Oled Lighting Trends And Opportunities

OLED Lighting Trends and Opportunities
A Webinar for the FlexTech Alliance
August 2, 2011

NanoMarkets
thin film l organic l printable l electronics www.nanomarkets.net

© 2011NanoMarkets, LC

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About NanoMarkets LC
• NanoMarkets provides industry analysis of emerging markets
in energy and electronics enabled by new developments in
materials science. We have been covering OLED lighting
markets for five years and provide coverage of both materials
and the OLED panels and luminaires themselves
• Our work includes market, company and technology analysis,
market forecasting and due diligence. NanoMarkets provides
an updated forecast for the OLED lighting market every nine
months.
• Offerings include reports, custom consulting,
seminars/webinars and in-house training. NanoMarkets is
based in U.S., with extensive contacts all over the world

NanoMarkets
thin film l organic l printable l electronics
© 2011, NanoMarkets, LC www.nanomarkets.net

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NanoMarkets’ Recent OLED Lighting Reports
• OLED Lighting Products and Market Strategies (3/10)
• OLED Lighting Materials Market: Trends and Impact (10/10)
• Transparent Conductors in the OLED Industry: 2011 and Beyond
(11/10)
• The Business Case for OLED Lighting (12/10)
• OLED Lighting in Asia (4/11)
• OLED Lighting in Europe (5/11)
• OLED Lighting Global Market Forecasts (5/11)
• Markets for OLED Materials (6/11)

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Some Forecasts for Total OLED Lighting
Revenues
• NanoMarkets (U.S): $4.8 billion by 2016
• Analysis Atelier Corp (Japan): $7.5 billion by 2015
(NanoMarkets $2.6 billion). Large sales outside of Asia,
Europe and the U.S. Personal illumination devices
• Lux Research (U.S.): $58 million by 2020. High costs
keep OLED lighting luxury items

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Questions Answered in Today’s Presentation

• What is it reasonable to believe about the future of OLED
lighting?
• Where can OLEDs find competitive advantage in the lighting
market?
• What segments of the lighting market can they compete in?
• Two plausible low-end market scenarios for OLED lighting:
– Scenario one: The worst that can happen
– Scenario two: How far can niche markets take OLED lighting
• How can OLED lighting replace “light bulbs”?
• OLED lighting market as mass market: Some market forecasts

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Where are we now?
. . . a sanity check
• Many developments in last two years
• As many as 40 companies including majors (GE, Samsung, LG,
Mitsubishi, Philips, Osram, etc., etc., etc.) involved
• Designer kits available for more than two years
• A few dozen luxury luminaires (often from European
designers) are available from high end retailers or have been
built for custom applications.
• Luminaires are now thousands of dollars not tens of
thousands

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Selected European OLED Lighting Design Projects and Products
Product Designer Comments
Airabesc Osram Contains 11 Orbeos rectangle panels and six LEDs. The lamp comes in black, white or
polished aluminum
Aston Martin Jason Bruges Large OLED lighting installation to show off latest Aston Martin car. Uses Philips OLED
Showroom panels
Cluster + Benwirth Licht Combines both LEDs and OLEDs. The OLED panels are the Orbeos panels sourced from
Osram. Won the Design Plus Aware in 2010 and the 'Best of Best' Interior Innovation
Aware 2011.
Double C-Future Ingo Maurer High-tech pendent lamp featuring nine suspended Orbeos OLED panels
Early Future Ingo Maurer The very first OLED luminaire; a table lamp resembling a tiny tree with OLED leaves
Edge Amanda Levete Collaboration with Philips using Lumiblade. It is manufactured by Establish & Sons and
sells for €2,200
Flat Lamp Tom Dixon Collaboration with Philips in the form of minimalist OLED lamps
Jumping Flash Novaled Transparent OLED lamp design, called the "Jumping Flash". This uses five transparent
white OLED panels (10x10cm each), with the entire lamp being expandable like a
accordion
Lamped D Signed (Irena Kilibard) Uses OLED panels from Fraunhofer and has been shown at a London design festival
Mimosa Jason Bruges Light sculpture using Philips panels which showed at the SuperStudio in Milan
PirOLED Osram This luminaire costs €9,800 and again uses both LED and OLED lighting; in this case it has
five Orbeos panels and five LED lamps.
Samothrace Blackbody Battery-operated OLED Blackbody available in a "limited edition"
O'Leaf Developed by Philips Can be a table or wall lamp and sells for €1,200 to €1,400
with Modular Lighting
Instruments
"You Fade to rAndom International Light sculpture using more than 900 of Philips' Lumiblade panels. A limited edition of this
Light" installation is commercially available

