China-based BOE Technology Group is seeking to supply Apple with advanced OLED smartphone panels for future iPhones.
Chinese manufacturers of displays for digital devices are maturing after years of steady growth, said experts, as reports surface that Apple has already integrated local company BOE into its supply chain and could soon procure next-generation organic light-emitting diode (OLED) screens for its iPhones in the nation.
“Non-disclosure agreements prevent us from discussing particular products, but BOE has indeed been part of Apple’s list of suppliers since March. Our technology and production capacity are world-class, and we have been involved in OLED research since 2001,” a staff member in charge of public relations of BOE said in a statement sent to the Wall Street Journal on Monday.
At the moment, Apple relies exclusively on Samsung for the supply of OLED displays for the iPhone X.
BOE is currently the only Chinese display company that supplies Apple and is controlled by the Beijing city government. If Apple and BOE sign an agreement, the Cupertino company comes to better terms with the Chinese government, as the company wants to expand in China and benefit from the booming local market. It can then make OLED screens much cheaper, eventually increasing the profit margin and possibly making iPhones more affordable.
In an area long dominated by Japanese and South Korean companies, Chinese manufacturers have quickly entered the display manufacturing industry. At first, they made traditional liquid crystal displays (LCD), soon moving to more advanced OLED screens.
“At present rates, China will dominate the LCD market in a few years. Eventually, the same will happen in with OLED screens,” Sun Yanbiao, head of Shenzhen-based research company N1mobile, told the WSJ.
OLED screens are increasingly being adopted by smartphone manufacturers, and they are estimated to completely replace LCD screens in the coming years. Experts noted that the entry of Chinese manufacturers will drive down prices and accelerate the transformation of the OLED market.
“Samsung as of now has about 95 percent of the market for smartphone OLED screens, but Chinese companies such as BOE, Everdisplay and Visionox are all expanding production. The issue is now reliability, but if Apple gives its recognition to BOE, all other smartphone manufacturers such as Huawei and Xiaomi will soon follow suit, and the expanded supply will drive down screen prices,” said Sun.