​Samsung (005730.KS) continues to play with its Mini-LED/QD TV pricing, almost on a weekly basis, and while two of the 36 sets in the 2021 Mini-LED/QD or QD only line-up are at their highest price point since release, 23 are at their lowest price point, with all 8K Mini-LED/QD sets at their lowest price points.  The biggest changes from our last pricing (2 weeks ago) show up in the same 8K Mini-LED/QD group, where the average price drop (wk/wk) is $400, with those sets down 25.3% from their original price on average, however as the largest size (85”) set has changed little in price over the last month, the two other sizes are down 29.3% from their original price.
A number of the QD only sets also moved considerably over the last two weeks, with one model (75QA) dropping from $2,700 to $1,900, an almost 30% discount, while most other 4K Mini-LED/QD and QD only sets are down from their original prices between the high teens and low 20% range.  While all TV brands play with TV pricing, Samsung seems to be far more willing to offer discounts on this year’s line, particularly with Mini-LED/QD sets.  While taking advantage of a particular bi-weekly change might get you some short-term savings, the trend has been downward, which will likely continue for the rest of the year.

​Sanan (600703.CH) has announced that it will sell shares in a non-public offering to raise capital for a Mini/Micro LED project in Hubei Province.  While the amount of the offering has not been specified, we believe it will be complemented by a subsidy from the local government.  The project is said to composed of an R&D center, a line(s) for Gallium Nitride (blue or green), Gallium Arsenide (red) chips, and a line for packing the LEDs into 4K displays.  The project, will be situated in Ezhou Gedian Development Zone, where a number of Chinese semiconductor and panel producers have existing facilities.  More to come. 

As part of our understanding of Mini-LED and Micro-LED technology, we have looked at a number of bottlenecks that face the industry as it gears up for rapid expansion over the next few years.  One of the more obvious areas where technology must improve is the transfer process, where LEDs are moved from the wafers on which they are produced and placed on a substrate to form a module.   As Micro-LEDs are still far from real commercialization, we limit the discussion here to Mini-LEDs, a smaller version of what is used in most displays, but larger than Micro-LEDs.
LCD displays are driven by the properties of liquid crystal, a substance that is somewhere between a liquid and a solid.  The molecules in liquid crystal can re-order themselves into a number of shapes and directions called ‘phases’ and by changing the electrical characteristics applied to the LC material, that orientation can be controlled.  But liquid crystal does not produce light, so in LCD displays a backlight must be placed behind the liquid crystal, which then can be used to block or pass the light through the crystal.  As each pixel in an LCD display is made up of three sub-pixels (Red, green, and blue), there is a controlling TFT (Thin-film transistor) circuit behind each sub-pixel, allowing the control of the liquid crystal to be broken down into three segments for each pixel.
Once the backlight passes through each sub-pixel, it goes to a color filter, essentially a sheet covered with red, green and blue dots made of a phosphor.  By using the TFTs to open or close each sub-pixel’s liquid crystal, the color of the combined three sub-pixels can be created.  For example, a pixel of this color 

​would be comprised of the liquid crystal controlling the red sub-pixel being open 71%, the green sub-pixel being open 21%, and the blue sub-pixel open 98%, while this color   

​would be created with the red sub-pixel at 89%, the green sub-pixel at 92%, and the blue sub-pixel at 27%.  With just 100 level gradations 1m colors can be created and with 1,024 levels over 1b are available. 
Sounds good, right?  But there is a problem.  In many LCD displays the light that is needed to be transferred through (or blocked by) the liquid crystal is produced by LEDs and in less expensive displays those LEDs are placed around the edge of a translucent sheet (diffuser) that spreads the light evenly (hopefully) across the sheet.   This is where the problems start however as the characteristics of liquid crystal do not allow it to completely ‘close’, so a pixel that should be black still has some of the backlight shining through, creating at dark gray dot rather than a black one.  Further, in an image where there is a close proximity of a dark section and a bright section, the backlight, which is always on, will spill from the bright pixels into the dark pixels and create what is called ‘bloom’, a halo-like corona around the bright image.

But backlight designers are a resourceful lot and they came up with the idea to move the LEDs from the diffuser edges to behind the diffuser itself, creating what are called direct-lit LCD displays.  In this structure, the light is more uniform across the display but the same problems persist as in edge-lit LCD displays, so designers took things further and created what are known as Full Array Backlights.  While these are similar to Direct-lit backlights, they operate differently.  Rather than having all the LEDs on all the time, Full Array backlight LEDs are grouped into ‘strings’ and ‘zones’.  Strings are a set of LEDs that work as one, meaning they can all be on or off but no individual LED can be different than the others in a string.  Strings can be combined into zones, where a number of strings all work together, say in an area where the image is bright, so the system can be used to keep ‘bloom’ under control by shutting off a string in a zone next to a bright part of the image to reduce the amount of light ‘spill’.  

