Televisions

The Unstoppable Rise Of LG TVs (There’s No Catching Up)

https://www.youtube.com/watch?v=m_LCI2rFDUY

Source: Youtube Logically Answered

In the early 2010s, OLED was a dead end. Too fragile, too expensive, and impossible to scale. Who would pay $10,000 for a TV? But today, OLEDs are everywhere. Every major company backed off… except LG. Not only do they own half the OLED market today, but they also make OLEDs for Samsung and Sony. What happened? What did LG see that no one else could? And for anyone else, catching up might already be too late.

All In

To understand why LG’s OLED gamble was so risky, we need to go back to the 2000s. The market was dominated by two technologies: Plasma and LCD. Plasma TVs offered incredible picture quality with deep blacks and vibrant colours. But they had serious problems. They were power-hungry, generated tons of heat, suffered from terrible burn-in, and were expensive to manufacture. LCD TVs on the other hand, were easier to produce, more energy-efficient, and far far cheaper. It didn’t look quite as good, but most customers settled for “good enough” when the price was so great. Companies like Samsung were producing millions of LCD panels, driving down costs and improving quality. In the first quarter of 2008, 2.8 million Plasma TVs were sold, compared to 21 million LCDs. Shortly after, LCD TVs had over 10 times the sales volume.

And that brings us to LG. LG engineers were looking at a third option. Enter: OLED or Organic light-emitting diode panels. Each pixel produced its own light and could turn completely off. It had perfect blacks, infinite contrast, instant response times, and the viewing angles were perfect from any direction. OLED wasn’t new either; researchers had been working on organic light-emitting diodes since the 1980s. So, why wasn’t OLED the standard? Making OLED work for large displays was an entirely different challenge. Plasma and LCD manufacturing had challenges with engineering and economics, but OLED? These were problems of physics and chemistry. The organic materials degrade much faster than LCDs, and the yield rate of manufacturing was abysmal. Often over half the panels on a production line had to be scrapped. Making tiny OLEDs was feasible, but the 55-inch TVs and larger that customers actually wanted were nearly impossible. To make OLED profitable, the TVs would need to sell for tens of thousands. LCDs, on the other hand, were growing less expensive by the year. OLED just wasn’t practical. So, most companies looked at OLED as an interesting lab experiment that would never be commercially viable. Except LG. LG, for some reason, was motivated by the challenges. Despite the obstacles, they saw the potential. Unbeatable quality, light, and colour. They saw OLED as the future of television. In December 2009, LG did something unexpected: They purchased Eastman Kodak’s OLED patent portfolio for $100 million. Over 2,200 patents, some based on research from the 70s and 80s. LG was officially betting on OLED. And not as a side project either, but as their primary focus for the premium TV market. But the financial pressure was intense. LG Display was pouring billions into OLED research and manufacturing while their competitors were making money on LCD. Analysts questioned whether consumers would ever pay the premium necessary for OLED, when LCD technology was getting better and cheaper. LG was betting that picture quality would eventually matter more than price, but was it even worth it? Every year, month, and even day that LG worked on OLED, their opponents were making more LCDs and getting better at it. Then came LG’s first OLED TV.

Doubling Down

LG’s first OLED TV, a 55-inch model, had a price tag of, wait for it, $15,000. Sounds absurd, but OLED really was that expensive. In fact, LG’s manufacturing costs were so high that they were barely breaking even on each panel. LG’s factories would start with massive sheets that could make dozens of TVs. But most ended up as scrap, dead pixels, uneven screens, colour problems everywhere; the defect rate was astronomical. But, LG wasn’t about to give up. Their engineers had made a breakthrough. LG’s engineers developed something called a WRGB OLED approach. Instead of pixels just having the traditional red, green, and blue, for OLED, LG also added a white pixel too. And this ended up being huge. [LG Display]: “Compared to RGB OLEDs, WRGB OLEDs require 50% less investment in facilities and equipment with a higher yield rate. Clearly, WRGB OLEDs are ideal for large-screen TVs due to their quality and cost benefits. Yet the technical problems went deeper than manufacturing. OLED panels, like Plasma, suffered from burn-in, where static images could leave a faint, permanent mark. In retail stores, this was a death sentence. TVs might display video game interfaces, ultra high-res photos, or channel logos for hours. But it got worse. LG’s competitors jumped on these problems as marketing points. Samsung began promoting their QLED technology as “burn-in free” while highlighting OLED’s reliability issues. Sony continued investing in their high-end LCD technology. LG, however, was still barely making any profits. Consumer adoption was painfully slow. Even wealthy early adopters were hesitant to spend $15,000 on a TV that might not even be reliable. So, how were OLEDs selling? In 2015, OLEDs sold a total of 2.7 million units. Might sound like a lot, but that’s less than 1% of the market. LG had been at this for a while now, yet still had little success. The mainstream market wasn’t even considering OLED; they were buying 50-inch LCD TVs for under $1000. The WRGB pixel technique had solved part of the issue, but they had to solve the manufacturing crisis or abandon OLED entirely. But then came another breakthrough. OLED manufacturing meant depositing delicate organic materials onto glass in spotless facilities. It was an extraordinarily delicate process. Even a tiny bit of dust could cause a short or dead pixel. So LG started using an “evaporation” process. The organic molecules are heated, vaporized in a vacuum chamber, then travel and condense onto the glass with the backplane. You can see why LG took so long to perfect this. But they finally figured it out. By 2016, LG’s manufacturing yields had improved from roughly 50% to over 80%. This was a technical achievement and an economic transformation. Suddenly, LG could produce OLED panels at costs that made premium pricing sustainable rather than desperate. After years and years of experiments and billions of dollars, LG had finally done it. Then, things began to steamroll. Panels lasted longer, burn-in became rarer, and brightness got closer to high-end LCDs. LG’s OLED could finally compete with LCD on every front, not just picture quality. LG was about to come out swinging. The question now was whether the market would finally embrace what LG had built. Or would it be all for nothing?

