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[SEMI Theater] MOCVD and LED Market Outlook
 

[SEMI Theater] MOCVD and LED Market Outlook

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Ross Young, SVP, IMS Research ...

Ross Young, SVP, IMS Research

This presentation will examine the current GaN MOCVD market and reveal MOCVD share by supplier. It will also reveal shipments by wafer size and capacity by LED manufacturer. In addition, it will reveal MOCVD supply/demand revealing how many tools will be necessary to meet future HB LED demand as well as demand trends.

Presented at the SEMI Theater at SEMICON WEST on July 14, 2010

Note: A summary Ross Young's talk is posted on his blog at: http://www.ledmarketresearch.com/blog/?p=29

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    [SEMI Theater] MOCVD and LED Market Outlook [SEMI Theater] MOCVD and LED Market Outlook Presentation Transcript

    • MOCVD and LED Market Outlook Ross Young SVP, Displays, LEDs and Lighting IMS Research Ross.young@imsresearch-usa.com www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 2 Outline  IMS Research  LED Research Strategy and Offerings  LED Demand  MOCVD Outlook  MOCVD and LED Supply/Demand  Summary www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 3 Who Is IMS Research?  Founded in 1989 by former TI UK semiconductor executives  Market research, business intelligence, consultancy and conferences  Coverage of all major electronics markets and components  Privately-owned & independent  100 employees, 80 analysts.  Headquartered in the UK with offices in Austin, Texas, Shanghai, China and Taipei. Opening new offices in Seoul and Tokyo in 2H’10. Automotive & Displays Medical Devices Transportation Communications Financial & Power & Energy ID Technologies Computer & Industrial Security & Fire Office Equipment Semiconductors & Consumer Electronics Lighting and LEDs Components www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 4 LED Strategy and Offerings  Experienced and Committed to LEDs – Covering the LED market since 1995. – Previously surveyed packaged LED manufacturers annually on their shipments by application. – Will have 9 people tracking the LED market in 2H’10 in the US, Europe, Korea, Taiwan and China. – New LED web site and blog launched – www.ledmarketresearch.com.  New and Unique Quarterly Supply Coverage – Launched Quarterly GaN LED Supply Report in January 2010. – MOCVD and LED manufacturers surveyed quarterly. – Tracking where each MOCVD tool is being installed. – Determining MOCVD supplier shipments and share by region. – Calculating wafer capacity, die capacity, yielded die capacity and binned die capacity by LED manufacturer. – Determining how many MOCVD tools are necessary to meet demand. www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 5 LED Research  Annual Optoelectronics Report  Annual LED Driver IC Report  Annual Interior and Exterior Lighting Report Coming Soon  Quarterly LED Backlighting Report  Tracks quarterly penetration by panel supplier by application as well as # of LEDs per panel  Quarterly LEDs in Lighting Report  Surveys LED and lighting manufacturers on lighting shipments by application.  Quarterly LED Shipment Report  Shipments and revenues by LED supplier by application  Quarterly LED Supply/Demand Report www.ledmarketresearch.com © Copyright 2010 IMS Research
    • LED Report Customers www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 7 LED Demand Forecast www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 8 Advantages of LEDs  Most energy efficient lighting solution.  Can reduce power consumption for general lighting by 33% according to the DoE, saving over $30B/yr.  Incandescent sales outlawed in certain countries due to poor efficiency.  Long lifetimes, 50K hours to 70% lumens.  Are inherently rugged, no filament to break.  Start instantly, nanoseconds vs. minutes for HID.  Infinitely dimmable and controllable. Source: Cree  No mercury, lead or heavy metals.  Are directional, no wasted light  No cold starting issues. www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 9 Backlighting Applications  TFT LCDs are expected to grow at a 7% CAGR to 3.8B panels.  Notebooks and TV panels are expected to grow the fastest with small/medium panels dominating in units, not area or $US. 4000 3500 Millions of Panels 3000 2500 2000 1500 1000 500 0 2009 2010 2011 2012 2013 2014 2015 LCD TVs 150 180 198 216 232 243 250 Monitors 187 198 206 212 219 223 228 Notebooks 175 216 261 310 361 415 468 Small/Medium 2055 2259 2344 2452 2572 2693 2815 www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 10 LED Penetration  While small/medium panels are fully penetrated, notebooks have rapidly shifted to LEDs followed by TVs and monitors. 100% 90% 80% 70% LED Penetration 60% 50% 40% 30% 20% 10% 0% 2008 2009 2010 2011 2012 2013 2014 2015 Notebooks 6% 46% 89% 100% 100% 100% 100% 100% LCD TVs 0% 3% 22% 45% 70% 94% 100% 100% Monitors 0% 2% 12% 20% 40% 65% 90% 100% Small/Medium 100% 100% 100% 100% 100% 100% 100% 100% www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 11 LED Configurations for TVs Source: LG Display www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 12 Edge vs. Direct vs CCFLs  Direct LEDs were implemented first and were believed to be the ultimate winner due to their excellent contrast, black level and power performance.  