Updating Perspectives on Alternative Transparent Conductors

NanoMarkets has been covering the transparent conductor (TCs) market for just under a decade.  During that time we have observed the market’s initial excitement and subsequent disappointment in the prospects of ITO alternatives.  The technologies’ immaturity had a great deal to do with this failure but combined with the market’s unwillingness to adopt replacement solutions, significant corrections in the PV market, the resilience of LCD display technologies and the overpromising/underestimating by the vendor community resulted in what appeared to be another hype story gone bad.

However, within the past two years we have seen alternative TCs finally emerge as a serious business opportunity.  Not only have they improved their performance compared to ITO, but they have found a fast growing application – touch-screen sensors – whose manufactures seem willing to accept alternative TCs as much more than just a “science experiment”:  In 2014 we expect that between 10-15 percent of touch-screen sensors will use alternative TCs. And, that penetration number will only grow over the coming decade.  Since touch sensing is expected to become increasingly common for displays over the same period, it seem that touch is a good place to be for alternative TCs right now.

Alternative TCs:  Flavors of the Month

At first it seemed that carbon nanotube (CNT) coatings were a viable TC alternative, but for high performance films, they turned out to be hard to make.  Then with the much-publicized rise of Cambrios, silver nanowire inks were all the rage and these turned into real shipments to real end users.  We should also note that over the period that NanoMarkets has been covering TCs there has been a flurry of interest in graphene, but this is now universally acknowledged as a futuristic TC at best.

In 2012 and 2013, metal grids started to become an important topic of discussion in the TC community.  This was partly because of the publicity that swirled around UniPixel for a while and partly because it seemed that grids, if made fine enough, was an especially simple and cost effective solution to the TC issue.  Although mesh didn’t quite take off in 2013 as expected, enough progress was made that mesh – in one form or another – could become the dominant alternative TC going forward based on what NanoMarkets is seeing today.   Also, at the present time – and based on our interviews for this report – it seems that CNTs are back on the agenda.

With this history, it is hard to resist the belief that there is an element of fashion about how the alternative TC market progresses, with each alternative TC gets its 15 minutes of fame.  There is something to this.  However, there is also surely more and NanoMarkets believes that the alternative TC business is starting from a somewhat different technological environment than it faced in 2013.

However, we would be remiss in not pointing out how much effort the competing suppliers and providers of alternative solutions are putting into the time honored tradition of spreading fear, uncertainty and doubt about one another.  A recurring theme during many interviews seems to be how everyone else’s technology has challenges, from moire to haze to (assumed) production yields — including conflicting results about products purchased on the market & tested in-house.

They’re back – carbon nanotubes:   There are still important companies such as Linde that plan CNT-based TCs with performance and value propositions that can beat ITO.  But it has to be admitted that the whole CNT TC research program, that at various times has involved Canatu, Dow, Eikos, Linde, Toray, and Unidym doesn’t have that much to show.

As a result for the past few years, NanoMarkets has gradually extended the timeframe within which we believe that CNT TCs could become a success.  Indeed, internally, we were wondering if CNTs were simply going to miss the TC boat entirely!  That is, we thought it possible, that by the time CNTs were good enough to provide serious competition to ITO, some other alternative TCs will be well enough established that CNT TCs might be a little too late to market.

What we are seeing now, however, is a new direction for CNT TCs.  In Asia, CNTouch, has developed a new way to create CNT films for touch-screen sensors and is already supplying these films for low-end Chinese cell phones.  Although some of the shipment data that we have heard for this company seem surprisingly high, NanoMarkets has no doubt that some CNT TC development will adopt a low-cost/lower-performance strategy in the next few years and generate some significant revenues in the meantime

Meshes march on:  The old program for CNT TCs was to produce the best of the best; a TC material that could give ITO a run for the money.  By contrast, what CNTouch has done, it seems is to come to market with a low-end TC for low-end products; Chinese white box cell phones.  Reportedly, touch-sensors using this kind of TC do not perform well. However, it seems that there is a substantial market for low-performance TCs even in the west where conductive polymers have found a niche role as TCs (although not in brand name smartphones).