Under this system, rather than the whole backlight being controlled as a unit, the image is divided into zones and the software breaks down each frame, evaluating the brightness of the zones and adjusting the strings accordingly, but even with many zones and many strings, designers could not achieve the ‘blackness’ that OLED TVs are able to generate, given that each OLED self-emissive sub-pixel can be completely turned off.  Again, not to be outdone by OLED, backlight designers came up with Mini-LED backlighting, a more modern form of Full Array technology.  Instead of grouping the LEDs in strings, each LED in the backlight can be individually controlled, so bleeding issues are reduced further, and the LEDs are smaller, so more can be added to the same space, increasing the display’s ability to light each part of the image as needed.

This concept will increase the viability of LCD displays when compared to OLED displays and will help to extend the life of the vast LCD infrastructure that has been built over the last decade and a half, which is a key reason why LCD panel producers want to promote Mini-LED technology, but there is a catch or more precisely catches. Adding more LEDs means they have to get smaller and smaller LEDs are harder to produce and handle, and the circuitry that is used to drive and control these individual and smaller LEDs gets more complex and more expensive, so there is a production gap between full array backlights and Mini-LEDs until the industry works through ways to reduce the cost of producing Mini-LED backlights.
As Mini-LED backlights can contain many thousands of individually controlled small LEDs typical equipment designed to move a relatively small number of larger LEDs from a wafer to a backplane do not have the speed or accuracy to be cost effective when applied to Mini-LED production.  Typical LED pick and place systems are not able to move these smaller LEDs so new equipment has been developed that can handle these components gently enough and with enough accuracy to make Mini-LEDs cost effective.  One such tool that has been adopted by ‘a major consumer electronics company’ (Apple – AAPL) is produced by Kulicke & Soffa (KLIC)[1] called Pixalux.™ that the company designed jointly with Rohini (pvt). Together they developed a high speed system that ‘punches’ Mini-LEDs from a tape onto a substrate with a mechanical ‘pencil-like’ point.  The speed of the system and the accuracy are better than most modified pick and place systems and the company has been the dominant player in the Mini-LED tool space.
With a top speed of ~75 LEDs/second, populating a Mini-LED backlight with 135,000 Mini-LEDs using the Pixalux tool would take about 30 minutes and the accuracy would be limited to <20um, meaning there would be limitations on LED density, but KLIC has just taken the industry a step further and shipped its next tool for Mini-LED production.  The Luminex™ tool is based on a very different process for transfer, using a laser to heat a double layered tape containing Mini-LEDs.  The heat of the laser creates a bubble in the tape layer on which the Mini-LEDs are attached and pops the Mini-LED off without any physical contact.  This system, which was developed by K&S and a formerly private firm, Uniquarta (pvt), now owned by KLIC, can move up to 1,000 Mini-LEDs/second, at an accuracy of <10um, which would reduce the time to process the same 135,000 Mini-LED array from ~30 minutes to 2.25 minutes, increasing the throughput by over 12 times.
All said, the transfer process is only one step, albeit an important one, in the manufacturing of Mini-LED backlights.  Before they are transferred, the Mini-LED dies have to be created via MOCVD, which is usually done on three separate wafer, one for each color (Blue & green use similar process materials, but red uses different materials).  The die then have to be sorted (performance characteristics) and combined and usually placed on a temporary substrate before being placed on the final array substrate.  These processes are typically done with other tools, however K&S has included the sorting, mixing, and temporary placement steps in the Luminex tool, which has made the new tool not only faster and more accurate, but has reduced the overall cost of ownership across the Mini-LED production line.
Given that it has taken K&S about two years to develop each Mini-LED transfer iteration, they have set a roadmap for the next generation of Mini-LED processing tools that will take the Luminex laser technology and by splitting the beam would be able to transfer at a rate of 10,000 LEDs/second at an accuracy of <1um.  While we don’t expect to see that tool until 2023, it will have applications for both Mini-LEDs and Micro-LEDs, another display technology that is still in the development stage but has the potential to be a significant part of the display space over the next decade.  Of course there are still other bottlenecks that will keep Mini-LED costs non-competitive for a period of time, but with each equipment iteration, the ability of Mini-LED manufacturers to bring costs in line with other display modes increases, and based on even the most conservative estimates, the Mini-LED market is expected to grow rapidly in both units and dollars over the next 4 years.  Hopefully display producers will use those cost savings to bring down premiums on Mini-LED products (see our note from 9/29/21 for details) and enable more cost conscious consumers to avail themselves of the technology.


