UPDATE 1-Canon to mothball project to develop SED TVs-Nikkei

May 25 (Reuters) - Canon Inc 7751.T said it has decided to freeze plans to develop flat panel televisions based on the SED (surface-conduction electron-emitter display) technology because of difficulty in bringing down production costs, the Nikkei business daily reported.

The SED’s design, which cuts power consumption and sharpens image quality, is an alternative to LCD and plasma sets, the paper said.

But developing a low-cost production technology has been a major hurdle for commercialization, the daily said.

The electronics products maker began developing SED technology jointly with Toshiba Corp 6502.T in 1999, the Nikkei said.

The firms established a 50-50 SED development and production joint venture in 2004 and announced plans to break into the flat-panel TV market, Nikkei said.

But their effort has been delayed repeatedly as the development of mass production technology has proved more difficult than expected, and the partners had to deal with a patent lawsuit by a U.S. company, the daily said.

Canon has turned the SED joint venture into a wholly owned unit and has been working toward commercialization, the Nikkei said.

Although it has put consumer SED TVs on the back burner, it aims to continue developing commercial SED products, such as image diagnostic equipment, the business daily said. (Reporting by Divya Sharma in Bangalore; Editing by Prem Udayabhanu)