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Regulation: Market Boosts and Distortions
• Phasing out: EU will have phased out incandescent bulbs by 2012, with
halogens gone by 2016. U.S. says lighting must be 25-30 percent more
efficient than today’s bulbs beginning in 2012. More draconian U.S.
requirements expected for 2020
• Doesn’t impact early OLED lighting introduction. Luxury lights not
deployed because of regulations
• Early market maturity. Government regulations accelerate the market
opportunity, but also market maturity and saturation. This must be taken
into consideration in corporate strategies. Even on optimistic scenarios,
saturation of general lighting market begins to impact the market by 2014
• Perverse economics. California utilities have chosen to meet regulatory
mandates by heavily subsidizing CFLs to a point where they are almost as
inexpensive as incandescent lighting. So a lot of CFL bulbs are being
bought in California and sold in other states

NanoMarkets

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Business Challenges for OLED Lighting
• Immature technology with no settled manufacturing approach or
customer awareness. Unusual form factor makes comparisons difficult
• OLEDs significantly lag the competition. Past improvements have been
swift. But how far can we go? Efficacies above 100 lm/W?
• Costs per kilolumen are now so high as to rule out useful comparisons on
a total cost of ownership basis
• LEDs can directly capitalize on standard semiconductor industry
processes. Can printing R2R processes deliver lower costs?
• Light output (i.e., luminance) needs to be higher to achieve significant
market penetration in general lighting and backlighting sectors
• No clear product strategy to make OLED lighting into plug and play
replacement for conventional lighting

NanoMarkets

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OLED Lighting and the Economy
• Positive: Energy prices. Energy prices rising again and are likely to
continue to rise in real terms as the Indian and Chinese economies
grow.
• Negative: Lack of investment money. Large lighting/electronics firms
are investing in OLED lighting, but better times might have seen more
VCs. Future inflationary conditions could hurt investment once again.
• Negative: Slump in new construction. The construction market in the
U.S. and Europe is improving only slowly at best. Boom in China is
ending. Lighting expenditures are strongly tied to construction activity

NanoMarkets

Unique Value-Added Features of OLED Lighting
OLED lighting special Short-term Impact Long-Term Impact
feature
Form factor Large-area panel Ability to replace Larger panels than can be achieved
format and thinness existing recessed now with more total light output.
lighting panels with Eventually, there is the possibility
more even lighting and of very large light panels that cover
no need for recessing an entire wall of ceiling.
Conformability Flexible Novel designs for Conformal panels for large area
chandeliers and table coverage, mobile/rollable lighting
lamps of various kinds. Also lighting
flexible signage and packaging
Transparency OLEDs are potentially Novel designs for Smart windows and window
transparent lighting treatments

Tunability Color tunable. This Could be used for Could also be used in smart
capability is shared adjustable mood windows and window treatments
with ILEDs and lighting

NanoMarkets

Business Cases for Flexible OLED Lighting Products
Product Business Case
Residential lighting Flexibility may play the role of more effectively creating new aesthetics or better creating
the mood lighting effect. This is an area waiting to be explored by lighting and interior
designers.
Large lighting panels OLED lighting is uniquely capable of providing large lighting panels that could cover an
entire wall or ceiling. As the size of OLED panels increase they will have to be mounted on
surfaces that are not entirely flat which will provide good reasons for OLED lighting panels
to be flexible or conformal. This need would be enhanced if OLEDs were used on outdoor
surfaces, but this is also not yet possible
Integrated lighting Incorporating lighting into both curtains and clothing is not well developed. Such products
have used collections of ILED lights stitched to fabric. OLEDs would be a good substitute.
Business cases for OLED lighting for fabrics can be based on aesthetics and fashion, but
there will also be practical advantages such as visibility of people who work or travel in
dark areas.
Extended light strips These can be used to provide low levels of light to guide people in darkened area such as
movie houses. They currently exist and use small fluorescent lights or ILEDs. OLEDs
might make an attractive replacement for these technologies.
Brand enhancement Not a road much travelled, but we believe that if costs for OLED lighting are reduced
and packaging sufficiently (perhaps using printing), it could be added to smart packaging either for brand
products enhancement or more practical applications such as indicating package tampering or (for
pharma packaging) amounts of pills used.

