report or interviewed in order to collect information.

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1.5 Plan of this Report
In Chapter Two we explore recent trends and changes in the various applications for
OLEDs: displays (small/medium, very small, and large) and lighting.
Chapter Three looks at technology trends that are shaping the OLED materials market,
both in the OLED stack and in other areas: substrates, encapsulation, and
manufacturing processes.
In Chapter Four we analyze the current state of the OLED supply chain. As briefly
mentioned above, we review who's working with whom, and where the challenges and
opportunities are.
In Chapter Five we lay out all our forecasts for OLED materials with breakouts by
application, layer functionality, and type of material, from the substrate and emissive
layer to encapsulation technologies.

OLED Materials Markets: 2015-2022: Momentum and Opportunities

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OLED Materials Markets: 2015-2022: Momentum and Opportunities