However, Samsung shocked the display and TV industry with the launch of edge-lit LED TVs. Few people was thinking about edge lighting after the Luminus/GLT approach failed.  Although edge lighting has trade-offs relative to CCFLs and Direct in power, cost and contrast, it has the best mix of features and a nice cost reduction roadmap. www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 13 Edge vs. Direct Share  Edge to continue to dominate through the forecast, but direct share to rise as LED prices fall.  Direct penetration led by the largest sizes. 100% 90% 80% 70% Edge vs. Direct 60% 50% 40% 30% 20% 10% 0% 2007 2008 2009 2010 2011 2012 2013 2014 2015 Edge Direct www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 14 Edge-lit Cost Reduction Roadmap  First generation edge-lit designs used as many as 6 LED modules.  Second generation has already been reduced to 4 with 2 modules expected in the near future.  This is occurring due to: – Larger die reducing total # of die and packaging costs – More efficient lightguides – Significant increases in panel transmissivity – Increases in LED and packaging efficiency www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 15 LED Backlighting Demand by Application  LEDs to grow at a 30% CAGR to 100B die led by TVs from 2011. 120 100 Billions of LEDs 80 60 40 20 - 2008 2009 2010 2011 2012 2013 2014 2015 LCD TVs 0 2 11 22 35 52 56 59 Monitors 0 0 2 3 6 8 12 12 Notebooks 1 4 8 9 10 10 11 11 Small/Medium 13 14 16 17 17 17 17 17 www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 16 LEDs in General Lighting  Determined TAM for LEDs in general lighting by determining the number of lighting sockets by application – commercial, industrial, residential and outdoor. Created 3 scenarios – base, bull and bear.  Over 40% CAGR projected from 2010 to 2020 in base case with # of LED die rising to 40B.  In addition to falling costs and power and lifetime advantages, LEDs will also benefit from incandescent bulbs being phased out around the world and government national/city subsidy programs. However, long lifetimes will affect the replacement market leading to some annual declines. 80% 70 70% 60 LED Penetration of WW Sockets 60% 50 Billions of LED Die 50% 40 40% 30 30% 20% 20 10% 10 0% 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Bear Base Bull Bear Base Bull www.ledmarketresearch.com © Copyright 2010 IMS Research
    • Total LED Demand  LED demand to grow at a 38% CAGR from 2009 – 2015 to 175B die. For lighting, using the avg. of base and optimistc.  Backlighting to continue to dominate, but its share is expected to fall from 67% in 2010 to 57% in 2015 over this period.  Lighting to dominate growth at a 102% CAGR respectively and overtake small/medium in 2013 for #2 application after LCD TVs. 200.0 180.0 160.0 Billions of LEDs 140.0 120.0 100.0 80.0 60.0 40.0 20.0 0.0 2010 2011 2012 2013 2014 2015 Backlighting Lighting Other www.ledmarketresearch.com © Copyright 2010 IMS Research
    • MOCVD and LED Supply Outlook www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 19 Importance of MOCVD to LED Manufacturing hν Sapphire removed n-GaN QW(s) p-GaN Ag p-contact Heat Heat Submount Thin Film Flip Chip LED • Accounts for >50% of LED eqpt. costs. • Color, brightness, electrical performance, costs all determined by MOCVD performance. • MOCVD is also the slowest process in the fab @ 7-8 hours per run, and is the largest contributor to yield loss. www.ledmarketresearch.com © Copyright 2010 IMS Research
    • Binning LEDs Source: Veeco www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 21 MOCVD Market Through 2009  Around 1500 reactors in operation at the end of 2009.  Annual market size was under 200 reactors per year.  2” was the dominant wafer size.  Market led by 2 merchant suppliers – Aixtron and Veeco – and Nippon Sanso which builds a custom tool for Nichia. Unit Share Regional Share Other, 0.4% Europe, 2% USA, China, 8% 8% Nippon Sanso, Taiwan, 26% 33.9% Aixtron, 46.1% Japan, 36% Veeco, 19.6% Korea, 19% www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 22 MOCVD Unit Shipments  In Q1’10, the number of MOCVD systems shipped rose 43% Q/Q to 152 units on strong demand from both the backlighting and lighting markets as well as subsidies in China.  Going forward, we expect mid-teen Q/Q growth each quarter from Q2’10 – Q4’10 resulting in total shipments of 760 units for 2010.  2011 will be marked by even stronger demand in China, continued strength in Korea and Taiwan as well as a new fab from Nichia. 250 200 150 100 50 0 Q4'09 Q1'10 Q2'10 Q3'10 Q4'10 MOCVD Shipments www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 23 MOCVD Unit Share by Region  In Q1’10, the MOCVD market was dominated by 3 regions – Korea, Taiwan and China – which accounted for 91% of the market.  