Scarcity Of OLED-Making Machines Could Impact iPhone 8 Production

iPhone 8 iPhone 9Photo by olleeriksson

Apple will apparently introduce at least one iPhone 8 model with a flexible OLED display in 2017, but there are reports that the U.S. firm is facing challenges in procuring this special display. To learn more about these challenges (if there are any), Bloomberg took a closer look at the Japanese company Canon Tokki, which manufactures machines that will probably be used to build the OLED displays for the iPhone.

Canon’s backlog could hurt Apple’s iPhone 8 dreams

Canon Tokki produces most of the machines that make OLED displays. Its ELVESS OLED machines stretch 328 feet in length and are used to deposit red, blue, and green pixels onto a glass surface using evaporating organic materials. Canon Tokki’s machines are known for lowering the margin of error and producing higher yields.

Canon Tokki has two years of backlog due to high demand for its machines, and it reportedly makes fewer than 10 of them per year. Apple is expected to use OLED displays manufactured by Samsung, which may already have these machines. So it is not clear how much impact Canon Tokki’s backlog will have on Apple’s production.

However, Bloomberg warns that Samsung, which itself uses the OLED displays for its phones, may not be able to produce enough to meet Apple’s demands due to low yield rates.

Bloomberg stated, “The potential production bottleneck is raising questions over Apple’s ability to feature OLED displays in next year’s iPhones, and whether the Cupertino, California-based company will be able to line up additional suppliers.”

The report also noted that the current wait time for the machine, which could be worth $85 million, is two years.

Suspense about the OLED display

Apple has been continuously adding new features such as pressure sensitive displays, a fingerprint sensor, custom-designed chips and so on to its iPhone. New features also put pressure on its suppliers, which push their capacity to create technologies that can drive sales of more than 200 million iPhones each year.

A couple of years ago, the iPhone maker wanted to use sapphire glass, but the manufacturer could not meet demand and went bankrupt. Now it appears OLED is the goal. Rumors suggest that Apple is set to release at least one iPhone model that will have an OLED display.

Rumors of the iPhone 8 having curved OLED displays like the Galaxy S7 Edge surface every now and then. On the other hand, some also believe that the iPhone 8 will have less dramatic curves and that there will be a flat OLED display without any bezel for an edge-to-edge design.

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About the Author

Aman Jain
Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at [email protected]

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