According to a report by BusinessKorea, component manufacturers like LG and Samsung are feeling threatened by Apple’s growing self-sufficiency rate of their components used in iPhones. Leading parts manufacturers are currently enjoying increased demands from Apple for semiconductors, displays and camera modules for the upcoming ‘iPhone 8’. However, industry watchers believe this may change from next year.
Apple is expected to begin mass production of micro-LED displays in Taiwan by the end of this year and use them on its next generation ‘Apple Watch 3’. Once Apple starts using these micro-LED displays, LG Display, which has exclusively supplied OLEDs for Apple’s smartwatches, will be hit hard.
South Korean industry sources predict that domestic sales of OLED panels will decrease by more than US $201.35 million once Apple starts using its own panels on Apple Watches.
However, the problem becomes bigger when Apple decides to use micro-LED displays on its smartphones as well. Apple will use an OLED panel on the iPhone 8 to be launched in the second half of this year after testing the panel on the Apple Watch. Considering such precedent, Apple is highly likely to use a micro-LED display on its smartphones after testing the panel on the Apple Watch. In this case, not only Samsung Display, which supplies OLEDs to the iPhone 8, but also LG Display, which is a potential supplier, will be affected.
Samsung and SK Hynix’s supplies of DRAM and NAND flash memory chips to Apple are also under threat as the Cupertino company has joined hands with Foxconn and Sharp to acquire Toshiba’s memory business unit.