Since 2020, Micro LED has attracted much market attention.
Compared with traditional display screen technology, Micro LED display screen is bright and colorful, with advantages of long life, fast response, light weight, power saving, etc., and is regarded as the most potential technology in the display field.
Micro LED was first developed in the high-definition TV market. In 2012, Sony launched a 55 inch Micro LED display screen, making Micro LED appear in the market as a commercial product for the first time. Since then, Sony released its first Micro LED TV in 2017, and Samsung launched the commercial display The Wall in 2018, starting the research and development of micro LED high-definition display.
In 2021, after the AR smart glasses manufacturer Vuzix released the world's first smart glasses based on Micro LED, the capital market suddenly realized the great value of Micro LED in the future of the meta universe, and Micro LED quickly became popular.
The provincial and municipal governments of Beijing, Shanghai, Chongqing, Guangdong, Fujian and other cities across the country have strengthened the layout and support of related industries, and clearly proposed the development of new Mini/Micro LED display technology in the "Fourteenth Five Year Plan" strategy for manufacturing industry.
In the capital market, Micro LED and related industrial chain companies have obtained financing in succession: in February 2022, gallium nitride (GaN) semiconductor material developer materials and Micro LED technology company Porotech completed a round of financing of 20 million US dollars, and Samsung venture capital followed; In May, Wejian Intelligent, a manufacturer of high-precision crystal fixer equipment, completed tens of millions of rounds of A financing; In August, Micro LED enterprise Stan Technology completed several financing, including strategic investments such as Zhongxin Juyuan, Xiaomi Industrial Investment and Shunyu Industrial Investment, and financial investments such as Sequoia China and CICC Capital
It is worth mentioning that on August 18, Micro LED Factory Suntech was listed on the innovation board in Taiwan, China. The 110 inch Micro LED TV product jointly developed by Suntech and Samsung was officially launched on Friday (August 26). The selling price is 1.05 million yuan.
This is the third listed company that Xiangfeng Investment welcomes this year. Xiangfeng Investment has been ahead of this wave of Micro LED investment outlets for two years. As early as 2018, Xiangfeng has laid out the innovative technology. It has laid out its layout in the display field for many years, and has also invested in enterprises in the display and VR fields, such as Yunyinggu, Lightgrain, etc.
In this paper, 36 Krypton invited Xia Zhijin, the management partner of Sunfong Investment, to discuss in depth the development opportunities of Micro LED industry, the core technical difficulties such as massive transfer and massive repair, as well as the future market space and enterprise development path of Micro LED enterprises, to look forward to the future development of Micro LED industry.
Technical Barrier of Micro LED
Krypton 36: Why is Micro LED on fire?
Xia Zhijin: Since the second half of last year, everyone has been discussing the relationship between the meta universe and AR, VR. They think that in the meta universe, the display module is also very important, and Micro LED may be the ultimate solution.
This year, more importantly, Samsung and Yuchuang announced that they would mass produce their micro LED displays internationally, which may be shipped in large quantities in the third quarter.
36 krypton: As the most potential technology route in the display field, what are the characteristics of Micro LED display?
Xia Zhijin: It has two characteristics, one is particularly bright, the other is very good color and high color rendering. There are many kinds of colors in nature, but traditional LCD displays can not show all of them. Micro LEDs are much larger than traditional LCDs, and have more rich and bright colors. In contrast, the contrast of traditional LCD display is not very high, Micro LED and OLED are much higher, and Micro LED is higher. In addition, the life of Micro LED is several times longer than that of traditional display, and the power consumption is only half of that of traditional display.
36 krypton: What is the difference between Micro LED and LCD, AMOLED, Mini LED and other technology routes?
Xia Zhijin: First of all, compared with the traditional LCD display, the AMOLED display has the characteristics of bright colors, low power consumption and high contrast; Micro LED is better in three dimensions, and can be transparent and curved.
In addition, in terms of light source, the traditional LCD display is not self luminous. It needs a backplane, which can be adjusted by controlling the front LCD to make the light more uniform; However, the light source of AMOLED can emit light independently, and each point can emit light. Micro LED is also self luminous.
The Mini LED is an intermediate technology route. The size of the Mini LED may only be about 200 microns, which is difficult to be very small and cannot be used in VR display and other scenes - AR display requires a very small size, with a big difference between less than 5 microns and 200 microns. I think the traditional process of Mini LED may be difficult to reduce so much through iteration.
Krypton 36: From the perspective of industrial chain, what are the upstream industrial links of Micro LED display?
