Toshiba, IBM to break up LCD JV

Toshiba and IBM have agreed to end their 12-year-old LCD (liquid crystal display) manufacturing joint venture by the end of August, IBM announced Tuesday.

The 50-50 joint operation, Display Technologies Inc. (DTI), was established in November 1989 and runs production out of a Toshiba plant in Himeji and an IBM plant in Yasu. The Yasu plant is IBM's only LCD production facility.

As a result of the dissolution of the partnership, the Toshiba plant, which produces mid-to-small-size TFT-LCD (thin-film transistor liquid crystal display) panels, will become a new wholly owned Toshiba subsidiary while IBM will assume ownership of the rest of DTI, IBM said in a statement.

Increased competition and slumping demand have increased pressures on manufacturers throughout the LCD sector. The decision to break up the joint venture, which has been the subject of media speculation for months, was taken in light of the different directions IBM and Toshiba have decided to take in TFT-LDC technology, with Big Blue focusing on larger, higher resolution flat-panel screens, IBM said.

Last week, IBM launched what it calls the world's highest-resolution flat-panel monitor, the IBM T220, which features a 22.2-inch screen, with 200 pixels per inch for a total of 9.2 million pixels at a price of $US22,000.

The LCD monitor, which IBM says shows 12 times more detail than current monitors and produces screen images that are as clear as an original photograph, is being aimed at such industries as science, banking, engineering, publishing and medicine.

Toshiba recently signed a joint venture with Matsushita Electric to produce LCDs in Singapore. IBM and Toshiba maintain several other partnerships, including a recently announced joint venture between the two firms and Sony Computer Entertainment Inc. aimed at developing a 1T flop-class consumer microprocessor within the next five years When IBM takes full ownership of DTI by September, the company will have 600 employees with 10 billion yen ($US80.45 million) in planned capital, IBM said. Toshiba's new subsidiary will also have 600 employees, though its new name has yet to be decided, IBM said.

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Laura Rohde

PC World
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