Hitachi, Sony and Toshiba are planning a joint¹ venture to make small and medium-sized LCD displays for tablet PCs and smartphones.

日立、索尼和东芝正计划为平板电脑和智能手机联合开发中小型液晶显示屏。

The partners say they expect the market for small and medium-sized LCDs to grow rapidly
The new company will be operated by Innovation Network Corporation of Japan (INCJ), a government-backed firm set up to promote innovation in Japan.

The companies hope to have integrated（整合） the businesses by early 2012.

INCJ will eventually hold 70% of the shares in the new company, with its three partners holding 10% each.

The companies have signed a memorandum² of understanding, which is not currently binding³. They hope to sign legally binding agreements later this year.

INCJ, which is 90% government-owned, will eventually invest 200bn yen⁴ ($2.6bn; £1.6bn) in the venture, which will overtake Sharp and Samsung to be the world's biggest manufacturer of small and medium LCD displays.

Hitachi, Sony and Toshiba have hesitated to make big investments in the LCD business because of competition for South Korea and Japan and expectations that prices are likely to fall.

"We will probably see oversupply⁵ in the near future," said Shigeo Sugawara from Sompo Japan Nippon Koa Asset Management.

"It's not a business that will likely provide stable profits in the mid⁶ to long term."

Sharp is about to receive a $1bn investment from Apple.

There are concerns that while Toshiba, Sony and Hitachi have 21.5% of the small and medium LCD display business between them, they use different types of display technology, which will make it difficult to combine the businesses.