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January 10, 2012

CES 2012:Sony shows futuristic Crystal LED's

LAS VEGAS—As competitors introduce plans to leapfrog the dominant technology for flat-panel television displays, Sony Corp. is proclaiming a different display breakthrough to help rescue the fortunes of its sagging TV business.

At the Consumer Electronics Show in Las Vegas, the Japanese electronics and entertainment group is showing off a prototype 55-inch "Crystal LED" television set, which Sony said is superior to the prevalent alternative known as liquid-crystal display. The company said the approach offers better image quality from a wider range of colors, while quickly responding to fast-moving images and consuming less power in a thinner frame.

Sony Chief Executive Howard Stringer says the technology is a revolutionary approach. "Your eyes will pop, your mouths will water, and you'll tell your friends: I have seen the future—and it's a Sony," he said at the trade show.

Sony worker sets up CES display

Mr. Stringer didn't offer a timetable for when the product might be commercialized, but company officials said Sony is working to get Crystal LEDs into the market in the next few years.

The key to Sony's new display is its use of light-emitting diodes, or LEDs, semiconductor chips that emit light when zapped with electricity. In recent years, television makers have used LEDs as a backlight to illuminate LCD television sets. The chips replaced fluorescent lights and enabled LCD television sets to be thinner than in the past. Sony has mounted six million microscopic LED lights directly onto the display itself, eliminating the need for a backlight.

There are two million red, green and blue chips. Those colors comprise the fundamental building blocks for displaying color images on a television screen.

Sony's announcement comes against the backdrop of an electronics industry struggling with the business of selling TVs. Consumers are buying more television sets than ever, but the manufacturers are grappling with razor-thin profit margins—a byproduct of the relentless price competition gripping the industry. It is often difficult for consumers to differentiate one TV from another, so companies are left to compete on price.

Sony knows all about the challenges of the TV business. Once a dominant competitor, the Tokyo-based company was late with LCD television sets in the early 2000s, and lags behind current industry leaders Samsung Electronics Co. and LG Electronics Inc., both of South Korea. Sony's TV operations have been in the red for most of the past decade. The company expects its TV business to incur a loss of about $2.3 billion in the fiscal year ending in March.

The task of turning around the television business has fallen to Kaz Hirai, a Sony videogame executive who is considered the heir apparent to Mr. Stringer. Since taking over the TV operations last April, Mr. Hirai has pushed Sony to take a more analytical approach to the business while scaling back shipments in order to limit losses. Last month, Sony announced plans to end an LCD-panel making joint venture with Samsung, so it can buy less-costly panels on the open market.

To inject new life into the TV market, manufacturers are looking at shifting to display technologies for thinner and lighter models. Sony's new display could set up a showdown with a rival technology called OLED, or organic light-emitting diode. Similar to Sony's new technology, OLED doesn't require a backlight and offers better picture quality and energy efficiency.

While OLED is already used in displays for smartphones and tablet computers, manufacturers have struggled to produce screens efficiently at larger sizes. Sony was the first company to sell an OLED television, an 11-inch model in 2007, but it has been unable to get costs down on larger sizes.

Sony's competitors have been talking up large OLED television sets at the Consumer Electronics Show. LG Electronics said it plans to release its 55-inch OLED television set around the middle of 2012, while Samsung on Monday unveiled a 55-inch "Super-OLED" that eliminates the need for a color filter, which can limit the color quality of images.

Tim Baxter, who heads Samsung's North American consumer-electronics operations, called its OLED television sets "a giant leap forward for the TV industry." He added that the company plans to sell the sets later this year.

Sony said Crystal LED offers more promise at larger sizes, because it is more stable than OLED, offering the potential to reduce the manufacturing errors that cause production costs to rise. The company said Crystal LED offers better picture quality in brighter environments and will be more durable than OLED, which can be susceptible to factors such as humidity.

For its part, Sony said it will continue to pursue development of both technologies. A person familiar with Sony management's thinking said there is still internal debate at the company about which technology holds more promise. This person added that Sony is considering a variety of options, including partnering with other companies on OLED screens for smaller television sets and using Crystal LEDs for its larger-size screens.

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