Korea remained the #1 region, holding a 34% to 33% unit share advantage over Taiwan. Korea was led by Samsung, LG and Seoul Opto.  Taiwan remained the #2 region on 35% Q/Q growth led by Lextar and Epistar.  China and the US were the fastest growing regions with China doubling its share from 12% to 24% on 185% Q/Q unit growth led by San’an and HC Semitech.  US installations more than tripled, but only accounted for 9% of the market. 100% MOCVD Shipment Share 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Q4'09 Q1'10 Japan 1% 0% Europe 3% 1% USA 4% 9% Korea 45% 34% Taiwan 35% 33% China 12% 24% www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 24 MOCVD Supplier Share  Aixtron continued to dominate in Q1’10 with 97 units for the GaN market, up 39%. Taiwan accounted for nearly 50% of its shipments followed by Korea at nearly 30% and China over 20%. Aixtron is dominant in Taiwan with Korea and China much more competitive with Veeco.  Veeco’s shipments rose 33% to 48 units. Korea accounted for over 50% of its shipments followed by China at ~35%.  Other was all in the US in Q1’10. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Q4'09 Q1'10 Other 0% 5% Aixtron 66% 64% Veeco 34% 32% www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 25 Brand Share by Region  In Korea and China, Aixtron and Veeco have been splitting the market. However, Aixtron has been dominant in Taiwan.  China, Korea and Taiwan will remain the key battlegrounds going forward with China becoming increasingly important. 100% 100% 80% 80% Aixtron's Share by Region Veeco's Share by Region 60% 60% 40% 40% 20% 20% 0% 0% Q4'09 Q1'10 Q4'09 Q1'10 China Korea Taiwan Europe USA Japan China Korea Taiwan Europe USA Japan www.ledmarketresearch.com © Copyright 2010 IMS Research
    • MOCVD Trends  Boosting throughput to meet demand through: – Larger process chambers – Larger wafer sizes – Faster deposition rates – Minimizing downtime by improving chamber/injector cleanliness. Eliminating bake step for cleaning – Improving/implementing automation – robots and loadlocks becoming more common to maximize runs per day.  Improving yields through: – In-situ monitoring of temperature, film thickness and film uniformity – Improving film and wavelength uniformity, maximizing gas flow uniformity without complex tuning – Keeping process chamber/injector clean – Larger/thicker wafers – Improving tool to tool and wafer to wafer repeatability www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 27 New Aixtron MOCVD Reactors Aixtron G5 HT Reactor CRIUS II Larger chamber: 33% increase, 6 to 8 at 6“ Larger chamber: 77% increase, 31 to 55 at 2“ Faster dep rates: 17% increase Faster dep rates: 12% increase No internal bake: 32% increase No internal bake: 32% increase Total improvement: 105% throughput increase Total improvement: 160% increase Source: Aixtron www.ledmarketresearch.com © Copyright 2010 IMS Research
    • 28 Larger Wafers Also Boost Throughput  Aixtron G5 HT 2 inch wafer  6 inch wafer ~30% higher throughput Same hardware Same process Source: Aixtron www.ledmarketresearch.com © Copyright 2010 IMS Research
    • HB LED Supply  Rapid capacity growth expected from Q2’10 as significant new tools installed from Q4’09 come online.  Huge opportunities to boost output through yield improvements. 140 120 100 Billions of Die 80 60 40 20 0 Q109 Q209 Q309 Q409 Q110 Q210 Q310 Q410 Die Capacity Yielded Die Capacity Binned Die Capacity www.ledmarketresearch.com © Copyright 2010 IMS Research
    • MOCVD Supply/Demand  Supply forecast assumes no additional tools installed after Q4’10.  2010 - 760 units are not sufficient to meet demand. 164 additional units needed, shifted to 2011.  2011 - 208 tools needed to meet demand plus the 164 from 2009 resulting in 372. However, due to subsidies in China, an additional 450 tools are expected to be installed resulting in a forecast of 818 tools.  2012 – 867 tools necessary to meet demand excluding the non-demand driven tools in China. Given lower yields and utilization, expect those tools to only reduce 2012 demand by 120 tools with another 225 installed resulting in nearly 1000 tools.  2013 – Only 147 tools necessary to meet demand. However, oversupply will likely lead to lower prices and higher lighting demand resulting in higher than projected tool volumes in 2013. www.ledmarketresearch.com © Copyright 2010 IMS Research
    • Summary  LED demand is surging led by TVs and general lighting with a 38% CAGR forecasted between 2009 and 2015.  MOCVD equipment is the most important tool in the LED line.  MOCVD shipments are expected to grow by over 4X to 760 tools in 2010, nearly 50% of the cumulative installed base.  Due to MOCVD equipment subsidies in China and continued strong LED demand, MOCVD shipments are expected to continue to grow in 2011 and 2012.  The large growth in MOCVD supply will lead to additional pricing pressure in the lighting market, boosting LED demand and tool shipments in 2013. Nonetheless, a significant decline is expected in MOCVD shipments in 2013.  Veeco and Aixtron should enjoy an impressive 3-year run, unlike in any other equipment field. www.ledmarketresearch.com © Copyright 2010 IMS Research