1. Severe Homogenization in Smart Terminals Makes Screens a Key Innovation Breakthrough
With the rapid development of smartphones, simple hardware upgrades can no longer meet user needs, nor can they deeply activate the market during a period of intense competition. Products have entered a stage of exploring micro-innovations. Among these, the screen, as a core component of human-computer interaction, has become a crucial breakthrough for differentiating smart terminal products. In recent years, the global mobile phone screen industry has experienced rapid growth, with market demand showing explosive growth. According to CINNOResearch statistics, global mobile phone screen shipments reached 2.93 billion units in 2016, of which touchscreen shipments reached 2.11 billion units, a year-on-year increase of 16.4%.
2. Rapid Increase in the Market Share of Domestic Mobile Phone Screen Manufacturers, Changing Market Landscape
Constrained by factors such as a long industrial chain, high upfront investment, long development cycles, and high risks, the mobile phone screen industry exhibits a clear regional clustering, initially dominated by countries and regions such as Japan, South Korea, and Taiwan. Japanese manufacturers primarily focused on the production of LCD displays and their upstream raw materials. In recent years, however, due to the market impact of OLED displays, the global market share of Japanese displays has declined. Meanwhile, driven by both government and market forces, my country has vigorously developed LCD/OLED display panels, touch modules, and other products, achieving rapid development in the smart terminal screen industry and becoming the world's largest producer of mobile phone screens.
3. Industry Concentration Continues to Increase, and Vertical Integration of the Industrial Chain is Obvious
The current mobile phone screen market is experiencing unprecedented competition, with industry profits continuing to decline. Some small and medium-sized enterprises have been eliminated due to increasing capital investment and market pressure, while leading enterprises are actively developing new profit margins through capital and business integration. The pace of industry mergers and acquisitions is accelerating, and industry concentration is continuously increasing. At the same time, with the increasing demands for thinner and lighter mobile phones and high-definition displays, as well as the maturity of embedded touch technology, the trend of integrated touch and display is becoming increasingly apparent, accelerating the integration of upstream and downstream industries.
4. Industrial Cluster Effect Begins to Emerge, and Production Capacity is Accelerating its Spread to the Central and Western Regions
my country's mobile phone screen industry is relatively dispersed, with shipments occurring in 20 provinces and municipalities across the country, in addition to industrial clusters in Guangdong, Jiangsu, and Anhui. Guangdong Province is home to a large number of leading mobile phone screen manufacturers, including O-Film, Yeji Optoelectronics, and Shenyue Optoelectronics, accounting for about 70% of the national shipments, demonstrating a clear industrial cluster advantage. However, with the continuous migration of complete machine manufacturing to inland areas in recent years, mobile phone screen manufacturers such as O-Film and Zhicheng Optics have accelerated their layout in the central and western regions, with shipments in Jiangxi and Anhui showing an upward trend.
5. Weakness in key links of the industrial chain, the industry urgently needs to improve quality, efficiency and upgrade. From the perspective of the mobile phone screen industrial chain layout, my country's mobile phone screen industry is mainly based on the module packaging segment. Domestic companies are relatively lacking in upstream key materials such as high-generation glass substrates, high-performance liquid crystals, and sputtering targets. The localization rate of key equipment such as evaporation, film formation, and laser annealing also urgently needs to be improved. At the same time, apart from some leading companies accelerating the layout of advanced technologies such as on/in-cell and AMOLED, most manufacturers still mainly use traditional bonding touch screens, with a small market share in high-value products. According to IHS Markit statistics, in the third quarter of 2016, China's AMOLED smartphone display shipments were 1 million units, accounting for only about 1% of the global market share.