NanoMarkets

Comparison of Light Source Parameters 13

Fluorescent ILED OLED
Efficacy 80-100 lm/W 80-130 White Currently 25-60 lm/W but could rise to over 100
lm/W.
Wattage CFL 15 W 1.1W Packaged white LED Presumably wattages of OLED luminaires will
Linear fluorescent 95W 10.5 W LED lamp emerge in the 5W to 15 W range
Luminous Output CFL 950 lm 85 to 140 lm Packaged white Current standard for OLED panels is 3,000 lm/m².
Linear fluorescent 2,900 lm LED. 650 lm LED lamp To expand to 10,000 lm/m² by 2015. (DOE)
CRI 80-85 80 –white 95 has been achieved at 40 lm/W. OLED materials
90 warm white promise some competitive advantages in this area
Glare Mediocre N/A Potentially excellent
Cost of Low because of high volumes Low because of high volumes Potentially very low through the use of R2R and
manufacturing printing processes
Total cost of Mediocre but better than At present somewhat better Potentially excellent
ownership incandescent than a CFL
Environmental/ Dubious because of mercury Burns very hot, otherwise good Potentially excellent
Safety
Form Factor Gas filled tube (traditional or Chip – high intensity point light Large area ultra-thin panel
compact) source
Lifetime (LT70) 8 50-60 5-20 at present. Big improvements expected; 30-
(khours) 50 expected in the next few years. 100 is possible
Dimmable Yes, with special dimmers but Yes and efficiency increases Yes and efficiency increases when dimmed
efficiency degrades when dimmed
Color tunable No Yes Yes
Flexible No Limited Inherently flexible
Noise Yes No No
Switching lifetime Poor Excellent Excellent

NanoMarkets

OLED Lighting: Markets and Timetables 14

Market/Niche Business Case Challenges Timing
Luxury lighting Capitalize on existing channels and There is only so much that Some products now, but take-off
wealthy consumers. Price not can be done with small rigid likely in 2011 and beyond
major factor. Product types OLED panels
established
Mood lighting Fits well with the panel format/low- Cost, achieving flexibility, Expect to see product
luminance of OLEDs. Flexibility and and establishing marketing development in the 2012 and
tunability also important channels for new product beyond timeframe
Office and factory Offers a replacement for Luminance, energy Higher luminance and larger
lighting fluorescent lighting with smoother, efficiency and panel size panels than can now be
higher quality light and improved achieved. Perhaps not until 2014
aesthetics or 2015
Architectural Likely to include premium products The need for large panels is Some projects soon. Significant
Lighting and large panels a major challenge market evolution beyond 2012
Smart Windows Novel products, such as windows Transparency , flexibility and Not a focus of any firm at
and Textiles that are lights at night, may offer integration technology. present. Could emerge beyond
cost savings and aesthetic Marketing for novel 2015
advantages products may be hard
Automotive Replacement of existing EL Automotive industry is cost Several firms working in this
lighting technology in dash with higher sensitive with regard to space now, but first products not
luminance products. Mood lighting components likely to emerge until 2012 or so
for cars

NanoMarkets

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Other OLED Lighting Markets

• “Designer kits.” Osram, Philips and Lumiotec currently offer. Attempt to
create market. Not a product in itself

• Signage. Mainly EL replacement for emergency lights, etc. Some products
available already. OLEDs not the best choice for outdoor signage

• Backlights. Mainly alternative for simple backlights for watches,
segmented displays, etc. Replacement of backlighting for AM LCD displays
seems unlikely, although widely talked about at one point

• Packaging, toys and novelties. Includes everything from high-value
(pharmaceutical or perfume) packaging to Christmas ornaments