Xia Zhijin: Its upstream is similar to the traditional semiconductor and display industries. There are materials in the upstream, mainly Sumitomo Japan and American material companies; Then some equipment companies and substrate companies will have circuits on the traditional substrate to control each pixel. However, Micro LED will be very different. It is mainly produced by semiconductor. The LED light emitting unit is very small, which is tens or hundreds of microns in size. It is necessary to make LED on the wafer first, and then transfer it to the display substrate of the TV to complete the alignment and display lighting steps.
Krypton 36: In terms of the whole industry, which part is the most expensive?
Xia Zhijin: The entire Micro LED industry is still in a relatively early stage, and it is difficult to calculate the proportion of a specific link in it. Now I think the biggest cost is how to make a display on the substrate, which is the luminous LED. Whether it is done through a huge amount of transferred technology or wafer bonding, the difficulty and cost of this part are the highest, and there may be some technical difficulties to overcome.
Krypton 36: As one of the most potential display technologies, what difficulties do you think Micro LED screen has in the production process?
Xia Zhijin: The first difficulty is the processing of LED. Now it mainly uses gallium nitride, that is, compound semiconductor technology to make LED. The second is to transfer the led to the display substrate in batches and make a huge amount of repairs, which is the most difficult link. The third step is to develop color on this basis, and build a complete display screen. This part has certain difficulties, but there are also some relatively mature programs to do.
36 krypton: HD TV and VR glasses are the two markets with the highest expectation for Micro LED display on the market. Is there any difference between the production technologies of large and small Micro LED displays?
Xia Zhijin: Micro LED has many application scenarios, and the production process is different in different application scenarios.
For large screen Micro LED, massive transfer technology may be the mainstream technology in the future. A 4k TV has 8 million pixels. Each pixel has three RGB sub pixels, red, yellow and green, totaling 24 million sub pixels. Led's luminous unit is very small. Even if the yield reaches 99.99%, 2400 pixels will be bad, which is totally unacceptable in the TV industry. Traditional TV will be judged as a bad product as long as there are a few bad points.
How are so many sub pixels placed on the display panel? It uses a huge amount of transfer technology, which requires the unified transfer of large quantities of leds. The transfer one by one is inefficient and difficult to align. There will certainly be many bad points in the transfer process, so we should cooperate with the technology of massive repair. For the bad points in the transfer process, we should have the technology to quickly and massively repair, and repair thousands or tens of thousands of points at a time. This is one of the difficulties that many manufacturers are tackling.
Many people know how to do this technology, but the problem is whether they can achieve a good success rate and consistency. This stability is difficult to achieve. Even if 99% of the yield is achieved, there is still a big gap between 99% of the yield of many domestic teams.
If it is used for AR display screen, Micro LED may be within the range of 0.5 inch and 0.7 inch, but not more than 1 inch. Small screen Micro LED display has many technical difficulties, and we have not yet determined the mainstream technical route. Now I haven't seen a good product, even a demo product.
Some companies have displayed monochrome Micro LED products, but I think there may be some problems in the research and development of full-color Micro LED. The color micro LED small screen display has many technical difficulties to solve, such as how to align, how to align wafer bonding, how to solve the problem of three kinds of light emitting units, and what technical means to use.
Krypton 36: Who will do the huge amount of transfer work, the display manufacturer or the equipment company?
Xia Zhijin: Micro LED manufacturers usually have a lot of customized equipment with equipment manufacturers.
Krypton 36: Do you see any different technical solutions in color development?
Xia Zhijin: Led has three RGB colors. The brightness of these three leds needs to be adjusted to display different colors. This is processed on different wafers. For example, moving the red color to the CMOS substrate and then moving the green color to it is very difficult to align each time.
Now there are different people and different teams making technical attempts. For example, to make a small screen Micro LED, some people use the quantum dot method to make a ternary color. The light emitting device at the bottom may be a monochrome LED. Through some other means, the light has three colors that can be controlled;
Another technical route is to directly arrange three different types of leds together. This technology is more difficult. We all know that red LED is very difficult to do in the RGB three types of leds. There are some problems with its luminous efficiency and life, and it is difficult to cooperate with the other two types of leds.
I believe that in the future, there may still be different technical routes to make Micro LED products.
Krypton 36: Why did Yuchuang first choose CMOS substrate?
Xia Zhijin: Traditional displays such as mobile phone displays cannot achieve micron level accuracy with TFT substrate. The large screen does not need such small display particles, and this method can also be used. However, if the size of AR display screen is less than 1 inch, CMOS substrate must be used to ensure the accuracy.
Cost is an early constraint
Krypton 36: How big do you think the future market space of Micro LED display industry will be?
