Ennostar Group: The Company Behind Apple's 10,000 MINI-LED Display
Author’s note: You can watch the video below
Ennostar Group is another Taiwanese company struggling to deal with encroaching challenges from Mainland Chinese companies. Ennostar lacks scale in certain markets and as a result, they struggle to get to price levels competitive. Furthermore, R&D is extremely expensive and that sits as another millstone around their necks.
I am planning for another video on Micro-LED and its particular challenges and benefits. But to me the jury is still out whether Micro-LED is a revolutionary enough technology to bring Ennostar solidly ahead of the pack - not with OLED advancing as fast as it is. We shall see
As always I want to pitch the Patreon today. I am working on a new video follow up to my Indian Semiconductor Failure video, and I think it will be quite interesting. Early Access Patrons can see it when it is released. So sign up today.
In this video, I want to talk about Apple's latest technology plaything: the mini-LED panel in the 2021 model of the 12.9 inch iPad Pro.
The reviews on the iPad have invariably noted how nice the display looks. And it appears that the technology is mooted to show up in some of Apple's other products as is their tendency.
Tech publications like Linus Tech Tips and the Verge have talked about what makes mini-LEDs special. Definitely check those out too. But in this video, I want to take a look at the company supplying this interesting technology. One of the world's biggest LED vendors, Hsinchu-based Ennostar Group.
LED-backlit LCDs use LED backlights to shine light through the LCD (formal name TFT-LCD), which carries the image. Mini-LEDs are a refinement on this concept.
In a mini-LED screen, thousands of small "mini-LED" backlights are arranged and synchronized into dimming zones. Sophisticated control circuitry is created to control all of the backlights uniformly and efficiently. So they can light up or darken depending on the image characteristics.
For this reason, these panels can offer amazing contrast ratios, better refresh rates, and more.
Manufacturing-wise, they can be made in the same fabs as traditional backlit LCDs but with some incremental improvements. But at the same time, because of the sheer number of LED backlights, more wafers and dies have to be made for each new iPad.
Thus, this new technology can get quite pricey. Teardowns of the new iPad Pro find that the LCD backlight by itself is one of the tablet's most expensive components. Estimated to cost $90 per iPad, it takes up nearly 20% of the iPad's entire component cost.
It is expensive, but the results are stunning. So let us take a look at the company that developed and supplied it, Ennostar.
Ennostar Group is an interesting company in that it only has only recently started upon the market. It came into existence as it is today in January 2021. Prior to that, it had been two companies: Epistar and Lextar.
Founded in November 1996, Epistar is one of Taiwan's biggest LED suppliers. They are classified as an upstream and midstream provider, meaning that they develop the crystal, wafer, and die (upstream). They then also package it into modules (midstream).
Its founders had worked at ITRI, the Taiwanese public-private partnership that famously spun off TSMC many years earlier. ITRI had developed a new technology called transparent indium tin oxide or ITO. At this period of time, thin metal was used as a substrate for creating LEDs. This way of doing things however hindered how bright LEDs can be. ITO offered a better approach.
ITRI spun off Epistar to refine this technology and bring it to the market. The company did not turn a profit for the first six years of its existence, but it soon developed red LEDs that were substantially brighter than what was available.
From there, the company gained formidable strength in the LED industry. Epistar held over 4,400 LED patents, including many of the patents surrounding core upstream aspects of the mini-LED technology.
Lextar is another vertically integrated firm, making everything from the wafer to the final LED module. They were established in 2008 as a subsidiary of AU Optronics, one of Taiwan's biggest display makers.
Their product specialities are in displays and automotive applications. For instance, the lamps that go into car headlamps and what not.
Lextar has been developing their own mini-LED technology, demonstrating a 2.9 inch mini-LED panel in 2019 with over 2,300 dimming zones. The panel can reach up to 30,000 nits.
Epistar and Lextar realized that they were facing substantial technological and sales pressure from competitors in China and abroad.
Epistar 2019 revenues declined 27% from 2018. They made $15 billion NTD in revenue, about $575 million USD. Losses were $140 million USD.
Lextar generated revenues $9 billion NTD in 2019, about $323 million USD, but posted a $310 million NTD loss or $10 million USD.
2019 was immensely difficult for the LED industry, but they did not see relief coming in 2020. Thus, they resolved to consolidate their strengths and patent portfolio.
Once part of Ennostar, Lextar will focus on the downstream operations of LED manufacture. This means putting together the various LED components into finished mini-LED and micro-LED modules. Epistar would handle the up and middle-stream.
The two companies had both been vertically integrated, so this merger would allow them to focus their dual mini-LED and micro-LED development efforts.
It would also bring some of Lextar's critical customers like AUO and Cree Inc to Epistar's upstream business. They might be able to begin supplying panels to Samsung Electronics, as AU Optronics has been a Samsung supplier for a while now.
The announcement was made in August 2020, but not consummated until January 2021 due to regulatory review. Epistar and Lextar's stocks stopped trading and were exchanged for shares of the new combined company Ennostar.
Apple's Other Display Suppliers
According to Bloomberg, General Interface Solution Holding Ltd. and Taiwan Surface Mounting Technology Corp. are some of the other key providers of the iPad Pro's display technology.
These are some obscure names. I consider myself pretty familiar with the Taiwanese electronics industry, and even I have never heard of these companies.
General Interface Solution Holding or GIS in Miaoli provides the touch technologies behind all sorts of touch screens. That includes the cover glass, the touch sensors, and the LCD display modules.
Taiwan Surface Mounting Technology in Taoyuan does liquid crystal display surface-mounting. This is a complicated process that solders electronics components directly onto a printed circuit board.
That actually sounds kind of interesting and I wonder how they apply it to LCD screens. But for a future video, we shall see.
Another interesting name that came up during the latest supplier checks is ATL, who provided the iPad Pro's battery. I did a video about their spinoff CATL, which provides EV batteries.
Conclusion: Apple's Plans with Mini-LED
For all the nice reviews about the iPad, I guess mini-LEDs aren't really making a huge wave just yet in the consumer technology space. I reckon that people are more stoked about micro-LEDs and are probably already looking ahead to when those can start appearing on people's shelves.
And that kind of makes sense. The commercialization of Micro-LEDs allows for brand new form factors and opens up new experiences in things like virtual reality. Imagine what new consumer products might come down the pike when that is ready!
But all of that is more than a few years away. And mini-LEDs aren't chopped liver. They deliver a beautiful image that rivals the very best that OLEDs can do. There is a rumor that says that the next mid-range iPad Airs are going to have OLED screens and that the next big MacBooks Pros will have mini-LED screens.
I think that positioning, mini-LED as the high-end and OLED as the middle-end, is real interesting and, assuming those rumors turn out to be, demonstrates the potential that mini-LEDs have for the future.
As for Ennostar. Today, the company holds 12% of global LED chip capacity, holding crucial scale in an increasingly competitive industry. Snagging Apple's business demonstrates their technology lead. For now, anyway. But there are still too much competition in the LED space. Companies in South Korea, Germany and China are expected to catch up as soon as 2022.
Ennostar has to continue innovating and investing in R&D, namely micro-LEDs, to keep Apple's business and push the display industry forward.