• Outdoor lighting and signage. Main challenge is encapsulation

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Key Forecast/Scenario Assumptions
• Regulation. Regulations phasing out incandescent bulbs will open up
markets for OLED and LED penetration. Note: There are still some
uncertainties about how fast regulations will actually be implemented
• Addressable markets. Lighting unit shipments will decline as SSL
deployment raises average lifetimes. So OLED lighting business cases must
be built around a declining addressable market.
• Pricing. Most uncertain part of the forecast is pricing. Even the basis for
OLED lighting pricing is uncertain. It is hard to compare with conventional
and ILEDs, because of panel format. $ per square is not appropriate to
other kinds of lights.

NanoMarkets

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Summary of OLED Lighting Market by Application
12,000

Other

10,000

Signage

8,000

Personal ilumination
products
$ Millions

6,000

Vehicular Lighting

4,000

Architectural and
specialized industrial
2,000 lighting
General illumination

0
2011 2012 2013 2014 2015 2016 2017 2018

NanoMarkets

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Pricing Issues and Strategies
• OLED lighting is further behind other kinds of lighting in terms of pricing
than any other parameter.

• Fluorescent lights are just $2-4 per kilolumen and LEDs are about $130 per
kilolumen. But OLEDs are around $300 per kilolumen (DOE numbers)

• Major improvement expected and DOE says $8-9 for OLEDs by 2015. This
assumes a lot about processes, materials and economies of scale, but
would make OLEDs competitive for premium general lighting products

• In NanoMarkets’ forecasts we assume that something like the DOE pricing
scenario can be achieved. Some observers believe that OLEDs will be able
to do better than this

NanoMarkets

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Company Product Pricing
Add-Vision Direct materials cost based on Add- Cost of emissive areas of $0.24 per square inch,
Vision's semi-proprietary materials and and just $0.08 for non-emissive areas
processes
Kaneka Kaneka will offer OLED square panels Said to cost around ¥2 million (approx. $24,000)
in five colors (warm white, red, per square meter—and the company believes that
orange, blue and green) the price will drop to ¥200,000 ($2,400) in 2012 and
to ¥50,000 ($600) or less by 2020
Lumiotec Designer OLED kits "Version 2.0" 145 x 145 mm kits are $360.
Modistech Currently selling a 150 x 150-mm white Modistech has said that its OLED lights will be
lighting "film" in Korea. available for around $212 per square meter by 2011
Philips Lumiblade designer kit OLED driver and electronics is priced at €70 ($93),
with small pre-shaped OLEDs ranging from €72 to
€248 ($96 to $330)
Osram Orbeos product €250
TechnoCorp Future products Goal is $65 per square meter
OLED100 EU R&D project aims to create OLED The target cost of these modules is €100/m2
lighting devices with 100-lm/W ($133/m2) or less
efficiency, more than 100,000-hour
lifetime and 100-by-100-cm module
size.

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OLED Lighting Scenario I: EL Replacement --The Worst
That Can Happen
• The actual worst that could happen would be that OLED lighting never
proves viable and disappears as a research program in a few years

• But OLEDs seem to be superior to EL lighting in many applications and also
seem suited to luxury lighting; they are getting the attention of designers

• Luxury lighting can never be a big market. A few thousand units at
$1,000+ per luminaire and over, puts market in the tens of millions of
dollars once developed

• OLEDs could be positioned as next-generation EL. EL lighting is a slow-
growing market of around $200-300 million. If OLED lighting gets 70%
share it would generate up to $210 million; a lot more than luxury lights

NanoMarkets

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OLED Lighting Scenario II: Mood Lighting --Mass Market
• Mood lighting is the first possible mass for OLED lighting. It’s performance
fits market needs and addressable markets are large; potentially many
millions of units

• The “proof” is that the luminance of OLED lighting is already close to being
suitable for mood lighting and the panel format is also a fit. Flexibility
would also be helpful, but not essential

• Addressable markets would expand rapidly as price declines. But there
are relatively price insensitive markets (transport, prestige buildings, etc.)
that are ready for it now

• Mood lighting markets could reach several hundred million dollars, making
OLED lighting a significant opportunity for major lighting, electronics and
home products stores

