May 6, 2014 1:30 am JST

Samsung hits the pause button on OLED TVs

KENTARO OGURA, Nikkei staff writer

SEOUL -- Samsung Electronics has abandoned plans for a new facility to manufacture next-generation display panels for televisions, deterred by the inefficiency of production amid intense price competition in the TV market.

     An OLED TV forms a picture on a thin, bendable layer of organic light-emitting diodes. The South Korean company released sets last year at home and in the U.S. But the products did not fare well, in large part because of hefty price tags. A 55-inch model initially went for 15 million won ($14,700).

     Samsung makes the OLED panels at a small-scale production facility at its Tangjeong complex. Investment has been called off for a larger facility that would have been in place by the end of the year.

     The inefficiency of manufacturing the panels, which account for the bulk of TV production costs, was the major culprit. The company was hard-pressed to raise efficiency and faced price competition in the TV market.

     Samsung will focus on high-quality LCD TVs for the time being. It will continue research on OLED technologies but will likely not release any new OLED sets for a while. Instead, the company is thinking about setting up a new facility to make small and midsize OLED panels for such devices as smartphones.

     The development will likely slow the popularization of OLEDs as a TV technology. The OLED TV market amounted to just 4,400 units in 2013, according to U.S. research company DisplaySearch.