Hitachi: Ready to Absorb Fujitsu Hitachi Plasma Display (FHP)

Hitachi: FHP started off in 1999 as a 50:50 joint venture between Fujitsu and Hitachi to manufacture plasma display panels (PDPs). Now, Hitachi announced that it will absorb the development, procurement and administrative operations from FHP. With giants in the LCD side of the camp such as LG.Philips LCD, Samsung, Sharp and AUO, Hitachi needs to do all it can to retrench its plasma efforts to fend them off. Or is it really. Hitachi is also a part of IPS Alpha, a consortium display manufacture that uses in-plane switching (ISP) technology that is touted as the best to deliver the highest color fidelity. Hitachi is the technology provider at IPS Alpha and they have announced recently plans to double or triple their capacity. The growth in LCD TVs is undoubtedly a lure. So, what exactly is Hitachi up to? Are they a plasma player or a LCD player? I think they are trying to replicate the success of Samsung and LG. Both of these Korean conglomerates have plasma and LCD manufacturing capabilities and both have been very successful doing both. Maybe that's what they are up to.

Back to the story: Back in March 2005, Hitachi bought out a portion of Fujitsu's stake in FHP and made FHP a Hitachi subsidiary. FHP also acquired PDP module patents at the same time. Now, Hitachi owns about 80% of FHP. Hitachi will most likely buy out the rest. That's speculation on my part. Once Hitachi owns 100% of FHP, FHP might go away or be something like a Samsung SDI for Samsung. SDI, though it has the name Samsung in front it, is a thoroughly independent unit with its own P&L and most of the time SDI is competing severly against Samsung's LCD unit. Hitachi did mentioned that the company and FHP will "implement a more unified business strategy." Hitachi will push the Wooo brand in the local Japanese market and use Hitachi worldwide. FHP will be aggressively incorporating its ALIS (Alternate Lighting of Surfaces) technology to more of its PDPs. ALIS alternately displays odd and even lines at high speeds–a faster interlacing technology that enables high-resolution images without using more electrodes.

I would like to add a bit more background to this story. On May 27, 2005, Hitachi announced that it will invest 85 billion yen to build a third PDP plant at the Miyazaki Works location. By using a state-of-the-art technology to increase panel production efficiency, the third plant's capacity will increase to 100,000 units per month by 2H'06, ending March 31, 2007. Capacity will continue to increase to 200,000 units per month by the end of FY2008, ending in March 31, 2009. Miyazaki Works' second plant has a monthly capacity of 100,000 units already. In total, by FY2006E, FHP will have a capacity of 200,000 units per month and 300,000 per month by FY2008E.

Leave a Reply