[1] Please note that we have no financial or business relationship with KLIC.  We speak to the company on occasion and receive no compensation or proprietary information, as is the case with all of our sources.

To learn more about Mini-LED tools:
07/13/21 - http://scmr-llc.com/blog/micro-led-madness
02/12/21 – http://scmr-llc.com/blog/micro-led-primer
02/08/21 – http://scmr-llc.com/blog/klic-buys-uniqarta
​

There have been a number of mentions in the trade press concerning the slow development of the Mini-LED TV market recently.  Some are based on component availability, meaning LEDs and the Mini-LED modules themselves, and some are speculating that consumers are apprehensive about a new technology that has only been available for a relatively short time and is not quite understood by rank and file TV buyers.  Looking at the component side, much of the consternation over shortages of Mini-LEDs seems to be coming from smaller LED producers and packagers, who are a bit more capital constrained that major LED suppliers such as Ennostar (3714.TT), Sanan (600703.CH), and Nichia (5393.JP) and given the larger numbers and smaller size of Mini-LEDs the cost of production is higher than generic backlight LEDs, but these are all issues that are common to almost every technology upgrade, which Mini-LED backlights certainly are.
In our view there are two obstacles facing the Mini-LED market, more specifically the Mini-LED TV market, and all are related to price.  Not as much the price of the Mini-LEDs themselves, or the backlight arrays, but the price of the TV sets in which they are used.  The price of Mini-LEDs will decline as competition from China increases, particularly from BOE (200725.CH), who has already staked a claim in the Mini-LED backlight module market by shifting to glass rather than PCB substrates for its commercial Mini-LED modules, which is an aggressive step forward in the development of the Mini-LED modules, but a necessary one if the market is to grow.
The bigger problems is Mini-TV set pricing itself which not only must absorb the higher cost of the Mini-LED backlight modules, but the advertising, development costs associated with Mini-LED modules, require larger driver and timing circuitry, and most importantly the TV brand’s desire to generate higher margins than those from generic LED backlit sets.  In order to better understand Mini-LED TV pricing we have put together a table identifying 42 Mini-LED TV models, 37 of which are models announced or released this year.  We have excluded any models that are no longer available, although we note that some models, particularly from Chinese brands, are not available in the US.  The database looks at over 15 comparative features, although in the table below we leave out many such features that do not have to do with the physical aspects of the TVs themselves, such as which streaming services they support or sound systems.  The abbreviated table below shows a subset of our data, and we note that TCL (000100.CH), the first TV brand to release a Mini-LED TV (2019), still makes available previous year models which we have included.  All other brands and models are from this year.
That said, here is what the data indicates.  The lowest priced Mini-LED set is the 55” TCL 4K (Model 55R646), which sells for $950.  This compares with Samsung’s (005930.KS) two 55” sets (QE55QN90A & QE55QN85A) which sell for $1,550 and $1,400 respectively.  Samsung does produce a 43” model (QE43QN90A) that sells for $1,300 but is currently in very limited production.  The most expensive Mini-LED sets on an absolute basis are the Skyworth (751.HK) 86” 4K Q72 at $7,744 and the Xiaomi (1810.HK) 82” Extreme, which also sells for the same price.  However when we look at the sets compared against the price/in2 of screen space, Xiaomi is both the winner and loser, with the abovementioned ‘Extreme’ 8K being the most expensive at $2.70/in2 while their 82” 4K ‘Master’ set is the lowest at $0.54/in2.  With the Xiaomi sets to be made available next month, we expect the price of the ‘Extreme’ might see some revisions, but for those brands that have few offerings, the number of units sold will be almost irrelevant.  The real battle here is between Samsung, LG (066570.KS), and TCL, with Samsung setting the pace with 16 models, LG with 6 and TCL with 5 (2021).  Looking at the two TV sizes that are common to all three brands, TCL is again the lowest cost/in2 for both while Samsung and LG are almost identical.
We note as always that much of the competition between brands is feature based and that goes to a new level with Mini-LED TVs, with the number of Mini-LED ‘zones’ and the absolute number of Mini-LEDs the new battleground.  Not all brands give out this information, sometimes because they don’t compare well or they don’t want to reveal such competitive information, but while the absolute number of Mini-LEDs is important to the set’s ability to reduce backlighting issues such as ‘bloom’[1], there are many other factors that can contribute to how well images look on Mini-LED LCD TVs.  All in, the growth of the Mini-LED segment will be driven by how quickly component costs can decline, and how willing brands are to ‘seed’ the market with more realistic premiums.  Consumers need to be incentivized to explore the benefits of  Mini-LED TVs and those brands that are willing to offer sets at more realistic premiums will win the battle.  Given that this is really the first year that there has been a more than one brand offering such TVs, while the press calls this year ‘the year of Mini-LEDs’, we believe the first year when competition really begins will be 2022.


