Apple Closing a $12.8 Billion Deal with LG and Samsung for OLED Panels

We saw rumors earlier this month claiming that Apple will be switching from LCD to OLED displays for future iPhone models, starting from 2018. Things seem to be gaining pace now as a latest report suggests Apple is finalizing its deal with LG Display and Samsung.

Apple sourcing iPhone OLED panels from LG and Samsung:

Apple’s plans to switch from IPS LCD to OLED have been around for years now. According to ETNews, Apple is close to entering into an agreement with Samsung and LG as its suppliers for flexible OLED panels for the iPhones. The tech giant is reportedly spending over $12.8 billion in the combined deal.

LG and Samsung Display are close to a final agreement with Apple for the screens, the Electronic Times report said, adding the two Korean firms plan a combined 15 trillion won ($12.8 billion) in capital expenditure to build up OLED production capacity over the next two to three years. – Reuters.

Earlier rumors of Apple planning to use OLED screens for iPhones starting in 2018 seem to fit well with these latest claims as both these suppliers have to start ramping up their production capacities. LG is said to be switching its existing LCD lines to manufacture OLED panels to reduce investment costs, while negotiations with Samsung are still ongoing as Samsung is likely getting a bigger slice of this deal. Apple is also providing funds for some of the equipment that LG and Samsung Display will require to increase their production capacity.

While Apple’s iPhones feature top of the line hardware, including industry leading chips, it has a long way to go in terms of screen quality to please its user base. OLED displays aren’t only thinner, but are also said to be more power-efficient. However, users have long wished for these panels as they offer more vivid colors. For Apple’s side of the story, these panels can be expensive than the LCD screens and they are also said to be more prone to breakage.

One thing is certain that iPhone 7 expected in September 2016 is not going to feature an OLED display. Apple might be able to fit an OLED panel inside iPhones starting from 2017 or 2018 but it’s not expected to arrive in next year’s iPhone models.