OLED lighting: will it eventually disrupt or fade away?

IDTechEx
Cambridge, UK

The OLED lighting technology faced a difficult challenge since the
very beginning in the shape of inorganic LEDs. The challenge was that LED lighting got there first and leveraged its accumulated
production experience to improve
its performance and to reduce itscosts. This in turn created a large gap between the two
technologies that shows no signs of narrowing.

The OLED
lighting industry generally had a
confused commercialization strategy. The LED incumbents viewed OLED technology as a threat and as such invested only to hedge their bets. Some ignored
the potential uniqueness of OLED lighting, trapping themselves inthe rigid (glass-based) and/or
high-power corner of the markets.

Unsurprisingly, all these led to failures and
disillusionment. Many simply gave up
and now few committed players remain. Most notable amongst them are LG Chem and Konica Minolta. Both are from Asia and both see in OLED
lighting a way into the immense
prize that is the lighting market.

IDTechEx Research had anticipated these trends and
developments in its market
research report “OLED
Lighting Opportunities 2015-2025: Forecasts, Technologies, Players”. We had warned about the consolidation, confused
commercialization strategies and also the limited
short-term market prospects of
OLED lighting technology. Indeed,
in 2014, we forecast that the market would
be smaller than $80m by 2018 and we still think that this
will hold true.

We even
correctly modelled and anticipated the price evolution of OLED panels. We anticipated in 2013 that the
production cost will reduce to around $200/klm by 2015. This was confirmed when LG Chem announced a very
aggressive sales price of $200/klm in
mid-2015. Our model enabled us to conclude that the panels were being sold at
or below cost in order to stimulate the market.

IDTechEx Research had also forecasted that OLED lighting
will reach more than $1.8 billion in 2025 at the panel level. We still
remain optimistic about the long-term prospects of this technology. This is
because OLED lighting exhibits key characteristics of a disruptive technology: it underperforms and is overpriced
when measured on the standard industry figures-of-merit such as lm/W and $/klm;
but it can create new markets that value
novel figures-of-merit such as large areas emission, light-weight and
flexibility.

IDTechEx Research believes that OLED lighting can exploit
these differentiators to cultivate a series of niche markets and use its
accumulated industry experience to become good enough in an increasingly series
of established segments.

This process will be helped by two fundamental
characteristics of the lighting
market: enormous product diversity and importance of aesthetics. This is in contrast to, for example,
the photovoltaic market where there is little product diversity therefore
emerging technologies as OPVs find it exceedingly hard to create niches.

Ultimately, however, the future will depend on whether the
believers will keep faith through this period of disillusionment. We certainly hope that they do.