According to WitsView, a division of TrendForce, the market has witnessed stronger demand for full-screen smartphones while higher screen-to-body ratio has become a major trend of this year. In order to make bezels narrower, drive ICs for mid- and high-end phones have been switching from solutions based on Chip-on-Glass (COG) packaging to those on Chip-on-Film (COF) packaging. With major smartphone vendors actively adopting COF solutions, the percentage of models using COF packaging would account for 35% of the global smartphone market in 2019, a significant increase from 16.5% in 2018.
“In the past, most driver ICs used in smartphones adopted COG packaging, which requires more room at the bottom of display panel for chip bonding, so the bottom bezel is normally larger than side bezels and top bezel”, says Boyce Fan, research director of WitsView. However, the recent bezel-less trend on smartphones has shaped the design of panels. High-end models have started to use COF package, in which driver IC is moved to the back of display panel, thus enabling a narrower bottom bezel. WitsView notes that COF package is only used in flexible AMOLED panels previously, but will see higher penetration this year after Apple adopted this packaging technology in its 2018 new models. Other brands are expected to follow suit for their high-end models.
However, the stronger demand for COF package has resulted in a tight supply of tape, a necessary material for this packaging technology. The tapes have also seen rising quotes, which are rare in recent years. In the past, tapes are only used in large size COF panels, thus remaining in oversupply for a long time. Despite the rising number of high-end smartphones using COF packaging, WitsView does not discount the possibility that smartphone designers return to COG packaging because COF will increase the material costs for smartphones. For example, FHD+ 6MUX TDDI IC, which is currently in development, adopts COG packaging rather than COF. Considering the demand uncertainty, tape manufacturers may not be very active to expand production capacity.
With little production expansion yet higher demand for COF package from smartphone vendors, WitsView expects the COF substrates to see a tight supply. As the result, large size panel makers and smartphone makers may need to compete to secure the supply of COF substrates.