The Empire

In 2017, LG Electronics launched the C7 OLED, and everything changed. This was the first OLED TV that delivered on the technology’s promise without major compromises. The C7 combined LG’s improved panels with smart TV software that actually worked and a price point under $3,000 for a 55-inch model. Yet, something else was happening. Netflix was investing millions in 4K content, gaming was becoming more sophisticated, and people were spending more time at home. The premium TV market was exploding. Suddenly, that perfect black level and infinite contrast ratio had huge demand. But the real genius was the marketing. LG understood that OLED wasn’t competing with budget LCD TVs; it was competing with premium LCD and the entire high-end home theatre market. Plus, their competitors had their own problems. TVs, in some ways, were becoming too cheap. Giants were now being outpriced by TCL and other newcomers, who offered bigger screens and pretty good quality. So competitors began focusing elsewhere, like smart TV interfaces and voice control. But not LG. LG was essentially competing in its own market. They focused entirely on picture quality, and no one could match them. Even then, Samsung wasn’t going to surrender the premium market without a fight. In 2017, the same year LG’s C7 OLED was winning awards, Samsung launched their most aggressive counter-attack yet: QLED technology with quantum dots and dramatically improved brightness levels. Samsung’s strategy was clever. They couldn’t match OLED’s perfect blacks, but they could absolutely destroy OLED on brightness. This was a problem. For consumers shopping in bright showrooms, Samsung’s displays looked far more impressive. Samsung spent millions promoting QLED as “brighter than OLED.” They created side-by-side demos in retail stores, which deliberately favoured Samsung. The bright showroom lighting washed out OLED displays, while making QLED look vibrant and punchy. For a moment, it looked like Samsung’s strategy might work. Samsung’s QLED TV unit sales rose from 2.6 million in 2018 to 5.32 million in 2019, more than double. But Samsung had a fundamental problem: QLED was still based on LCD technology with quantum dot enhancement. No matter how much they improved the backlighting and color accuracy, QLED TVs still couldn’t produce true blacks, still had limited viewing angles, and still suffered from backlight bleeding in dark scenes. Meanwhile, LG kept improving OLED technology. Each generation got brighter, more reliable, and cheaper to manufacture. Yet, the final turning point came in 2020.

With people spending more time at home, picture quality became everything. Consumers were watching movies in dark rooms where OLEDs were unbeatable. The momentum began to build. In 2018, 2.52 million OLED TVs were sold, which grew to 3.0 million in 2019. Then, 3.84 million in 2020. Then 6.52 million units in 2021. And then came the surrender. In 2023, Samsung quietly announced they would begin using LG Display’s OLED panels for their premium TV lineup. Turns out OLED was superior after all. The battle was over. The market had spoken: OLED was the future of premium television. And LG Display was the only company that could manufacture it at scale. Today, LG Display controls over 52% of the global OLED TV market, but that number doesn’t tell the whole story. Sony’s acclaimed Bravia OLED TVs use LG panels. Samsung’s new OLED lineup? LG panels. Even brands like Panasonic and Philips rely on LG Display for their premium offerings. The bet had paid off. And catching up is now virtually impossible.

The company spent over a decade perfecting OLED manufacturing, while its competitors focused on improving LCDs, in a race to the bottom. LG Display has even sold off its final LCD plant to focus entirely on OLED, a commitment no competitor can match without enormous risk. The companies that dismissed OLED as impractical are now LG Display’s biggest customers. LG had won OLEDs.