[1] ‘Bloom’ – When LEDs in light areas leak into dark areas.

While our obsession with trying to understand Samsung’s Mini-LED/Quantum Dot TV pricing continues, we do a quick look below at how Samsung’s Mini-LED TV pricing compares with those of TCL (000100.CH) and LG (066570.KS).  There are other brands that also offer Mini-LED/QD TVs but feature comparisons and pricing equivalents in the US are a bit more complicated than the table below warrants.  Of the three brands below, TCL is the price leader, which is consistent with their policy generally, so we use TCL as the base for comparisons here.  Note that we have only included those sets that are comparable, which limits the size of the table somewhat but gives a better comparison of set-to-set equivalent pricing.  As can be seen, TCL is the price leader for all models, other than the equivalent less featured models, with both LG and Samsung having lower base prices for that tier.  Note also that the prices shown for Samsung’s Mini-LED/QD TVs are current prices and are all lower than Samsung’s original release prices, which ranged from 14.3% to 24.3% higher than current.

Our obsession with Samsung’s (005930.KS) constantly moving pricing structure for their 4K/8K Mini-LED/QD TVs continues, but it looks like Samsung has reached a point where they either feel that they are selling enough sets from this new line, or the cost of producing same is beginning to affect the end-user price.  In short, prices for these sets, while still below Day 1 pricing, do not seem to be heading down, with only 3 of the 33 we track at their lowest prices, with 5 (15.2%) lower than our last check (average decline 4.7%) and 10 (30.3%) higher (average increase 6.2%).  Of the 15 Mini-LED/QD sets we track (includes 4K & 8K) 7 (46.7%) saw price increases, while 3 (20%) saw price decreases.  The table below breaks down the categories and compares the current discount to Day 1 pricing to pricing 2 weeks ago.

China’s TCL (000100.CH) is on their 3rd iteration of Mini-LED TVs, while typical leaders Samsung Electronics and LG Electronics (066570.KS) are on their 1st.  As we have noted previously, TCL has also been the price leader in the Mini-LED TV space and is one of the reasons Samsung has been changing prices on its Mini-LED/QD TVs on almost a weekly basis.  That said, TCL also noticed that Samsung’s product line-up is more extensive than theirs and includes a number of high-end models that were not part of the TCL Mini-LED/QD line.  In order to remedy that situation and capture a portion of the premiums associated with such high-end models, TCL has just released two new Mini-LED sets, both 8K models, in three sizes, 85”, 75”, and 65”.
Again, we note that comparing feature sets in TVs is quite difficult as not only are not all features specified for each TV model with the ‘value’ of features specific to a particular brand subject to great variability, but specs like ‘lots of’ or ‘thousands of’ leave a bit too much to the imagination.  That said, what is notable with these new TCL Mini-LED TVs is that while the TCL model shown in the table is 11.3% less expensive than a comparable Samsung set, it is not the more typical 20%+ less featured and less expensive that has been the go to TCL vision.  It seems that TCL has gotten a taste of the ‘high life’ and is willing to play into the same premium pricing plans that Samsung and LG have been working toward, at least for their Mini-LED/QD sets.  Whether TCL will sell enough of such high-end sets to make a difference remains to be seen, but it was likely an easy decision to give it a try now that others have set pricing at the high-end of the market.

