Last month ETNews reported that that Apple chose Samsung Display as the company's primary OLED supplier for its next-gen iPhone, and the two companies signed an official contract - with Flexible OLED supply for Apple's next iPhone to begin in 2017.
Yesterday Yonhap News, another Korean news agency, confirmed the story, and added some new details. This is still not official of course (SDC declined to comment), but according to Yonhap Samsung Display agreed to supply 100 million 5.5" AMOLED panels to Apple per year, for about $2.6 billion - with shipment starting to 2017. Apple will maintain this contract for at least three years.
If this report is true, this is great news for the OLED industry. Samsung produced around 200-250 million AMOLEDs in 2015, and adding 100 million 5.5" ones will increase its capacity dramatically. According to earlier reports, all those displays will be flexible AMOLEDs.
The deal's sum seems a bit low, though - as it represents a cost of only $26 per display. IHS for example estimates that the 5.1" QHD Super AMOLED display used in the GS7 costs $55. Apple will undoubtedly require a top-of-the-line display, and at 5.5" even a glass-based display (let alone a flexible one) should cost more than $26.
Samsung recently decided to double the capacity of its A3 flexible OLED line - the company placed orders worth around $325 million to increase capacity from 15,000 monthly substrates to 30,000. Samsung hopes the new capacity will be ready by early 2017. So at least capacity-wise, Samsung may be ready to supply a large amount of displays to Apple.
ETNews' story said that SDC will produce between 50% to 80% of Apple's OLED displays. Apple is now choosing a second supplier, and ETNews said that other display makers are fighting to become Apple's second OLED supplier. There's a high chance that LG Display will be chosen, but the company has not yet been able to secure enough production capacity. Sharp/Foxconn and Japan Display are competing with LGD for Apple's OLED business, but Sharp will not be ready to produce OLEDs next year.