Xia Zhijin: Micro LED can be used in all fields. If the total market is regarded as a potential market, it will certainly be a market of hundreds of billions; If it is limited to several fields, for example, the AR field has tens of millions of shipments every year, each display unit is 100 yuan or more, and the market can reach several billion; In addition, there is room for car market and TV market, which are quite large. For example, wearable devices, watch displays, etc., Micro LED can also be used in the future.
36 krypton: Can't the cost of Micro LED used in wearable products be calculated now?
Xia Zhijin: This is a problem, involving cost and other issues. Micro LED is hard to say that it is competitive in these fields from the beginning, and there is still a long way to go. But it is really good. It is very bright in the daytime, and its power consumption is not high. It has good performance in all aspects, but its cost is very high.
36 krypton: Micro LED TV jointly launched by Yuchuang and Samsung has a price of up to 1.05 million yuan. How long do you think it will take to lower the product price?
Xia Zhijin: Micro LED has adopted a special new production process. The yield of many technologies and links is not high enough, and the cost is really high. Its cost will not drop until the whole technology is mature and the scale is up. However, upstream suppliers need to reduce their costs through scale, and the iteration of cost and high technology will also be slower. This is a mutually restrictive relationship, which can only be developed in a spiral way. It may take a long time, four or five years or more, before its price can fall to the same level as that of traditional monitors and occupy a certain market space.
36 krypton: At present, other display technology routes on the market have been relatively mature. What are the competitive advantages of Micro LED when competing with Micro LED, LCD, AMOLED, Mini LED and other products?
Xia Zhijin: Due to cost and other reasons, LCD displays occupy most of the market space in many fields. Micro LED just adds some options for us. However, in some specific fields, I think Micro LED will dominate in the future and can only be used, such as car mounted head up display. Micro LED can be curved and transparent, which is very suitable; The AR domain will also be an important scenario, and may even be the only useful solution.
Many large companies are interested in this new display. At present, Samsung and Apple rank first in the number of patents in the field of Micro LED, both of which are terminal manufacturers. They are actively doing some forward-looking research and development in this field.
36 krypton: In the car head up display scene, do you see any other solutions besides Micro LED?
Xia Zhijin: There are other routes, but everyone is in the early stage and has not seen large-scale products. Everyone is using different display schemes. Like the film on the windshield, it can be displayed by projection. I think there are two problems with projection. One is brightness, and the other is how to prevent sunlight from being damaged, because the projected light can be sent out and sunlight can also be shone in, affecting the imaging.
Krypton 36: If Micro LEDs want to scale up in the future, what breakthroughs should be made in technology and market?
Xia Zhijin: There are technical difficulties, but also the problem of mass production to reduce costs. It is very important to reduce the cost. If the cost is too high, it is difficult to apply it to consumer electronic products.
36 krypton: In this case, how do you think Micro LED enterprises can develop to go through the early stage of the industry?
Xia Zhijin: At the beginning, I think the best way is to promote some high-value products to iterate technology and reduce costs. This is why Yuchuang chose to cooperate with Samsung to make TV, because high-end TV can bear such costs.
Krypton 36: How do you think China's micro LED display panel technology compares with foreign countries?
Xia Zhijin. Some of these companies were established seven or eight years ago, and some have just been established. On the whole, the technology is still very immature and at a very early stage.
But I am optimistic about China's display industry. One is that companies like BOE and Tianma have become the world's largest players of display screens, surpassing Japan and South Korea, which is promising; Second, the display screen factory attaches great importance to the technology of Micro LED. Samsung and Apple have the most patents in the world, but BOE is also in the front. We are already investing in R&D, but there may be a long way to go from research to final mass production. China is not as backward as before, and it is closely following everyone.
Xiangfeng's investment logic: looking for solutions based on industry and market
Krypton 36: Can you talk about the layout of Xiangfeng Investment in the display field?
Xia Zhijin: We are mainly looking for upstream solutions through the application side, rather than investing in the display industry. For example, in the past, computers, televisions and mobile phones needed screens. Now, VR and AR products are available, and the head up display and vehicle mounted display products in cars have completely different requirements for display screens from traditional displays. Then we will see whether there is appropriate technology to solve such problems, or whether new solutions are needed and who is doing it. From this perspective, choose whether to invest in the display industry, and choose the technical route.
Xia Zhijin, Management Partner of Xiangfeng Investment
36 Krypton: Why did Sunfong Investment choose to invest in Sunfong Technology?
Xia Zhijin: In 2018, we invested in Yuchuang. Display has always been the focus of our attention, and we have been watching what new things come out of this industry. We have invested in Yunyinggu, which is an OLED driver chip, and silicon based micro displays, which have accumulated a lot in the field of display technology.
