Forming Industrial Cluster Lights Way for Taiwan's CCFL Makers to Diversify

In early May this year, the Small and Medium Enterprise Administration (SMEA) of the Ministry of Economic Affairs (MOEA) in Taiwan set up seven industrial clusters, including one for cold cathode fluorescent lamp (CCFL) makers, that the SMEA aims to grow into more well-rounded industrial segments generating steady revenue.

The CCFL cluster of manufacturers target tapping the lighting market instead of LCD (liquid crystal display) backlight markets, on which they have long depended for bread and butter.

Taiwan's position as the world's leading CCFL supplier base is becoming a burden rather than asset since the outbreak of the current, worst-since-1980s recession, which has idled 60% of the island's CCFL industry, a record rate, and hence badly hurting the world market of LCD TVs.

Although the recent rush orders mostly from mainland China's LCD-TV makers again kick starting the island's CCFL factories, the recession has set off the alarm to wake up Taiwanese manufacturers-reminding them not to put all their eggs in one basket-to be wary of generating revenues solely from LCD backlights.

Green Merits

Besides offering a new way to diversify business, CCFL lighting, tout Taiwanese manufacturers, features many eco-friendly merits including long lifespan, energy efficiency, minimal mercury content, and zero UV-B radiation. Also CCFL lamps do not give off UV-B rays, which are considered mildly harmful, though they emit a low level of UV-A rays.

LCD TVs in fact are usually assured of lifetime of at least five years, made possible because not the least of which are the very durable CCFL backlights, which normally last on average 80,000 hours and 100,000 on and off switches.

The CCFL's longevity is mostly due to its unique activation, which differs from that of hot cathode fluorescent lamps (HCFL), the most ubiquitous kind today. Unlike HCFL, CCFL is activated by high voltage. With HCFL filaments coated with a powder called "emitter," turning on a lamp passes electricity between electrodes to generate heat that burns a filament at high temperature, hence emitting electrons off the powder coating that interact with argon and mercury gas molecules to produce ultraviolet light. The coating is eroded minutely each time a lamp is turned on. Not so in a CCFL: The electrons in such a lamp are emitted when a kilowatt "sputters" a lamp's nickel electrodes, without deteriorating the emitter coating.

CCFL lags some T5 lamps in luminous efficacy, but many Taiwanese CCFL makers are turning out lamps with 80 lumens-per-watt and plan to upgrade to 90-lumen-watt at the end of this year.

Pursuing Official Standards

Last year, leading manufacturers, including GIO Optoelectronics Corp., Team Shine Electronics Co., Ltd. and Wellypower Optronics Corp., formed an alliance to promote CCFL lighting and push for officially-set industrial standards for such lighting with the assistance of J.F. Huang, deputy director of the Image Design Division of Display Technology Center under the government-backed Industrial Technology Research Institute.

At a CCFL forum held early May in Taipei, the attendees urged the government to draw specifications for CCFL lighting as part of the official Chinese National Standard (CNS) that manufacturers can follow to bid for government lighting contracts. In addition, Taiwan can set the pace for such standards, especially when neither CCFL leaders in Japan and South Korea nor lighting giants like Philips and Osram are interested in venturing into the CCFL-lighting market.

"A common specification interface, or standard, is needed to have CCFL lamps cross over from backlighting into lighting if such process is to be viable," emphasizes Huang, noting that many specification inconsistencies exist among backlight makers. For instance, lamp diameters are not standardized among makers, as are electrical specifications. "If they insist on individual specifications, then lamps can not be interchanged among makers' lighting fixtures, depriving users of competitive choices."

Branding is Preferable

Huang notes that growing sensitivity toward eco-friendliness and the economic recession are blessing in disguise: offering CCFL makers in Taiwan a chance to turn backlighting into general lighting. "But Taiwan makers stand a better chance in global markets by trying to build brands rather than being contract manufacturers," he stresses.

Eric Tai, director of Planning and Marketing Division of ITRI's southern Taiwan branch and deputy director of MOEA's Southern Taiwan Innovation & Research Park, is the executive of the MOEA's seven industrial-cluster program. He says the CCFL sector has been chosen this time as part of the program for its great potential in lighting. "Realizing such potential depends on pioneering industrial standards and tapping the considerable capacity of Taiwan's CCFL industry, which is capable of making key components and lamps," Tai says. "Setting standards ahead of others inevitably makes yours the reference for the industry," he adds.