For the rest of the market, NanoMarkets believes that meshes are going to continue to do well.  This is primarily because it is easy to see how manufacturers can get to an end point where they can beat ITO at its own game.  In particular, the conductivity and flexibility advantages that meshes have over ITO are intrinsic and the potential for very high transparency is also strong with metal meshes.

However, in 2014 the mesh business is something of a zoo, with a growing number of offerings in silver and copper.  Indeed, the silver nanowire products of Cambrios and Carestream and the nanosilver offering of Cima NanoTech might (at a pinch) be thought of a self-creating mesh adding to the general chaos.  With this in mind, a big open question – with many possible answers – is what mesh-like solutions will the market finally settle on.  We discuss possible scenarios for meshes of all kinds in the main body of this report.

Beyond the Touch Screen:  Solar, OLEDs, etc.

Although the points made above are true in general, most of them are made in the context of touch screens, which is where virtually all the attention for alternative TC use is directed at the present time.   This is understandable because (1) at the present point only touch sensor makers are buying alternative TCs in any quantity and (2) the use of alternative TCs for the one really large TC market – LCDs is minimal at best.

But NanoMarkets believes that the alternative TC industry should be cautious about adopting even some of the more bullish numbers for alternative TC adoption in the touch-screen sector.  Many displays – including the largest – simply don’t need touch and there is a general movement in the industry to design TCs out.  While these facts are well known and understood, what is not much remarked on is that touch itself may not be forever – next generation gesture recognition may well have already begun to compete with touch in cell phones and tablets.  This would not be good news for TC makers.

Given this, NanoMarkets believes that alternative TC makers will within a few years have to shift their attention from touch screens to other markets.  And we see three possible opportunities here, although they all come with serious limitations.

OLEDs:  Today, for all practical purposes, all OLED displays and lighting make use of ITO.  However, there is a growing literature that suggests alternative TCs may have better mechanical and electrical properties for OLED devices.  In addition, the OLED sector – an emerging sector itself without fully mature processes – may be relatively open to adopting alternative TCs.

This is no sure thing though.  There are certainly no big signs of OLEDs using non-ITO TCs; just much talk about it over the past few years.  At the same time, large OLED displays continue to be hard to manufacture cost effectively, which seems to be damning the OLED TV business – a potential consumer of large amounts of TCs.

Solar:   After a horrendous couple of years, the solar industry is beginning to edge back to profitability.  Solar panels have been a potential market for TCs for a number of years and are the one market where TCs are used where ITO is not dominant.

However, the need for TCs is mostly in the thin-film PV (TFPV) space which is not where the volumes or high growth potential resides so the market for TCs in the solar depends on the uncertain resurgence of the TFPV.  Secondly, the alternative TCs being used in TFPV are primarily just non-ITO, transparent conducting oxides (TCOs).  The use of the more novel TCs in solar has been few and far between.

Flexible displays:  Fully flexible displays would represent the ultimate market opportunity for alternative TCs, because ITO wouldn’t work in them in principle.  However, no such flexible displays yet exist and ITO would work well with merely curved displays, which do exist, but are just niche products.

LCDs:  Apart from a Cambrios R&D project and some casual comments from a few other suppliers the signs of the use of alternative TCs in the LCD space are negligible – just as they have been throughout the decade that NanoMarkets has been covering alternative TCs

Makers of LCD displays with their giant fabs are not likely to want to change materials and the impact on their BOMs of such a change aren’t likely to be much.   However, even a small alternative TC penetration in the LCD space would represent a large revenue source by comparison with today’s sales of alternative TCs.  NanoMarkets therefore continues to note that the adoption of an alternative TC by a major display maker – however unlikely that might be – would make a big difference.

China Looming

NanoMarkets believes that the proverbial elephant in the TC room is now China.  A year or so back, the Chinese government tried to control the indium/ITO supply chain, but has signally failed to so.  In fact the price of both Indium and ITO has been falling (It just started to climb again as this piece was being written).

It seems difficult to believe that China will ever control the ITO supply – there are just too many potential alternative sources of Indium and ITO production is still located firmly in Japan.  However, a very real possibility is that China will increasingly become the dominant consumer of TCs as the solar, OLED, touch-screen sensors and display industries increasingly shift to mainland China as the result of Chinese industrial policy.   The recent successes of O-Film, for example, also suggests the possibility that China will play a key role in the alternative TC business in the future.