Thursday, November 26, 2015

Confirmed: Apple to adopt LG’s OLED for iPhones.

Apple will adopt organic light-emitting diode (OLED) displays on iPhones starting in 2018, supplied by LG Display. As the number one smartphone vendor Apple has decided to use OLED, the global display panel industry is expected to change dramatically.

According to a report from Nikkei on Nov. 16, Apple has notified its suppliers about its future plans, with LG Display already planning capacity upgrades for high-volume OLED display production.

Apple will sell its new OLED iPhones three years later. OLED displays offer sharper images, brighter colors and better power efficiency compared to existing liquid crystal display (LCD). Also, flexible OLED displays allow a wide range of device design.

Samsung and LG commercialized OLEDs on their smartphones in 2010 for the first time in the world. However, Apple has stuck with advanced LCD after its release in 2007.

But initially Apple, which ships over 200 million iPhones a year, may opt for a mix of LCD and OLED until capacity can catch up. Apple is likely to use OLED only on some models of its new iPhone first.

As Apple has officially announced its plan to adopt Korean OLED, the global display market will face a transition in the future. With Samsung Electronics becoming the first to expand the investment in OLED, the company is currently the only company in the world that can reliably mass-produce OLED smartphone screens.

LG is expanding the market with OLED TVs. China’s display panel makers are also making active investment in new LCD display plants with government support.

Accordingly, the move will have a deleterious impact on Japanese display producers, which rely on LCD orders from Apple. It is realistically impossible for Japanese companies to catch up Korea’s OLED technology and its mass production system at once. 

Therefore, Sharp, which is currently seeking to rebuild its business after major restructuring, and Japan Display, which relies on Apple for 30% of its business, are expected to take a hit on their profits.

Related post: LG Display to invest $8.7 billion in new OLED plant, targeting iPhones 2018 models.

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