Japan Display to Supply Apple With ‘Full Active’ LCD Panels for Some 2018 iPhones

Apple has expressed interest in buying advanced liquid crystal display (LCD) panels from Japan Display for use in some of its iPhones next year, according to a new report today from The Wall Street Journal.

Earlier this month, Apple announced the iPhone X, its first smartphone to adopt OLED screen technology. OLED displays offer sharper contrast and brighter colors than traditional LCD panels, but cost and supply issues are an ongoing concern for Apple, and are likely to slow down any full transition to the technology.


However, Japan Display's advanced LCD panels, which it calls Full Active LCDs, are said to match or exceed some of OLED's advantages at a lower cost, and Apple is interested in procuring them for use in at least some iPhones set to debut in its 2018 smartphone line-up, according to people familiar with the matter.

In Full Active panels, the bezel or border space around each edge of the screen has been trimmed to 0.5 millimeters, the Japanese maker says, compared with as much as several millimeters on older LCDs. Current OLED smartphone panels have a bezel of about one millimeter, which makes them easier to be curved or angled. The Full Active panel has already been used by several Chinese mobile makers, including Xiaomi for its Mi Mix 2 phone, according to Kazutaka Nagaoka, chief of Japan Display's mobile unit. 

News about Japanese Display's advanced LCD panels first emerged in January of this year, when they were referred to simply as "flexible LCDs". The panels were said to be bendable enough to manufacture smartphones with the same screen design as Samsung's Galaxy Edge series, thanks to a layer of plastic inside the glass. At the time, the company claimed mass production would begin from 2018.

Last month, Japan Display said that its Full Active displays would account for more than 70 percent of its business in panels for smartphones and other smart devices in the year ending March 2019. People at companies that work with Japan Display said interest about Full Active LCDs came directly from Apple, which is why the display maker is predicting rapid uptake for Full Active. Apple declined to comment on the report.

Apple's line-up of iPhones next year will introduce a larger-screened LCD model, measuring more than 6 inches, according to a rumor earlier this week. Based on the same part maker sources, Apple's supply of LCD screen from Japan Display already includes panel orders for the new larger screen size. Meanwhile, a switch to OLED-only iPhones is not expected until 2019.


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Apple Supplier Japan Display Potentially Seeking Help From Outside Investor for Shift to OLED

Last month, Apple supplier Japan Display reportedly asked local banks and its own shareholders for around $897 million to fund part of an "extensive" restructuring effort of its business, which would see the supplier's manufacturing output shift from LCD to OLED panels. Now, the company is said to be seeking an outside partner to help pay part of the funds (via Nikkei).

Japan Display is facing a troubled time due to its speciality of making LCD displays in an era when companies are slowly shifting to OLED-only smartphones, including its main customer Apple, so the restructuring money will go towards installing OLED panel lines at some of its plants.

A recent concept of the 2017 OLED iPhone 8

Japan Display is looking at investors both locally and abroad, who could both "shore up its shaky financial base" as well as help out with running manufacturing operations in the shift from LCD to OLED production. Its decision on an outside partner is said to be planned for "as soon as next year."
Smartphone makers including Apple, its largest customer, are increasingly turning away from LCDs and toward state-of-the-art organic light-emitting diode displays, where the Japanese company lags far behind South Korean rivals.

JDI, as the company is also known, has drawn up plans for extensive revamping in response, and is on the hunt for investors at home or abroad that can help shore up its shaky financial base and lend a hand in running operations.
Japan Display will begin with a cut back on LCD production as well as laying off "more than 3,500 workers" at parts assembly plants in China and the Philippines. In Japan, the company will initiate an "early retirement program" for 250 volunteers. LCD-focused plants, including a central location in Japan, will completely halt production and be repurposed for OLED panels, while the remaining workers will be transferred to other factories.

The cost of Japan Display's restructuring plans is estimated at around $1.35 billion, with many market watchers expecting the supplier to end its next fiscal year with another monetary loss, "marking the company's fourth straight year in the red." For its bank loans, three local banks have agreed to extend Japan Display new lines of credit worth about $997 million.

