Toshiba and Canon are investing $1.7bn (£936m) to build a factory that will make a new type of flat-panel TV based on SED (surface-conduction electron-emitter display) technology.

The investment cost of the factory will be split evenly between the two companies. Construction is scheduled to begin later this year, and the factory will start producing 15,000 50in panels per month in January 2007.

SED combines elements of CRT (cathode ray tube) and LCD (liquid crystal display) technologies and is being positioned by the companies to compete with plasma TVs.

SED TVs can produce pictures as bright as those of CRT TVs and without the slight time delay sometimes associated with LCD TVs, according to proponents of SED.

The technology uses as little as two-thirds the power that plasma panels use, according to Toshiba and Canon.

The first SED TVs should go on sale before the end of March 2006. Toshiba has yet to announce screen sizes and prices, but the devices are likely to sell at a premium above plasma TVs of the same size.