NanoMarkets

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OLED Lighting Scenario III: Breaking Into General Lighting
• LEDs have been made to fit in with existing formats. Consider LED “bulbs” and
“tubes.” This will be hard – but not impossible – for OLEDs. OLED lighting is
intrinsically panel-like

• Breakthrough will come if OLEDs can be made into panels that can replace
fluorescent panels. This probably won’t happen until 2015, when these panels
are large enough (maybe 1,600 m²) and bright enough (10,000 lm/m²) to do
the job

• Replacing CFLs in residential lighting will require a radical acceptance of total
cost of ownership by residential consumers. This will not be easy to achieve,
because it is unclear how consumers discount for future cost savings. But light
quality might be a compelling advantage for OLED lighting

• Major firms including GE and Philips see mass markets emerging around 2015

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NanoMarkets’ OLED General Lighting Forecast
($ Millions)
2011 2012 2013 2014 2015 2016 2017
Worldwide consumption 16.2 15.3 14.4 13.4 12.3 11.2 10.1
of light bulbs, tubes and
panels (billions)
Penetration by OLEDs 0.0005 0.0026 0.0083 0.033 0.12 0.42 1.30
(%)
OLED panels shipped 0.08 0.4 1.2 4.5 15.2 47.0 131.2
(millions)
Price per panel ($) 400.0 300.0 207.0 142.8 92.8 58.5 35.7
Market ($ millions) 31.6 120.0 248.4 637.6 1,410.7 2,749.8 4,680.0

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The Devils Advocate: How Seriously Should You Take
These Forecasts?
• Assumes good technological progress on OLEDs over next few years, along
with success of early manufacturing plants. Technological progress has
been impressive so far, but we can’t be sure it will continue and OLEDs still
lag behind LEDs and CFLs

• Assumes good customer acceptance. This is far from proven as yet.
Indeed, most potential customers don’t know that OLED lighting exists or
even, in many cases, that incandescent lighting is being phased out

• Ramp up to 2014-2015 mass market take off, could be too optimistic. This
could make the years 2013-2015 much lower revenues than we show
here. On the other hand, our penetration assumptions are quite modest,
so eventual revenues could be significantly larger. The next iteration of the
NanoMarkets OLED lighting forecast will take a more granular look at the
likely market evolution

NanoMarkets

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Some Conclusions
• Significant technical, materials and marketing challenges ahead. Forecasts
rely on economies of scale, R2R manufacturing successes, materials price
declines and customer acceptance. They also rely on the kind of OLED
lighting products that are likely to emerge
• OLED lighting does not seem likely to compete with CFLs and LEDs on
conventional parameters, except color quality in the foreseeable future.
Must therefore compete on unique features: panel format, flexibility,
tunability and transparency
• The medium-to-long term market opportunity for OLED lighting is contingent
on regulations phasing out incandescent bulbs. But this will also lead to
early saturation of the market
• At the very least, OLEDs should be able to capture EL alternative market,
plus luxury lighting market. Mood lighting market seems likely too. To meet
the expectations of large players, OLEDs need to create cost effective panel
lighting for general lighting

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Lawrence Gasman
Lawrence Gasman is the Principal Analyst at NanoMarkets and one of its co-founders. He also
heads up NanoMarkets’ OLED lighting industry research program.

Mr. Gasman's consulting clients have included multinationals, start-ups and investors and he has
advised them on new product introduction, market positioning and strategy, and sales potential.
He has also provided due diligence on mergers and acquisitions for his financial clients and serves
on the technology advisory board of a major specialty chemicals firm.

Mr. Gasman has also spoken and written widely on the subject of new materials markets. His
recent appearances have included talks at Semicon West, 2011Flex, and LED/OLED Lighting Japan.
Mr. Gasman's latest book is on the commercialization of nanotechnology for Artech House.

Mr. Gasman was educated at Manchester University, The London School of Economics and
London Business School.

NanoMarkets

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Contact

NanoMarkets, LC
info@nanomarkets.net
www.nanomarkets.net
Phone: 804-360-2967

NanoMarkets

Oled Lighting Trends And Opportunities

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