Mini-LED backlighting is a good thing.  By making the backlight LEDs smaller designers are able to add more LEDs to the backlight array and give the backlight more control over what parts of the display are lit or not lit at any given time.  Since most images and video have many areas where dark sections abut light sections, that increased control can reduce issues resulting from lit LEDs that are right next to dark areas.  Since Mini-LEDs are similar to standard backlight LEDs (only smaller), developing Mini-LED arrays does not entail building out significant new infrastructure, allowing suppliers to gear up and produce Mini-LED BLUs for their own products or to sell to outside customers.
The downside to this is the fact that the premiums associated with this ’new’ technology will not last for an extended period, and the competitive nature of the product will make it difficult for brands to maintain the unusually high premiums that exist on some Mini-LED products currently.  Aside from TVs, Mini-LEDs are used for monitor backlights, particularly those designed for gaming and image processing, where parameter control is of great importance.  In terms of overall performance, as Mini-LED based monitors are LCD based, they tend to be brighter than most OLED display based monitors, and the increased number of LEDs used can add a bit to overall brightness.  Unfortunately not all brands specify brightness in terms of averages, with many only giving peak values, but any brightness value over 500 is better than most TVs.
Most high performance monitors are either 27” or 32”, at least currently, with ASUS (2357.TT) being the monitor producer with the most Mini-LED models, but there’s a new kid in town, HKC (pvt) who has released its own 27” Mini-LED monitor that is going to put some price pressure on those that charge premium prices for Mini-LED monitors.  HKC produces its own LCD displays and its self-developed Mini-LED backlights have now been qualified by OEMs, assemblers, TV brands, and other panel producers including Samsung, Foxconn (2354.TT), and Konka (000016.CH).   The company is expected to expand its Mini-LED production by building out enough capacity to give it the #3 share in the market (still waiting for details), but with its first offering, it has set a new price point that will make comparisons against even the top Mini-LED models more difficult as to price.
The table below shows some of the top Mini-LED Monitors and the specs that highlight each device.  Some have lots of LEDs, some have lots of ‘zones’ for more exacting control, and some have high brightness or color coverage, but while the HKC Mini-LED monitor gets good marks for its comparable specs, it is considerably less expensive than most, and will open the Mini-LED market to a broader group of users who might have passed on alternative brands due to cost.  The HKC units will become available in Hong Kong next month and are expected to expand to other cities by the end of the year.  We note that there are other metrics that are involved in deciding absolute value of monitors, but all monitors included in the list below are considered the top or among the top few Mini-LED monitors currently available.

​While Labor Day is not considered a major shopping holiday, as it falls during the back-to-school period for most, CE brands have an opportunity to stimulate sales with discounts to attract buyers to new, higher margin products, or those where excess inventory needs to be moved.  TV sets are not the usual fare for this holiday, as laptops and tablets are more typical of what might be needed by students, but in light of the fact that Samsung’s line of Mini-LED/quantum dot TVs are both relatively new and have therefore been in a sort of pricing limbo, having little initial reference point, we took a look at where pricing stood during the holiday.
Using the same 33 set Samsung TV lineup that we have used since the May 20 release, we show the following:

• The composite group, which includes six 8K Mini-LED/QD TVs, nine 4K Mini-LED/QD TVs, and eighteen 4K quantum dot enhanced TVs, is priced 14.5% lower than original pricing.
• The 8K Mini-LED TVs are priced 21.8% lower than original pricing
• The 4K Mini-LED TVs are priced 15.3% lower than original pricing
• The ‘QD only’ 4K TVs are priced 11.7% lower than original pricing
• Of the 33 sets in the group, 15 are at their lowest price point since original pricing
• Of the 33 sets, none are above their highest price point
• Of the 33 sets, 3 are equal to their highest price point
• Of the 33 sets, 2 have not changed from their original price
• Of the 33 sets, 20 are at a lower price than when we last checked (8/24/21)

All in we believe Samsung is still looking for a valid price point for its Mini-LED/QD line and will continue to offer increasing discounts as the holidays approach.  With 80 days to Black Friday and 83 to Cyber Monday and the high cost of existing TV inventory, we would expect Samsung and other TV brands to push hard to get product sold, and even with retailers extending the pre-Black Friday period all the way back to November 1, we expect it should be a relatively tough season for TV sales unless TV panel prices continue to drop precipitously for the remainder of the year.  This will create some less expensive inventory, but transportation costs, component shortages, and overall weaker demand will have to see a spark in consumer interest in the TV space if the season is to be salvaged.  Samsung says it expects to ship 1.8m Mini-LED/QD sets this year.

While we expect Apple (AAPL) will modify and expand its Mini-LED supply chain as the company adds additional Mini-LED product conversions to its line later this year, we can garner at least a rough map of current players.  These suppliers are certainly not exclusive, at least intentionally so, as Apple is wary of single-point-of-failure issues, but in these relatively early days of Mini-LED production, not all suppliers can meet Apple’s technology, quality, and volume demands, especially after issues around some of Apple’s earlier Mini-LED products gave users cause for questioning whether the change to Mini-LED is a good one.  With iPad sales strong, it seems the overall Apple customer is convinced, but we would imagine Apple is particularly careful when adding new suppliers.  Here’s the latest list.