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Wednesday, August 16, 2017

LG to also supply Apple with OLED screens next year

Samsung may soon not be the only supplier of OLED displays for Apple as the Cupertino-based tech company has reportedly invested $2.70 billion in LG for the production of OLED panels It is believed that Apple will switch to OLED displays for all of its iPhone releases in 2019.investment is for the sole purpose of producing OLED panels and is just an advance payment.
"With the renewed partnership with LG, its long-time LCD partner, Apple has secured a secondary supplier for the crucial OLED panel, while the Korean partner can reduce risks from the huge initial spending on beefing up its OLED production," the report said.

LG supply OLED production with 45,000 units of the sixth-generation monthly.that`s equal to 32 million OLED iPhones a year with a yield of 60% to Apple in 2019. KGI's Ming-Chi Kuo believes that LG will to supply between 10 percent and 20 percent of the iPhone's OLED supply by 2019, and 20 percent to 30 percent by 2020.Apple and LG have reportedly come to a tentative agreement on the plan, with timing and specific investment amount not yet finalized.

LG Display has already said it would invest $6.5 billion in OLED production investment would be divided between large- and smaller-size OLED displays at its factory in Paju, near South Korea's border with North Korea , two-thirds of the investment, or $4.5 billion, will go into the production of smaller-size OLEDs, while the remainder will be invested in large-size OLEDs.

Since there are very few OLED makers capable of mass production, there is a higher risk of loss when there’s a mismatch between supply and actual panels purchased.Apple seeking to diversify iPhone OLED supply beyond Samsung with LG investment“We think Apple is therefore committed to having LGD geared up for its OLED iPhone display business in 2018 as it seeks to reduce supply risks,” Kuo says Samsung’s ability to supply large quantities and meet Apple’s quality standards made Apple-LG partnership the perfect choice for supplier of the iPhone 8 OLED display.
If there were still doubts that Apple would be embracing OLED over LCD moving forward, this new bit of information might dispel that. According to Korean media, Apple and LG Display, LG’s panel-making business, have just reached an agreement into how much OLED displays the latter will supply Apple, most likely for iPhones, next year. This spells some trouble for Samsung“This will in turn continuously boost Apple’s bargaining power on OLED prices,” Kuo noted.
Accelerating LG’s OLED display production hinges on whether Apple and LG Display can agree on an upfront amount of panels to be produced."Sources say LG Display is likely to build a production line dedicated to iPhone orders only," The Korea Herald report said,According Kuo, Apple is making big investment in LG to support its use for OLED screens for its coming iPhone 8

OLED displays have a series of advantages:

OLED screens are thinner & offers better color contrast & also offer better picture quality than the mainstay LCD screens because they don't need a back lit panel, and can be shaped more easily to create curves. In addition to that, they also usually make for devices with better battery life, as they don't waste energy by keeping black pixels turned off.

The only problem with them is that they are harder to manufacture, and as of right now, Samsung and LG's subsidiaries are essentially the only two companies with a big enough supply for products targeted at the consumer market.

smartphones use LCD displays, but premium smartphones are increasingly switching to OLED--including Apple Inc., which will use OLED screens for its coming iPhone 8. That shift has pushed LG Display to jump into the fray for smaller-size OLEDs.

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