Apple inks 5-year, $500 million display deal with LG
Apple has entered into a strategic, long-term agreement with LG Display Co. for the supply of flat panel displays through the year 2013, according to regulatory filings made Monday with Securities and Exchange Commission.
The deal will see Apple prepay $500 million to the South Korea-based electronics manufacturer sometime this month in exchange for a guaranteed supply of LCD screens for Macs and/or handheld products over the next 5 years.
LG, which sits behind Samsung as the world's second-largest maker of flat panel displays, already supplies Apple with 70 percent of its LCD panels, HI Investment & Securities analyst Park Sang-hyun told Reuters. He expects prices for the parts, which have been falling rapidly during the recent global slowdown, to pick up in the near future.
The strategic agreement between Apple and LG is reminiscent of a similar deal forged between the iPhone maker and five memory suppliers back in 2005, which has afforded the Cupertino-based firm a competitive edge in the digital media player and cell phone markets.
Under the terms of that deal, Apple prepaid a total of $1.25 billion to Hynix, Intel, Micron, Samsung Electronics and Toshiba in order to secure an ample supply of NAND flash memory through 2010.
By padding its memory suppliers with funds up front, it's believed that Apple was also able to obtain more favorable pricing on the components, which has helped it apply margin pressure to rival media player and cell phone makers who've struggled to offer similar storage capacities in their competitively-priced offerings.
The deal will see Apple prepay $500 million to the South Korea-based electronics manufacturer sometime this month in exchange for a guaranteed supply of LCD screens for Macs and/or handheld products over the next 5 years.
LG, which sits behind Samsung as the world's second-largest maker of flat panel displays, already supplies Apple with 70 percent of its LCD panels, HI Investment & Securities analyst Park Sang-hyun told Reuters. He expects prices for the parts, which have been falling rapidly during the recent global slowdown, to pick up in the near future.
The strategic agreement between Apple and LG is reminiscent of a similar deal forged between the iPhone maker and five memory suppliers back in 2005, which has afforded the Cupertino-based firm a competitive edge in the digital media player and cell phone markets.
Under the terms of that deal, Apple prepaid a total of $1.25 billion to Hynix, Intel, Micron, Samsung Electronics and Toshiba in order to secure an ample supply of NAND flash memory through 2010.
By padding its memory suppliers with funds up front, it's believed that Apple was also able to obtain more favorable pricing on the components, which has helped it apply margin pressure to rival media player and cell phone makers who've struggled to offer similar storage capacities in their competitively-priced offerings.
Comments
Now maybe I can expect a new 23" LCD Cinema Display.
Going by the quality of their flat panel TVs, I think Samsung has the edge in quality over LG.
So I bought a Sony :-) which was stand out tops.
Does anyone know of a website where monitors are tested?
Now maybe I can expect a new 23" LCD Cinema Display.
Actually I'm hoping that this is a sign that more than the Cinema displays are coming. New iMac should be high on the list.
I'm also hoping that maybe this might be a hint at a Cinema display with a built in TV tuner. This could really add value to Apples expensive products and makes a lot of sense on larger high resolution displays. The trick of course is to avoid compromising the quality of either input signal. Let's face it if you shell out multiple thousands of dollars for let's say a 30" screen you want that screen to be as functional as possible.
I also take an interest in the mention of the smaller displays. One way to look at this is that this foretells a handheld product from Apple that isn't on the market yet.
Dave
Now maybe I can expect a new 23" LCD Cinema Display.
That'd be fantastic if they did
_____________
- matte/non-glossy laptop screens in something besides gargantuan 17"?
Check out the LG announcements, they are putting out a 15" OLED panel starting about now. Think about that in the lid of a MacBook Air, making it a quarter of an inch thinner, lower power, brighter even in sunlight, 180 degree viewing angle...
And with lifetime and the blue color problems just about solved for good, this is the time.
Here is what else will happen: OLED in the iPhone, iPod Touch, and NetPad! Maybe even this Summer. Thinner, lighter devices at lower power. What's a NetPad? My prediction for Apple's next new device, not a netbook, not exactly a tablet, flat with a 7.75" screen. I have a detailed article at myallo.com/blog
OLED is where Apple will go, as prices come down.
Now maybe I can expect a new 23" LCD Cinema Display.
Considering that they have a new 24" display, I doubt that they would offer another model with only a 1" difference.
This deal is very coincedential since according to MacNN's report last week, LG is planning to sell their TVs with NetFlix built in them. So I'm hoping that this deal is to influence that decision and maybe have LG sell their TVs with Apple TV built in them instead.
That would be interesting and the only way Applecould get its AppleTV into a variety of TV types and sizes.
Hey, guess what? LG is a big player in the emerging OLED market.
...
OLED is where Apple will go, as prices come down.
I agree. I think most people don't understand the significance of OLED yet. Apple, because it sells higher-priced products, will be able to introduce OLED earlier than cut-rate commodity PC producers. A contract like this can only help further that along.
OLED could make the Air thinner, but I think an even better use would be to give it a larger screen using the current cover. With OLED, a 14.1" screen would fit easily, and draw less power.
A curious thing about OLED is that we go back to one CRT characteristic, where dark images use less power (this doesn't happen with LCD), so a very low power draw could be achieved with the screen on; for instance a screensaver app showing a small clock moving around the screen.
In the handheld space, OLED will have a huge impact.
Hey, guess what? LG is a big player in the emerging OLED market.
Check out the LG announcements, they are putting out a 15" OLED panel starting about now. Think about that in the lid of a MacBook Air, making it a quarter of an inch thinner, lower power, brighter even in sunlight, 180 degree viewing angle...
