Sony and Toshiba May Merge Small/Medium Display Operations

The Wall Street Journal: Innovation Network Corp. of Japan is urging Sony and Toshiba to merge their small/medium display business operations. INC will invest in the merged operation and take majority share in the range of 70 to 80%. It remains unclear whether or not Sony and Toshiba will accept Innovation Network’s proposal. Earlier on Tuesday, the Nikkei reported Sony and Toshiba were in the final stages of negotiations for the merger of their small/medium display operations.

The combined small/medium display operation would help both Sony and Toshiba compete against LG Display, Samsung, Hitachi/Foxconn, and Sharp. Sony and Toshiba will also combine their individual OLED research and development activities. If the Innovation Network gets its way the combined organization is expected to form before the end of 2011, at which time Sony Mobile Display and Toshiba Mobile Display will cease.

Smartphone shipments are increasing much faster than the overall mobile phone market. The tablet, like the iPad, is a brand new category that is eating up netbook and small notebook sales and is expected to do so for quite some time. It is not surprising that smaller display manufacturers are jockeying for position to take full advantage of explosive growth in these two product categories.

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