U.S. Plans Aid to Help Computer Companies Compete With Japan : Technology: The proposal would provide millions of dollars to domestic suppliers of flat-panel display screens, with part of the package coming from the Pentagon. An announcement is scheduled for Thursday.
The Clinton Administration this week plans to unveil a multimillion-dollar aid program for U.S. makers of flat-panel display screens, an industry struggling against Japanese domination.
The screens are prominent features of laptop computers, but they are also being used increasingly in military equipment, and it is the Defense Department that is to announce Thursday the Administration’s initiative to bolster the U.S. industry.
A portion of the financial aid will come from the Defense Department, Pentagon spokesman Lt. P.J. Crowley said, but he declined to say how much money that might be or to comment on a New York Times report today that the Administration’s entire aid program could total $1 billion.
Crowley said the initiative will be outlined by Kenneth Flamm, a Pentagon special assistant for dual-use technologies--that is, technologies that can be used in both military and commercial industries.
A few American companies, such as Planar Systems in Oregon, build the thin computer screens, but together they account for less than 5% of the worldwide sales. Japanese makers have an iron grip on 95% of the world market, led by industry leader Sharp Corp., which alone sells more than $1 billion of flat-panel screens annually.
The White House and the Pentagon, displaying a willingness to bypass market forces on behalf of what they consider to be a strategic industry, had said in January that they were evaluating various measures that would help the U.S. companies compete.
Drawing a page from Japan’s own policy of aggressively using government to bolster certain industries, the Administration said it was considering a multiple-agency plan that might help loosen Japan’s stranglehold on the flat-screen market.
It won’t be the first time the Administration has tried to help the flat-screen makers. In June, 1993, the Commerce Department revoked a 63% import duty on certain display screens, a duty that had been criticized by U.S. companies as driving laptop computer manufacturing overseas.
The White House and the Pentagon also awarded more than $100 million to U.S. companies for additional flat-panel research and development.
The government is also helping a recently formed group that represents the industry, the U.S. Display Consortium, to develop a domestic network of component suppliers so that U.S. manufacturers are not dependent on Japanese parts.
Though associated largely with computers, flat-panel screens are expected to be used increasingly on a variety of products, including airplane and automobile instrument panels, video telephones, high-definition television sets and hand-held personal communication devices.
