Apple has reportedly contracted with Chimei Innolux, Taiwan's largest LCD maker, for the next-generation panels, according to The China Times (via AppAdvice). Apple's interest has reportedly been prompted by alleged "interference problems" with the recently released iPhone 5.
The iPhone 5 marked the debut of new touchscreen technology in Apple's smartphone: in-cell touch panels, allowing for a thinner design by combining the touch sensor and display into one component. Rumors of Apple's adoption of in-cell panels swirled in the company's overseas supply chain for months, and proved to be true when the iPhone 5 debuted.
An issue with the iPhone 5 display in which the screen pauses or seemingly ignores touch input was publicized in November. The problem can be seen by rapidly swiping back and forth diagonally on the touchscreen of the iPhone 5, while previous iPhone models did not exhibit this behavior.
Initial reports suggested the iPhone 5 scrolling "glitch" was in fact a hardware issue related to the new iPhone 5 in-cell touch panel. Thursday's report from the Times supports that conclusion, explaining that the technology has embedded the TFT touch panel and touch sensors on the same side, resulting in interference.
Thursday's report also reiterated earlier reports that claimed production issues with the in-cell technology led to supply constraints of the iPhone 5 at launch.
The alternative "touch-on display" technology from Chimei Innolux is said to be both thin and durable, while offering better touch sensing capabilities.