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As Tight Supply of DDI Becomes Imminent in 2020, TDDI Manufacturing Moves to More Advanced Process Technologies, Says TrendForce

12 December 2019 Semiconductors / Display Boyce Fan

According to the latest analysis from the WitsView research division of TrendForce, as electronic device manufacturers start to develop product strategies for the 2020 market driven by the commercialization of 5G technology, foundries are likewise raising their capacity utilization rates. Specifically, 8-inch and 12-inch wafer fabs of large foundries are estimated to reach near-maximum production capacities in 4Q19, thus compressing the supply of large-sized DDI and small-sized TDDI.

TrendForce research director Boyce Fan indicates that while most large-sized DDIs were previously produced at several different process nodes (0.3-0.2µm, 0.1Xµm), following two to three years of production shift, they are now primarily produced at 0.1Xµm nodes in 8-inch fabs. Foundries are starting to compress the initial supply of DDI, however, in favor of meeting the recent demand for more profitable products, such as fingerprint sensors, power management IC, and entry-level CMOS sensors. The current market for large-sized panels faces the dual problem of both oversupply and weak demand in the off-season. But these factors are expected to be counterbalanced as panel manufacturers adjust their production capacities, and TV panel ASP bottoms out. TrendForce forecasts the possibility of tight supply in the 1H20 large-sized DDI market once client demand starts to skyrocket.

Because there were significant supply shortages of smartphone TDDI in 1H18, IC manufacturers began migrating their TDDI process nodes from 80nm nodes to 55nm nodes in an effort to mitigate supply risks. However, most clients have been unwilling to adopt HD Dual Gate and FHD 6MUX TDDI, both produced at 55nm nodes in 2019, because the former suffered from product certification issues, while the latter yielded subpar product performance. As a result, most cellphones still contain 80nm TDDI chips. On the other hand, as China-based AMOLED panel manufacturers entered the mass production stage, the demand for OLED DDI began to soar. IC manufacturers are expected to concentrate their production capacity on 40nm and 28nm processes in 2020. As some of the foundries increase the production of 40nm and 28nm process nodes, their production capacity at the 80nm node is likely to undergo a corresponding decline due to equipment constraints, in turn decreasing their TDDI production. IC manufacturers are expected to begin producing TDDI at the 55nm nodes to compensate for the decline in TDDI production in 80nm nodes again.

Rising market penetration rate of high frame rate phones can help mitigate potential risks in TDDI supply

Because high-bandwidth 5G services are starting to become more widespread, and the esports industry is undergoing significant growth, smartphone brands consider high frame rate display panels (90Hz+) to be the primary differentiator of smartphone specifications in 2020. As well, IC manufacturers are restarting the production of 90Hz/120Hz TDDI ICs at their 55nm process nodes in hopes of integrating these ICs in TFT-LCD-equipped phones. In addition to TFT-LCD-equipped phones, 90Hz displays are also starting to become a major selling point in newer, AMOLED-equipped flagship models. TrendForce projects that high frame rate phones are expected to exceed a 10% market penetration rate, with the possibility of becoming the industry standard in flagship phones. As the market continues to rapidly mature, high frame rate phones can help mitigate the potential risks involved in TDDI supply for IC manufacturers in 2020.

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