$3 Billion Opportunity for Back-end Equipment and Materials Suppliers: HB-LED Packaging
Si Substrates Improve Thermal Management
By Paula Doe, SEMI Emerging Markets
What emerging market offers a $1 billion opportunity for back-end equipment and materials suppliers in 2010? According to Yole Développement, the packaging of high-brightness (HB) LEDs is a big opportunity with forecasted growth of more than 25% annually. The HB-LED packaging market is expected to surpass $3 billion by 2015.
Most of spending goes for the specialty packaging materials that can handle the high heat and light outputs required. Materials for HB-LED packaging were an $850 million market in 2009, suggesting that these materials suppliers may end up with about 60% of the approximately $1.4 billion revenues from the sector. Though sector demand for backend dicing, interconnect and laser lift off equipment is currently relatively modest, it can expect accelerating growth, to average 34% annual expansion through 2015.
Source: Yole Développement, HB LED Packaging Report 2009
Yole defines HB LEDs more restrictively than some other market researchers as those of 30 lumen/ Watt or better, such as used in automotive and TV backlight applications, but which does not include those used in most other LCD backlights. The ultra high-brightness segment, those units of 100 lumen/package or more used in automotive headlights and general illumination, remains a modest approximately $280 million niche so far, but is poised for strong growth as costs continue to come down.
Package Substrates for Thermal Management are Key
With only 25% of the energy converted to light in a typical high-brightness LED, and the rest to heat, packaging technology for thermal management appears to offer the most headroom for improving the light output, and is the focus of many companies’ distinguishing competitive efforts. It may also be one of the best options to bring down costs. “We did a lot of reverse engineering of major products from the leading producers, and learned that the chip technology was all based on the same IP— but there was not a single similarity among the packages,” says Yole Développement analyst Philippe Roussel. “We came to conclude that more than 70% of the cost is in the package.” He also notes that the recent round of announcements of development chips with efficiencies pushing 150 lumen/Watt (lm/W) and more are enabled primarily by advances in the packaging technology.
One key solution to better thermal management is the package substrate, which accounts for about half the materials costs of the package. Molded resin substrates with heat slugs or metal core printed circuit boards are the most prevalent solution, but more suppliers are turning to ceramic substrates of alumina or AlN for their higher power devices, or to ceramic or silicon submounts between the chip and the package substrate.
VisEra Improves Thermal Resistance with Silicon
But the most intriguing potential is from new substrate materials. TSMC spinout VisEra has started production in commercial volumes of high-power (350mA) LEDs on silicon package substrates, using a wafer-level packaging flow on 8-inch wafers. “Thermal resistance is 3°/W or even lower,” says VP Peter Zung, VP of business development, who claims performance is 2–3 times better than ceramic, and results in a 10-15% increase in lumen output.
VisEra’s process does the packaging as a wafer-level flow to greatly simplify the handling of die, but is not doing wafer-level packaging on the original device wafer— it starts with already singulated die from LED makers. It patterns the wafer with through-silicon vias, then does metallization and adds a dielectric for protection. The LED die are then placed on the wafer by pick and place and wire bonded. The chip areas are conformally coated with phosphor with a mask and liftoff process, then lenses are formed across the wafer, and the wafer then finally diced. Key was getting control of co-planarity of the lead frame matrix. The company also had to develop a custom tool for the lens tooling. Though wafer-level processes certainly have potential to bring down assembly costs in high volume, currently the company is focusing on applications that need the better reliability from its better thermal performance and is not the cost leader.
It’s also bringing the foundry model to the heavily custom LED packaging world. The silicon design can be customized for different matrix patterns of LEDs, as can the layout and the lenses, allowing considerable variation in the wafers running through the same foundry process. Zung says the company is running wafers for both side and top view devices, for both general illumination and backlights, and for a wide range of other applications as well. Some customers are using the same package footprint as major merchant suppliers to be a drop in replacement, while others design to differentiate and optimize the package. Customers include both LED makers outsourcing packaging, and downstream light engine and luminaire makers designing their own systems. Zung says that since starting in earnest in August, the company now has backlog through 2010.
VisEra was founded in 2003 by TSMC and image sensor and strategic technology partners as an image sensor foundry, and built a business doing back-end on-chip color filters, microlenses and wafer-level modules. But revenues were declining in the past several years, so the internal development team developed the LED process, making use of the existing fab equipment.