Tai suggests that Taiwan's CCFL makers need to differentiate lamps from traditional fluorescent lamps, a way to succeed by achieving higher margins. "Manufacturers can highlight eco-friendliness and design characteristics as they try to differentiate their lamps. I think the SMEs in Taiwan are skilled at carving out market niches," he says.

Standards in the Works

C.W. Wu, deputy director of MOEA's Bureau of Standards, Metrology and Inspection (BSMI), says that in January this year the bureau met its members to discuss setting up CCFL standards after a December 2008 meeting with manufacturers. In April this year, the Taiwan Lighting Fixture Export Association (TLFEA), he adds, on behalf of CCFL manufacturers, recommended in a proposal that the BSMI should set up standards for CCFL lamps and ballasts. "Once the recommendation is approved, the bureau will start setting up the standards as soon as possible to help CCFL manufacturers tap the lighting market," he stresses.

Carbon Label

G.W. Jien, a division leader at the Department of Supervision, Evaluation and Dispute Resolution of the Environment Protection Administration, suggests Taiwan's CCFL manufacturers would do well to highlight the low CO2 emission of such lamps, a superior feature relative to conventional counterparts. "I think maybe they should develop a carbon label similar to the British Carbon Footprint. No lamp maker anywhere has so far done so for their products, so maybe Taiwan CCFL makers can set the pace, and the EPA is glad to lend a hand," he says.

In addition, Jien suggests manufacturers should emphasize the longevity of CCFL lamps as part of the carbon label.

TLFEA chairman J.L. Wu points out that manufacturers must reach a consensus before setting up standards.

Official Help

Julian Yieh, chairman of the CCFL alliance and director for business development at Team Shine Electronics Co., Ltd., urges the government to finish the standards before South Korean and Japanese CCFL manufacturers launch lighting products "or it will be too late." "Government help is always significant, no matter the size, to businesses. For instance, the South Korean government played a part to build Samsung into a world player," he adds.

Yieh hopes the government can finish the standards by the third quarter this year. "It's only for lamps and ballasts anyway. Besides, manufacturers have reached consensus over the draft of the standards. The schedule could be further shortened although discussions are expected," he says.

Louis Lu, assistant vice president of Wellypower and Taiwan's No.1 supplier of CCFLs, points out that, besides the economic meltdown, improved luminous efficacy is another factor for the oversupply of the lamps last year. "You do not need as many backlights with a brighter lamp, so producing the same volume regardless creates supply excess," he says, noting CCFLs are now 70-80 lumens-per- watt compared to 40-50 earlier.

Supply gluts, Lu notes, force manufacturers to look for other applications beyond backlights. "We're optimistic about CCFL spiral lamps relative to conventional energy-saving lamps because they simply fit existing sockets," he notes.

Temporary Standards

Eddie Kuo, GIO Optoelectronics' operations assistant vice-president, suggests the government draw up temporary standards for the CCFL industry if ratifying official ones is time consuming. "All CCFL lamps, except spiral compact lamps, are already safety regulated, but based on lighting fixtures, which makes CCFL makers' safety verification complicated and expensive. Typical fluorescent lamp makers simply apply for certification for lamp tubes and ballasts, which can then be installed on different lighting fixtures. But CCFL makers have to be certified for each fixture. So a temporary measure is vital to make business viable," he says.

Matrin Yieh, general manager of TOA Optronics Corp., urges the government to realize CNS standards for CCFLs as soon as possible. "The standards will not only help domestic sales but also CCFL exports, because it's hard to persuade foreign customers to accept non-officially certified lighting," he says.

Off-the-shelf Lighting

Yieh believes CCFLs have an edge on LEDs (light emitting diodes) in thermal and price issues, which keep LEDs from being popular. "CCFL is a ready lighting technology since it has been commercialized for over a decade as backlight," he says.

Gsharp Corp. vice president C.T. Wei has joined drafting the CNS standards for the CCFL industry. "We seem to be revising fluorescent lamp standards rather than creating dedicated standards for CCFLs," he says.

Sintronic Technology Inc. president Jeff Lin says that CCFL lighting applications have been maturing over the past two years in terms of luminous efficacy and lifespan. "Besides, tubes can now be bent into various shapes to meet different demands. So, it's about time to promote CCFL lighting. But government support is critical; for instance, the Taiwan government successfully built the island into the world's No.1 supplier of TFT-LCD panels, enabling domestic CCFL-backlight makers to exceed world-leading Japan," he notes. (June 2009)