Apple probably has big plans for the iPhone 8, which is expected to be the name of the tenth anniversary edition of the iPhone, and the company has been rumored to be ready to make the switch to OLED displays. With this tech, which is already used by its major rivals, it hopes to attract a larger number of customers to its smartphone. However, supply for such displays is a big issue for the U.S. firm, according to Bloomberg.
OLED constraint to continue into 2018
For Apple, the problem is that the production capacity with its four main suppliers of such components is not sufficient for all the new iPhones next year. The constraints are expected to continue into 2018, says Bloomberg, citing people familiar with the matter.
Production of OLED screens is more difficult compared to LED screens. For this reason, Apple is at the mercy of suppliers that manufacture the displays in mass quantities, notes Bloomberg. Samsung Display, Japan Display, LG Display Co. and Sharp Corp. are the four largest producers of OLED screens.
Dan Panzica, a supply chain analyst at IHS Markit, said, “Apple has already figured in there will be high demand for the OLED model and they’ve also figured out there will be constraints to these panels.”
Supply constraints are expected due to the combined effect of Apple’s stringent quality requirements and the difficulty of producing OLED panels, the analyst says.
What options does Apple have?
An analyst at Creative Strategies, Ben Bajarin, notes that display technology still plays an important role in consumers’ smartphone buying decision. Apple used new display features as iPhone selling points in the past as well. For instance, in 2010, the company introduced its Retina Display with the iPhone 4, and in 2012, it introduced its first display size increase with the iPhone 5.
“There is all this talk about OLEDs, but I’m not at all sure about their future,” Sharp President Tai Jeng Wu told reporters recently. “We need to work on developing the technology, but whether we can succeed remains to be seen.”
Samsung is working hard to become the sole supplier for the new displays next year. It is possible that the South Korean company will not be able to make enough displays owing to low yield rates and rising demand for the iPhone. Thus, Apple might have no other option but to use OLED in just one version of the next-gen iPhone 8 or even push back adoption of the technology, says Bloomberg.