Awarded by a division of the Taiwan Government for Innovation in Technology it demonstrates AUO's commitment to investment in R&D. The focus of the award covers several areas relating to the benefits gained during the introduction of their 26" LCD TV Receiver panel.

Technology:

1. The Panel is developed completely by AUO's technological team who has demonstrated the company's advanced design and manufacturing technology capabilities.
2. Large size top-down backlight co-designed with Tama Denki of Japan.
3. New Colour Filter design for LCD TV with high transmittance rate and high colour saturation (NTSC 75%, >EBU 100%).
4. Faster than 12ms Fast Response Time with AUO award winning innovative technology (Superior Technology Award in Component Technology).

Innovation:
AUO applied MVA cell process technology into large size LCD TV panel manufacturing to reduce process flow and improve product yield. Each AUO 5th generation fab mother glass can produce up to 6 pieces of 26” substrate for TV panels significantly increasing performance efficiencies and cost advantages.

Marketing:
Production process improvements in 5th generation fabs will significantly reduce panel cost and can instantly take market share. This 26” TV panel is viewed as the future of home entertainment.

Environmental:
AUO's Environmental Friendly Policy starts at the Concept stage through design and on the production ensuring it's products are manufactured in the most environmentally friendly way.

These benefits will also be felt in the whole range of AUO TV LCD products. After the company's successful launch of its 30" LCD TV panel in August 2003, and the subsequent launch of their 46" panel this broadens AUO's wide range of sizes in its collection of LCD TV's.

This 46" Wide LCD TV full colour display is overturning world standards for high brightness, high response time, and contrast ratio. It offers HDTV 1920x1080 super high resolution, Premium MVA wide-viewing-angle technology ( 85 degrees in all directions), high colour saturation (75% NTSC; EBU>100%), high brightness of greater than 600 CD/m2, high contrast ratio (800:1). Not withstanding its high standards, it also provides power saving qualities. In addition to the company's Research and Development Team's stronghold on ODF technology, it has implemented super high response time of less than 10 ms (gray to gray), allowing for excellent motion picture quality display. The process improvements with AUOs 5th Generation Fabs enable two 46" panels from each motherglass. AUO has recently and successfully applied LED backlight module over 46" TV panels, which was displayed during FPD International at Yokohama Japan last year. This is also the world's largest TV panel ever applied with LED backlight module.

AU Optronics President, Mr. HB Chen stated, " We have reached a great threshold with the successful launch of our 46" LCD panel. Firstly, it goes to prove Taiwan's strength and capability in the development of large size LCD TV panels, unbeaten by Koreans. Secondly, with the addition of the 46" LCD TV panels, it completes the already wide-range of sizes we offered to customers; starting with our 14", 15", 17" , 20", to 26", and 30". From the digital consumer electronics with small sized panels to the living-room and industrial applications of large-sized panels, AU Optronics has the ability to fulfil the variety of customer's needs. AUO's G6 fab is aggressively being built as planned, and AUO's launch of 32" W and 37" W LCD TV panels this year is in response to the future demand for LCD TVs.

Dr. Hui Hsiung, Executive Vice President of Sales and Marketing reiterated, " As a pure-play in flat panel manufacturing, AUO has managed to produce 26", 30", and 46. Our LCD TV-receiver panels break the world records in both high brightness and contrast ratio. This shows how much TFT-LCD technology in Taiwan has advanced, surpassing Japan and South Korea." We are dedicated to making excellent LCD Panels and worked closely with our customers, as they are our partners in business for success."

Displaze Ltd., AUOs official Representative for the UK, has announced open order book for production 46" HDTV LCD TV Panels with delivery starting in now.

New display technology research in AUO R&D departments is based on technologies such as low-temperature polysilicon (LTPS), OLED and PDP. Although AUO is not widely know for it's PDP technology it has produced various sizes of PDP up to 50"

Further enhancements in brightness are being planned. In the past, LCDs left something to be desired in terms of brightness, response speed and viewing angle but LCD makers focus on these and other areas to upgrade their products.

In terms of brightness, Taiwan's manufacturers have caught up with its foreign competitors. CMO has achieved brightness of 500cd/m², while AUO's 46-inch LCD HDTV receiver module features brightness of 600cd/m² and response time <12ms (gray to gray). Apart from LED, AUO is also actively involved in the development of other light source technologies, such as EEFL (External Electrode Fluorescent Lamp). Comparing the EEFL light source with the conventional CCFL module; it is easier to assemble and with a simpler inverter design, which reduces cost and thereby serves as one of the many options among the light source technologies. AUO will also be displaying a 32" EEFL backlight TV panel successfully developed by it at the FPD International 2004.

Manufacturers including AUO and CMO have also widened their viewing angles, introducing the patented Multi-domain Vertical Alignment (MVA) technology into their LCD panels, which enables horizontal and vertical viewing angles up to 170°. AUO also plans to introduce its latest Image Tracking Backlight (ITB) technology, which is expected to substantially improve the quality of the images.

Many technical challenges still exist to bring large panel LCD pricing closer to that of Plasma. Some areas for possible improvement are listed below:-

1. Adopting a narrower cell gap, facilitated by column spacers.
2. Adopting less viscous LC material.
3. Increasing fluorine compounds.
4. Improving the elasticity coefficient
5. Optimising the alignment layer to minimize the DC component

Process flow improvement will also enable cost reductions as technology matures. Some of the areas where cost savings may be made are:-

1. 5 to 4 masks. 3 masks?
2. ODF - One Drop Fill - The main difference with the conventional technology (vacuum filling) is that seal and liquid crystal are dispensed on the lower glass first and it is assembled with upper glass in the vacuum chamber with precise alignment. After assembly, the sealant is cured by exposure to UV energy.
3. Higher equipment utilization and reduced cycle time
4. Flow shop, single substrate conveyor
5. Less sophisticated processes
6. Wet over dry?
7. Printing over lithography?

Some of these improvements will only come with further R&D investment but the level of capital expenditure on new process and production facilities will ensure the benefits will follow. Optimistic market projections lie behind manufacturers' efforts to ramp up their capacities for large flat panel displays for high-end TV applications. Sales of LCD TV receivers are forecast to double next year, and so is production -- from about 4 million units this year, to 8 million to 10 million units next year. AUO shipped 1.11 million large size LCD panels, including LCD TV receiver panels, last September alone. The second phase of its new 5th generation fab will begin production by the second quarter of this year. The company is building a 6th generation fab to produce next-generation panels. It is set to install equipment for its TFT-LCD production line by the end of the year with mass production of LCD TV-receiver panels on 6th generation motherglass targeted for the second quarter of 2005.

Recent shortages of 15" and 17" panels stem from a limited source of colour filter material. Industry sources predicted last year the global supply of colour filters for 5th generation panels will fall short of demand, hardly surprising with at least 10 5th generation panel production lines in operation in Taiwan alone. To secure a stable supply of colour filters -- a key component of TFT-LCD panels - AUO has just completed its own colour-filter plant, which is scheduled to begin mass production imminently. The company plans to invest $5.8 billion in colour filter production lines in the next few years. Other manufactures are reliant on third party suppliers of colour filters and may suffer further supply interruptions