The AR field has always been the focus of our attention, and everyone looks good at AR, but the AR field is generally at a low stage. We believe that the hardware platform is not good enough because there are two very core technologies behind it, one is display technology, the other is waveguide technology, and no breakthrough has been made. In terms of waveguides, we have invested in optical particles with self-developed optical waveguides and display technologies.
At the display level, there are many requirements for display modules in the AR field, such as high brightness, low power consumption and small size. On this basis, we see that Micro LED has the opportunity to become the mainstream solution of AR products.
The reason why we choose the team is that they are relatively well developed. Micro LED involves a lot of process difficulties. At that time, Yuchuang already had some demo technologies. Their technologies in massive transfer and repair are not available to others. In addition, they have cooperated with their downstream customers Samsung from a very early stage, and can make product definition and process selection with the help of upstream and downstream forces.
Krypton 36: Can you give a brief introduction to the business of Yuchuang?
Xia Zhijin: There are three major application directions for its products. One is large display, 100 inch or larger display; Second, the medium size, such as about 10 inches, is mainly used on cars, such as the car's central control screen, head up display, and Micro LED, which can achieve curved display and transparent display. At present, we are discussing this project with many car manufacturers; The third is the AR/VR display, which is a tiny display.
Micro LED has many applications, not only in these fields, but also in wearable devices, watch displays, etc. Micro LED exceeds the indicators of traditional displays by a large margin in many aspects. However, due to cost and other problems, Micro LED has no competitiveness in these fields.
36 Krypton: Xiangfeng has also invested in Yunyinggu. Will Yunyinggu and Yuchuang Technology have business level linkage?
Xia Zhijin: Not really. Yunyinggu is mainly a driver. It has two products. One is AMOLED, which is the display screen used on our ordinary mobile phones. Another one is called Micro display, also called display on silicon micro display. What's more special about silicon based micro display is that its substrate is a CMOS circuit unit, and the substrate is together with the driver. Both products are based on organic materials. The micro LED display screen created by Yu is based on inorganic materials. So although one of them is a driver and the other is a display screen, they have different technical routes.
AMOLED driver, South Korea and Taiwan have teams that do a good job. The largest one in China is Yunyinggu. AMOLED driver chip is its main business.
Krypton 36: We have laid out two different pairs of technical routes. Is there any possibility of competition for the future technical routes represented by Yunyinggu and Yuchuang?
Xia Zhijin: Yunyinggu and Yuchuang are the layout of our two routes. There is no conflict for the time being, but it is possible in the future.
The silicon based micro display of Yunyinggu has been done very well in the VR field and can be applied completely; Micro LEDs still have a long way to go. So I think for a long time, OLED will be more mature than Micro LED, but it is not ruled out that Micro LED can replace it in some fields, but I think it may not be in many industries. Like Samsung AMOLED, it may have been in the market for more than ten years, but now the overall proportion is still small.
Krypton 36: What areas does Xiangfeng Investment focus on now?
Xia Zhijin: Now our general direction is the semiconductor industry chain, and we continue to invest. We have also invested in some semiconductor material companies, EDA software companies, and equipment companies to go upstream from chip design companies.
In addition, in the area of semiconductor chip design, we are also looking for enterprises. Of course, domestic substitution is a big theme, but we hope it can be innovative, not low-end, very low level.
Krypton 36: What is innovation? Is there any specific example or scope?
Xia Zhijin: Let me give you an example. For example, some of the semiconductor companies we invested in in the early years are very innovative. For example, Huizhiwei is going to be listed on the Science and Technology Innovation Board this year. It is the PA of mobile phones. Maybe many people think that making mobile phone PA is a domestic alternative, and it does benefit from this, and the magnitude rises quickly. But we first invested in it because of its patented technology. It has a technology called multi-mode and multi band, which can be used for mobile phone terminals in the 4G and 5G era. It uses a PA control amplifier to process and target different frequency bands. This was a relatively advanced technology at that time. We invested in it because of the innovation of technology itself, not because it was a semiconductor company that could make domestic alternative investments.
In the future, we will return to such investment more often. Semiconductor is not immutable. There are many new fields and new things coming out. We are willing to find and invest in these new startups. Of course, domestic substitution will help them grow faster. Unlike our early investment in semiconductor companies, it takes a lot of time to reach customers, and the income is very slow. The theme of domestic substitution can make them much faster, but it is not a decisive factor for our investment.
