Rebirth of Northland Technology

July 1992

Czech and Slovakia split, China formally joined the "World Copyright Convention", and the Spanish Olympic Games

92 years of college entrance examination

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NDI, meeting room.

A group of business elites are in a meeting.Discuss the issues of productivity and yield.

The TFT-LCD market gradually opened up and was accepted by the market.There are already a number of notebooks on the market that have begun to use this high-speed LCD.

However, the influence of these brands is too small, and has not become a climate until the appearance of xBM.

Following in the footsteps of xBM, a number of mainstream manufacturers are also preparing to launch their own TFT notebook plans.The TFT-LCD market is about to take off.

This meeting is to discuss the issues of capacity and yield.

Historically, due to the bottleneck of production capacity and yield, the two shareholders of NDI have already discussed capital increase in NDI at this time.

The output of TFT-LCD has become the biggest constraint restricting the output and sales of xBM notebooks.As a result of the discussion, the two companies decided to increase capital by 400 million U.S. dollars to help NDI expand production and build new production lines.

None of this can happen.

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"A colleague from the marketing department found out that xBM received a batch of low-priced LCD panels. The customer has transferred some orders to a new supplier."

The beginning of the meeting was bad news.

"Low-priced panel? Is it a panel with an excessive dead pixel rate? Which one is so non-professional?"

Due to the high market price of TFT-LCD, some LCD screens with a defective pixel rate of more than 5 have also flowed to the market through various channels.

This kind of screen should have been destroyed, and the cost is very low.It stands to reason that this kind of screen, at most, only flows to third world countries, how can it go to xBM.Isn't this cheating!

"The strange thing is that this batch of screens is said to have very few or no dead pixels!"

The reason why Kerui's panels are warmly welcomed by customers is also related to this dead pixel rate indicator.Who wouldn't like products with low prices and good quality?

The low yield rate of full color is also related to Cheng Yongxing's higher requirement for dead pixel rate.

A screen of this size allows 5 dead pixels?Not kidding!

"How is this possible? Where did their panels come from?"

There are just a few TFT players. Who doesn't know who?Due to the homology of Japanese manufacturers, the production technology and even the production equipment used by everyone are similar.

"Their panel comes from China."

The information is stranger than one.One is more incredible than the other.

"China? Is there any advanced technology found in China?"

Although China has been open for a while, the impression it left on the outside world is still rather mysterious.This year China has launched several rockets in a row.Japan is very envious of this.

"Hurry up and call to check! Where are these TFT-LCDs produced? Where do their raw materials come from? Where do the glass substrates and liquid crystal materials come from? Who is providing them with the technology? Where did the equipment come from? These must be checked."

The entire LCD industry chain is now in the hands of Japanese manufacturers. If it is really necessary, some off-board tricks have to be used.

The meeting can't go on until here.

A mysterious player appeared on the market, and everyone was frantically searching for relevant news.

In Japan, the government and the private sector spent billions of dollars to cultivate the golden rice bowl, but someone came in to grab food?

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"The information is clear. The manufacturer that provides panels to xBM is called Kerui. It turned out to be LED. Behind them is a Chinese company located in Bingcheng.

They also started as LEDs before.

Their glass substrates are provided by a major military factory.

The LCD is..."

After nearly a week of investigation, some information that is easier to find has been fed back one after another.

In this era, China has basically no concept of confidentiality of business information.A lot of information can be found as long as a foreigner comes over with a phone call.

Cloisonne’s leaked story refers to this stage.In the eyes of the Chinese people at this time, foreigners' technology is advanced technology, not their own.When people come to understand, they definitely want to help us!

"This.."

The people in the whole house are in trouble.Some military companies have stepped in!

In addition, the direct supplier of the panel is a US company, and it is a bit risky to forcibly cut off the other's supply chain.Not to mention, the core raw materials are not in the hands of Japanese manufacturers.

"What is their yield rate? Have they found a way to break through the yield rate?"

"Their output is said to be very low, and the monthly output is only more than 2,000 pieces."

"Such a low yield!"

According to this ratio, their yield rate is actually only 7%!With this calculation, everyone is relieved.The yield rate of NDI has exceeded 15% and will soon reach 20%.

"However, if they do this, isn't this a loss-making business!"

A group of people smacked their tongues.With such a low yield rate, also came out to grab the market?Why are the prices of DTI products so high?It's not because of the low yield rate.

"Is it because their labor costs are very low?"

"It's related, but it shouldn't be the main reason. I think they can get cheap raw materials."

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For TFT-LCD, the yield rate can be tested only after all processing is completed.In this case, all raw materials have been wasted.

In addition, another big part of the cost of LCD is the depreciation expense of production line equipment.A too low yield rate leads to an ridiculously high depreciation and amortization on each finished product.

In fact, Japanese LCD manufacturers really don't make much money.When the price of the LCD panel is 2500 US dollars, their cost is also 2500 US dollars!

As the yield rate increases, the cost of NDI has dropped to about $1,500.A panel with a cost of $1,500, sold for $2,000. Is this profit margin high?

This is not high at all!

"Can we import raw materials from Chinese manufacturers to reduce costs?"

"You can try it. But how do you transport something like glass?"

"We can't use their glass."

"why?"

"According to xBM's quality engineers, their LCD screens are somewhat different from our products in terms of brightness and other parameters. It is estimated that the quality of the glass substrate is not good."

"No matter if you fail to pass the test, send someone to contact us, at least we have to know it well."

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"Where did they get their equipment?"

The meeting soon moved on to another topic.It stands to reason that China faces an international embargo.Especially in semiconductor-related equipment, it is absolutely impossible for them to get the latest equipment.

When did China get the first generation of LCD devices? It was 1998!

"We have also checked these. Their equipment is produced by ourselves. Our personnel have obtained some equipment parameters and photos from equipment manufacturers. But from the perspective of technical indicators, they are not prepared for mass production at all. Yes. How do you say these devices? They look like laboratory equipment."

Everyone is afraid of China's ability to be self-reliant.Whenever China's semiconductor equipment industry picks up, the embargo will be relaxed.

After 2000, there was a big development opportunity for semiconductor equipment, but that opportunity was quickly interrupted by the relaxation of the embargo.

China's semiconductor equipment industry is suffering from the cycle of embargo for several years and relaxation for several years.

"They are preparing to use manual methods to produce displays?"

"Hi! It looks like it is."

"Forget it, don't worry about this. Let's study how to improve the yield rate."

This is a strange player. Maybe it can be produced just like the Chinese rocket, but the output is too small to be afraid.In the era of commodity economy, it is not one or two high-end products that can be successfully processed by hand.

Koreans, at this time, were able to produce TFT-LCD, but what was the result?There is no threat to the Japanese at all.

Due to the incomplete intelligence collection this time, the Japanese manufacturers did not pay much attention to "Full Color Technology".When they reacted again, it was too late.