Here is what else will happen: OLED in the iPhone, iPod Touch, and NetPad! Maybe even this Summer.
I wouldn't bet on it. Maintream OLED is still at least a couple years away. Sony's 11" OLED panel is still retailing for a cool $2,500, and LG's 15" is sure to garner more. Plus, Sony demo'ed a 27" OLED panel at CES (enormous for OLED at this point in time, but still quite small for panel sizes), and their response was basically no one could dream of affording this right now- it is only on display as a glimpse of things to come. Even at sizes like those of the iPhone, an OLED LCD screen would jack up the retail price tremendously...
Maybe Apple TV will be actual TV? 32", 47" 56" perhaps
If Apple goes OLED, its gonna be the end to all other competitors for sometime.
http://www.appleinsider.com/articles...e_designs.html
Still, dreaming of an Air with a 14" OLED whats not to drool over
I wouldn't bet on it. Maintream OLED is still at least a couple years away. Sony's 11" OLED panel is still retailing for a cool $2,500, and LG's 15" is sure to garner more. Plus, Sony demo'ed a 27" OLED panel at CES (enormous for OLED at this point in time, but still quite small for panel sizes), and their response was basically no one could dream of affording this right now- it is only on display as a glimpse of things to come. Even at sizes like those of the iPhone, an OLED LCD screen would jack up the retail price tremendously...
The price of Sony's XEL-1 OLED TV has already dropped to $1,748.51.
Thats still crazy expensive for an 11" TV but it is dropping.
http://www.engadget.com/2008/08/05/s...lub-for-1-748/
I wouldn't bet on it. Maintream OLED is still at least a couple years away. Sony's 11" OLED panel is still retailing for a cool $2,500, and LG's 15" is sure to garner more. Plus, Sony demo'ed a 27" OLED panel at CES (enormous for OLED at this point in time, but still quite small for panel sizes), and their response was basically no one could dream of affording this right now- it is only on display as a glimpse of things to come. Even at sizes like those of the iPhone, an OLED LCD screen would jack up the retail price tremendously...
I would bet on it. Apple is the company that put SSD in when people said
no one could dream of affording it and it was for the distant future. Now we see
SSD prices fallling. I'm not saying Apple gets all the credit for bringing us the
future faster, but I think they smell the future a bit better than other companies and
jump on it. That has to help.
OLED is a huge step forward. I for one will be happy to see it in Apple products
before the others come along and look like copy-cats. This is one reason Apple
keeps their product lines pricey -- it allows them to afford to include stuff that's
so new it's not anywhere else yet. When they do that, the new stuff gets spread
around pretty fast. We all benefit. Apple benefits too, because they had it first,
and showed the way.
My US$ 0.02.
I think we'll see it in a smaller device first, like a higher-end, higher-capacity iPhone, before we see it in any Mac product.
Hey, guess what? LG is a big player in the emerging OLED market.
Check out the LG announcements, they are putting out a 15" OLED panel starting about now. Think about that in the lid of a MacBook Air, making it a quarter of an inch thinner, lower power, brighter even in sunlight, 180 degree viewing angle...
And with lifetime and the blue color problems just about solved for good, this is the time.
Here is what else will happen: OLED in the iPhone, iPod Touch, and NetPad! Maybe even this Summer. Thinner, lighter devices at lower power. What's a NetPad? My prediction for Apple's next new device, not a netbook, not exactly a tablet, flat with a 7.75" screen. I have a detailed article at myallo.com/blog
OLED is where Apple will go, as prices come down.
Hey, guess what else? LG/Philips is the major manufacturer of the high-end IPS panels that Apple's been using in their Cinema Displays and high-end iMacs since forever. Being low-volume components that are used by almost no one other than Apple anymore (the cheap 6-bit TN panels being much more popular, but completely unsuitable for the graphics pros Apple caters to), these panels have probably the highest likelihood of increasing in price of any component Apple uses, and securing themselves a decent price on these panels is obviously what this deal is about.
I think 2009 would have been the year of the 25-30" OLED displays, but they would be in the $5,000-$6,000 range. Which is a lot, but if you think about it also a lot cheaper than the initial plasma displays a few years back, which ran at $8,000-$10,000.
However, in today's economy not too many buyers would be found and hence these companies are a bit stuck with their large size OLED display introduction plan.
But smaller to medium sized OLED screens are definitely coming up fast.
Look at OQO. They just introduced an ultra portable with 5" OLED display and 800x480 resolution starting at $999. That resolution is almost 3x the iPhone's. Or in other words, I can definitely see an OLED display at the iPhone's 320x480 in a highend iPhone very soon.
So the price is not the real issue anymore, the capacity is. Currently no OLED manufacturer could build enough OLEDs to fill the volume iPhones are shipping in. They'd have to ramp up their production at least 3 to 5 fold.
Yet no one would do that kind of investment unless they have a guaranteed several year-long supply contract...
Hey, guess what else? LG/Philips is the major manufacturer of the high-end IPS panels that Apple's been using in their Cinema Displays and high-end iMacs since forever. Being low-volume components that are used by almost no one other than Apple anymore (the cheap 6-bit TN panels being much more popular, but completely unsuitable for the graphics pros Apple caters to), these panels have probably the highest likelihood of increasing in price of any component Apple uses, and securing themselves a decent price on these panels is obviously what this deal is about.
I think you pretty much hit the nail on the head here. This deal is more likely exactly what it says it is, a deal to secure panel production for the near future in times of economic uncertainty. It stabilises their supply line and costs them very little to nothing in return.
OLED is still crazy expensive, if it appears in any near term products it will be either a high-end luxury laptop like the Air, or a small device like the iPhone where the small screen size keeps the costs down and the power savings justify the decrease in the margins.