Models pose with Samsung's 55-inch curved OLED TV during a press conference. Photo: AP
Samsung launched its first OLED TV on Thursday, taking the ultra-thin technology into a nascent market despite tenacious production challenges that keep costs high while prevailing LCD screens only get better and cheaper.
The world's biggest TV manufacturer has staked its display future on OLED - organic light emitting diode - technology and its success with smaller screens has bolstered its smartphone market share and earnings. But big screens are likely to take a much slower road to profits.
OLED technology is widely believed to offer the potential for better picture quality than standard liquid crystal display screens, with crisper picture resolution, faster response times and high-contrast images. It also allows for curved televisions, which manufacturers say offer a more immersive experience.
Kim Hyunsuk, the executive vice president of Samsung's TV division, right, poses with its 55-inch curved OLED TV during a press conference. Photo: AP
But production constraints are a key problem.
Samsung is producing OLED screens for TVs from a small pilot line and some analysts estimate the yield at just 30 per cent - with seven out of 10 screens from the line faulty, largely due to difficulties in spreading organic light emitting materials evenly across large screens.
Although many industry experts believe OLED will eventually be the next big thing, they do not think it will manage to do to LCDs what LCDs did to bulky cathode ray tube sets: almost completely replace them in the space of just several years.
"They are not sufficiently transformational to trigger a complete switch-over from LCDs," said Eo Kyu-jin, an analyst at IBK Securities, adding that for now OLED televisions would represent less than 1 per cent of the 200 million-plus global TV market.
Samsung's 15 million won ($14,000) price tag on its curved 55-inch OLED television is the same as similar offerings from LG Electronics, some five times more than popular LCD equivalents.
Samsung itself took a cautious tone, warning that industry forecasts for sales growth were a bit too optimistic.
"We have just introduced our first OLED TV and have to see consumer response to gauge overall market demand," Kim Hyunsuk, a Samsung executive vice president, told reporters.
Research firm DisplaySearch has forecast global industry-wide sales of OLED televisions at 50,000 this year and 600,000 next year, with rapid growth thereafter to reach 7 million in 2016.
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