Is Sony TV Spin-Off a Potential Rival?

Posted by: Kenji Hall on July 2, 2008

Did Sony unwittingly spawn a rival TV technology? That’s a question worth asking now that it appears that Field Emission Technologies, which was split off from Sony in late 2006 with funding from TechGate Investment, is nearing the commercialization of a new type of flat-panel TV that’s a cut above current liquid-crystal-display sets.

According to this morning’s financial daily Nihon Keizai Shimbun, Tokyo-based FET plans to spend about $200 million to $300 million for Pioneer’s plasma panel-making plant, located in southern Japan, later this year. FET will then retool the facility so it’s ready to mass-produce field-emission displays by late 2009, the paper said. Initially, the volumes and panel sizes will be small: 10,000 26-in. panels a year. Hospitals, TV and movie studios and broadcasters, which rely on high-definition pictures, are expected to be the first customers. Later, FET will expand to giant 60-in. TVs, a sector of the market that only a few manufacturers have the technological knowhow to enter, can charge consumers a premium. Market watcher iSuppli predicts that field-emission display makers will ramp up to 2 million units worth nearly $200 million by 2012. (Japanese high-tech manufacturer Futaba has a head-start on FET.)

Not long ago, experts were touting field-emission displays as a major threat to LCD and plasma TVs, now the dominant flat-screen technologies. Experts say the technology--also known as surface-conduction electron-emitter displays, or SEDs--offer a sharper picture than LCD and plasma displays but use a fraction of the energy. Because they don’t require a backlight, like the old picture-tube TVs, SEDs and FEDs tend to show images in colors that are closer to the way the objects would appear if seen with the naked eye. (Backlights make images appear brighter than they might appear in real life.)

Canon and Toshiba had formed a joint venture and planned to roll out their first sets before the Olympic Games begin in Beijing this summer. They hadn’t planned on the technical difficulties of producing SEDs. Nor had they expected to lose a U.S. legal battle to Austin, Tex.-based Nano-Proprietary over key patents last year.

FET’s progress is financially good news for Sony, which began working on FED technology in 1998 and today owns 36.5% in the venture. (TechGate owns the remaining portion.) It’s also proof that Sony, which in the past might have starved this technology of funding rather than grant it independence, is figuring out how to get the best of the technologies that have plenty of potential but aren’t a priority.

The problem is, FET’s plans put it in direct competition with Sony’s in-house next-generation technology, known as organic electroluminescent displays, or OLED. Sony began selling the first of its OLED TVs, an 11-in. set that’s only a few millimeters thick, in Japan last December, and has plans to move up to larger sizes, where consumers will pay a premium and profit margins are fatter.

But many of the details about FET’s TVs remain unclear. (A spokesperson for FET couldn’t be reached for comment.) One option would be for FET to sell its panels to Sony, which would assemble the sets and sell them under the Sony brand. That would make sense to me. The danger, of course, is that introducing these newfangled sets too early could prompt some consumers who are still on the fence about trading in their bulky cathode-ray-tube or rear-projection TVs to hold off buying an LCD set. That might slow the momentum Sony needs if it’s to fulfill its ambition of becoming the world’s No. 1 LCD TV maker in the next few years.

Reader Comments

Sonalee

November 5, 2008 2:47 AM

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so keep it up carry on

regarded
http://www.livetv.pk/sony_tv.html

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Bloomberg Businessweek’s team of Asia reporters brings you the latest insights on business, politics, technology and culture from some of the world’s biggest and fastest-growing economies.

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