Sony Corp and Samsung Electronics have launched a joint venture for flat-panel televisions even as the South Korean company warned of possibly lower screen prices.

The 50-50 joint venture, S-LCD Corp., opened in Tangjeong, 100km south of Seoul, to produce large, seventh-generation liquid crystal display (LCD) panels.

Samsung officials said the joint venture has the world's largest plant for seventh-generation thin film transistor LCD (TFT-LCD) panels.

The two companies said the venture, capitalized at 2.1 trillion won (US$1.8 billion), would produce 60,000 panels a month by early next year.

Samsung and Sony have four seats each on the eight-member board of directors including Lee Jae-yong, the only son of Samsung Group chairman Lee Kun-hee.

Sony executive deputy president Ken Kutaragi said S-LCD's panels would be at the core of the company's flat panel TV strategy.

"There is a tremendous potential for expansion in the market for digital TVs and Sony will apply its unique signal processing technology, device technology and design skills to deliver products that allow customers around the world to enjoy varied content," Kutaragi said.

Samsung officials say the partnership will help the world's top chipmaker strengthen its position in the world's fast-growing flat panel market.

Major LCD makers have been increasing capacity to meet booming demand for flat-screen TVs and computer monitors as the traditional cathode-ray-tube screens are dropped.

Samsung said that sales prices for LCD panels are expected to fall about 10 percent in the second half due to oversupply, which will be resolved from September