Impatience with ITO replacements

10 September 2014

A report from IDTechEx says that, after five years’ development,  it is time for alternatives to indium tin oxide (ITO) to take off or fizzle out.

Over the past five years there have been a large number of companies developing transparent conductive film (TCF) alternatives for ITO. IDTech has profiled almost 100 materials and research firms, working across more than 12 types of transparent conductive film technologies, in the report Transparent Conductive Films (TCF) 2014-2024.

ITO alternatives that have gained most traction so far include silver nanowires and metal mesh options, with early leaders being Fujifilm and O-Film.

While TCFs have been targeted to many applications, most suppliers are focusing on large area touchscreens, where the incumbent solution of ITO has problems meeting the required conductivity for best performance over a large area. This is not just about competing on cost, but more viably addressing a technical issue where the existing technology falls short

Many companies interviewed have had materials/films tested and assessed for use in touchscreens. However, so far, many companies have found the uptake of ITO alternatives as disappointing. This is not due necessarily to the technology, but rather issues within the supply chain.

Following smartphones and tablets supporting touchscreens, consumer electronics companies expected that touchscreen laptops would take off quickly. Many touchscreen providers invested heavily in capacity to make touchscreens for laptops. However, these have not taken off as quickly as they had hoped. Some touchscreen makers have been running at half of capacity on new lines. Many are dragging their feet when it comes to investing in another TCF platform until they have better utilisation of existing capex expenditure.

Touch panel makers are under pressure, as customers may turn out to be competitors. Display companies, usually suffering from low margins due to intense competition in the LCD industry brought on by the surge in LCD capacity from China, recognise that a large part of value is captured by touch panel makers. Therefore, increasingly display makers seek to make their own touch modules (for example, LG makes itsr own touch screen modules.) Additionally, there is an increasing trend towards touchscreens integrated with LCDs. This may result in a reducing number of touchscreen panel makers.

Finally, big players that provide ITO on PET have been slashing prices recently, such as Nitto Denko, which increases the barrier to adoption for alternatives - at least for a while.

Many smaller companies have seen interest but no significant orders being placed. That is not to say that these companies will not see traction - the hardships in 2014 are being tackled as under-utilised capacity is slowly being filled more as the supply chain adjusts to demand.

The offshoot of this is that increasingly TCF providers seek to differentiate – otherwise the many technology options with increasingly similar performance start to only compete on price. In particular, these differentiation interests include the ability for the film to be stretched or conformed across surfaces - whether thermo-formed or injection molded, or folded around edges of devices. Others are exploring other markets, such as transparent antenna systems.

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