Hitachi, Canon, Matsushita align LCD panel businesses

The three companies will merge their LCD strengths to step up development of the display technologies and expand their scope of application.

By Suzanne Deffree, Managing Editor, News -- Electronic News, 12/27/2007

In the second LCD alliance in less than a week, Hitachi Ltd., Canon Inc. and Matsushita Electric Industrial Co. Ltd. Tuesday announced an agreement on their respective LCD panel businesses and technologies.

Under the alliance, the three companies will merge their strengths to step up development of the display technologies and expand their scopes of application. Hitachi brings its liquid crystal-related technologies, including its In-Plane Switching (IPS) technology, to the table, while Canon brings its experience in the camera, printer, and medical equipment fields, and Matsushita brings its leadership in the flat-panel TV field through its Panasonic brand.

The companies reported that Canon and Matsushita will, by transfer of shares from Hitachi, each acquire 24.9% of the shares of Hitachi Displays Co. Ltd., a wholly owned Hitachi subsidiary engaged in small- and medium-sized LCD panel-related businesses, by March 31, 2008. As a result, Hitachi’s stake in Hitachi Displays will become 50.2%.

The companies noted growing demand for LCD panels and intensifying competition among LCD panel manufacturers as the reasons behind their agreement. Further, Cannon specifically said that through the agreement it also aims to reinforce its digital single-lens reflex camera and various other product businesses using small- to medium-sized LCD panels in the consumer electronics, office equipment, medical and other fields. Canon also said it aims to accelerate ongoing development of organic light-emitting diode (OLED) displays by teaming up with Hitachi.

The trio of companies hinted at a second stage of this agreement that will see ownership changes at Hitachi Displays and IPS Alpha, a joint venture held by companies including Matsushita and Canon. In short, the companies said Canon will take a majority holding in Hitachi Displays, and Matsushita will take a majority holding in IPS Alpha. However, details on the future plans were not disclosed. 

On Friday, Sharp Corp. and Toshiba Corp. announced their own agreement, calling for the two to collaborate closely in LCDs. The deal extends a reciprocal procurement agreement that will see Sharp obtain system LSIs for LCDs from Toshiba and Toshiba obtain Sharp LCD modules for TVs of 32 inches and larger.

Recent market research from DisplaySearch shows that within that flat panel realm, LCD has continued to beat out plasma for consumers' TV purchases. The firm has reported that the LCD-TV market had a stellar Q3 in terms of sell-in: Preliminary totals for LCD TVs rose 34 percent from Q2 and 82 percent year-over-year to hit a new record high of 6.6 million units.