Tong Hsing Brings Down Costs with Copper-plated Ceramic
Meanwhile Tong Hsing argues that its copper-plated ceramic material may significantly bring down the cost of high-performance LED package substrates. SVP of marketing and technology Heinz Ru argues that the Taiwan company’s copper-plated ceramic LED substrate can bring package substrate costs down to 5-10% of the $0.60 total cost of a high-power 1W, 100 lm cold white LED chip. It uses a proprietary bonding layer to get a stronger bond, and fills the vias during the surface plating step, instead of requiring a separate process, for a lower cost production process, while the high-thermal conductivity of the copper gives better thermal performance. Production is done at high-throughput on an automated rack plating line, but is reportedly also easily customizable to different materials and thickness for metallization and ceramic for different designs. Thermal conductivity of copper is around 390 Watts/Kelvin meter (W/mK), the AlN substrate170W/mK (or Al2O3 _30W/mK), compared to silicon at about 150W/mK.
Tong Hsing has been developing smaller ceramic packages for major LED makers since 2003, and it expects that its LED substrate business will jump to about 50% of company revenues in 2010, up from about 33% from all thick and thin film ceramic substrates last year. It’s now also working on applying the same technology to packaging triple-junction PV cells and control modules for hybrid vehicles.
The company originally saw fast growth from supplying ceramic packages for power amp modules for cell phones, but sales plummeted when that market all switched over to overmold packaging, so the company turned to a diverse range of specialty packaging for MEMS, military and medical markets that it could make on its existing equipment. “We go after startup companies that need help,” says Ru. “We’re betting that maybe 10% of these startup opportunities will take off, but if they don’t, at least they have good technology and pay for development, and the entrepreneurs who started them will come back to us the next time they start a company.”
The sector is interested in other material developments as well. There’s progress in development of encapsulation or coating materials with higher refractive index, closer to the 1.77 of sapphire, to aid in light extraction. “We expect new material formulations to be introduced over the next year,” predicts Jan Vardaman, president of TechSearch International.
She also notes that users need boards with better reflectivity so that less light is absorbed. For example, solder masks that are close to 0% absorption in key wavelengths are of interest to many companies. User demand could also start to push the sector towards a standard package footprint, which would ease integration and cut costs for designer of the systems that use the HB LEDs.
On the equipment side, nominally conventional interconnect tools are and will remain the largest backend equipment market for LEDs. But the sector also has growing need for laser dicing and laser liftoff tools.
To get smooth sidewalls for light extraction and prevent cracks or chips in the brittle substrates, LED makers are increasingly turning to laser dicing instead of scribing or sawing to singulate their die. But there’s plenty of competition for this emerging business, with at least seven companies going after what’s currently still a small market. A number of LED makers also remove the sapphire wafer substrate to get better light extraction and/or better connection to the thermal package substrate with a laser liftoff process.
Pressure to bring down LED packaging costs is likely to intensify. Nikkei Microdevices also argues that the ramp up of volume production for consumer display markets will likely change the HB LED game further by introducing consumer cycles of under and over supply. It points to the big ramp up in LED production at the LCD suppliers for their internal use, with Samsung ramping from 700-800 M units a month to approximately 2 billion units per month, putting it in the league with major LED makers like Nichia and EpiStar. LG Group and AUO Group are upping their production from 200-300 million units per month to 600-800 million units per month to become middle-sized suppliers. Nichia plans to ramp its capacity by 50% per year for the next three years, reports the Japanese trade journal.
The television and display makers are ramping internal capacity because their outside suppliers couldn’t meet their LED backlight needs now, but if PC and TV demand slips, a surplus of HB LEDs spilling over into other applications could push down prices there as well. Users also continue aggressive price roadmaps. Sharp has reportedly told its suppliers that it expects a 50% price drop this year, down to about $.01 (¥1)/lm. Japan’s LED makers have also accelerated their own cost roadmap, now targeting to $ 0.005 (¥0.5)/lm by 2011, and 200 lm/W. That would potentially bring LED light bulbs prices down accordingly to around $22 (¥2000), from about $45 (¥4000) now.
For more information on LEDs, please visit the SEMI Emerging Technology website at http://www.semi.org/en/IndustrySegments/EmergingMarkets/index.htm or visit http://extremeled.semineedle.com.
January 5, 2010