Apple is expected to get rid of LCD displays for its 2020 line of iPhones, offering completely organic light-emitting diode (OLED) displays.
The Wall Street Journal, citing people familiar with the production plans, reported that Apple prefers OLED displays because of their flexible handset design. The report came out of a broader WSJ story looking at the impact of lackluster iPhone demand on the supply chain. The report stated that Japan Display Inc. is in late-stage talks with TPK Holdings of Taiwan and the Chinese-owned Silk Road Fund about investments that would include taking a 30 percent stake in the company, with the option to get more control later on.
People familiar with the matter told The WSJ that disappointing sales of the iPhone XR prompted Japan Display to seek the bailout from the investors. The paper noted that more than half of its revenue in 2018 was derived from Apple. Of the new Apple iPhones, only the XR uses liquid crystal displays, which is Japan Display's specialty.
When Apple rolled out the iPhone XR in the fall, it had expected it to be a blockbuster hit, given that it was the cheapest of all three iPhones launched. The idea behind the XR was to provide users with the same experience as the iPhone X, but with an LCD device. But the XR failed to take off with consumers, resulting in Apple cutting production by as much as a third. In an effort to stimulate demand in November, the company cut the price of the XR in Japan, but to no avail.
Meanwhile, the XR hasn't done well in China, where consumers are not keen to pay a lot for the smartphone, even at 25 percent cheaper than the other two new iPhone models. In China, local manufacturers include all the bells and whistles in the XR, such as face recognition and dual SIM support, but at a cheaper price.