Nitto Denko and Samsung have a history together.. "Place your bets"
Nitto Denko launches counterattack against ITO film competitors
Japan’s Nitto Denko, an exclusive manufacturer of ITO film that is a core material in the world’s Touch Screen Panel (TSP) market, launches counterattack against the replacement material manufactures.
It is interpreted that they are delivering a return attack when especially Korean part companies began to successively commercialize new materials for TSP such as metal mesh, and carbon nano tube (CNT). Nitto Denko is aggressively reducing the ITO film price and they are moving on to high added-value products characterized as thin layer, high transparency, and low resistance materials. This is an action that puts pressures on Korean TSP material and part companies that successfully localized them as late starters.
According to a source in the industry on the 5th, it is known that Japan’s Nitto Denko additionally reduced the ITO film price by 5% for a major customer such as Samsung. Nitto Denko is planning to continue to strengthen the price competitiveness by significantly enhancing the productivity of ITO film manufacturing plants in Japan within this year.
The companies, which plan to supply new materials such as metal mesh, and CNT for smartphones and TSP for table PC’s during the first half of this year, appear to be extremely nervous about Nitto Denko on the offensive. Previously, the G2-type cover glass integrated TSP companies that targeted an ITP film replacement market have been ousted by Nitto Denko on the offensive.
If the price of ITO film continues to drop, smartphone manufactures have fewer reasons to adopt new materials. ITO replacement manufacturers originally planned to supply their products for prices that are cheaper by 20% to 30%. As Nitto Denko reduces the price of ITO film, however, the price gap has become smaller.
Nitto Denko particularly makes efforts to keep Samsung as their customer. Once Samsung, the top smartphone manufacturer, begins to adopt new materials such as metal mesh, and CNT, it is likely for the late starters to begin to commercialize ITO replacing materials. This will reduce the demand, which will subsequently become a direct hit on Nitto Denko.
“It is known that Nitto Denko supplies ITO film to Samsung for the least price,” said a source in the industry. “This is because Samsung is the best customer that makes large quantity ITO film purchases, and a company that sets a hardware trend.”
Samsung is planning to increase the release quantity of low to mid priced tablet PC’s this year. Samsung is developing eight TSP applied smartphone and table PC models. Even if development of some models is cancelled during the process, there is a high possibility in which two or three models will be released. It is known that the first PC with metal mesh will be released during the first half of this year. This model with a 7 or 8 inch display is the model that targets a new market such as China. While all other parts are the same, only TSP adopts the three options including an embossed, engraved metal mesh, and ITO film. It seems that the possibility of defects is considered as new materials are used.
“This is a situation in which the competition between Nitto Denko and ITO replacing materials only enriches Samsung. As for Samsung, this is an advantageous situation for them to receive materials for the lowest price,” said a stock market analyst.