Other Apple suppliers have already begun making OLED panels, including the current leader in the field, Samsung Display, and up-and-comer LG Display. Apple itself is said to be investing in LG Display's OLED production, with the hopes that it can lessen its reliance on Samsung as it shifts to OLED-only iPhones in 2018 or 2019.

For Japan Display, the company's planned shift to OLED began with a report from December 2015, where it cited a plan to begin mass producing OLED panels for iPhones by spring 2018. Then, in November 2016, the supplier sought a government-backed fund to improve its LCD technology and introduce OLED lines at its plants.


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LCD Maker Japan Display Seeks Nearly $900 Million in Bank Loans Ahead of First iPhone With OLED Display

Loss-making LCD manufacturer Japan Display has reportedly asked banks and its largest shareholder for around 100 billion yen, or roughly $897 million, to fund restructuring efforts, according to Nikkei Asian Review and Reuters.

The Tokyo-based manufacturer of liquid crystal display panels, also known as JDI, requested the loan from lenders including Mizuho Bank and Sumitomo Mitsui Banking Corp. Innovation Network Corp. of Japan, the government-backed fund that is Japan Display's largest shareholder, will provide indirect support in the form of loan guarantees.
The capital raised will help Japan Display's turnaround efforts, which reportedly may involve halting production and trimming staff at smartphone panel plants in the central Japanese city of Nomi and China's Jiangsu Province.

Japan Display, formed in 2012 when the LCD divisions of Hitachi, Sony, and Toshiba merged, has lost money for a third consecutive year, reportedly due to problems getting smartphone panel production up to speed. The company also faces increased competition from South Korean and Chinese rivals.

Japan Display is also threatened by the increasing adoption of OLED displays in smartphones, which it doesn't produce. Samsung is currently the only company that can reliably manufacture OLED displays for smartphones, with LG and Foxconn aiming to begin mass production over the next few years.

Apple, which has long been Japan Display's biggest customer, is widely rumored to release its first iPhone with an OLED display in the coming months. At least two new iPhone models are expected to continue using LCDs, but rumors suggest Apple's entire iPhone lineup could use OLED displays by 2019.

Earlier reports have claimed Japan Display is also planning to manufacture OLED displays, but if it doesn't act fast, it could eventually lose Apple as a customer and face significantly worse financial problems.


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Apple Supplier Japan Display Creating Flexible LCD Panels for Use in Future iPhones

iPhone supplier Japan Display has come up with a plan to battle the increasing popularity of organic light-emitting diode (OLED) panel manufacturing, without needing to delve into the costly practice of creating OLED panels itself. According to a new report by The Wall Street Journal, the supplier has figured out a way to manufacture flexible liquid crystal display (LCD) panels using technology and processes it already has at its disposal.

Set to begin mass production in 2018, Japan Display's flexible LCD panels are said to be built with a layer of plastic instead of glass. "While not as flexible as OLED," the company's chief operating officer, Shuji Aruga, mentioned that the panels are bendable enough to manufacture smartphones with the same screen design as Samsung's Galaxy Edge series.

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According to people familiar with the matter, Apple has already begun looking at the flexible LCD panels for iPhone models launching in 2018 and beyond.
Japan Display officials said some smartphone makers, which they declined to name, have agreed to adopt the bendable LCD in the next few years. The company also hopes to sell the displays for other uses such as laptop computers and car dashboards.

“Mass production is planned from 2018, and we wouldn’t do that without demand from our clients,” said Mr. Aruga. Japan Display’s major clients, according to its financial statements, include Apple and Huawei Technologies Co.

Bendable displays could help revive growth in a smartphone market that is beginning to get saturated. People familiar with the matter have said Apple is looking at the displays for possible future iPhone models.
In addition to its plan to adapt LCD screens into flexible panels, Japan Display has previously acknowledged interest in OLED production, stating in late 2015 a goal to begin mass production of OLED panels by the spring of 2018. Last November, the supplier was said to be in "advanced talks" with the government-backed fund Innovation Network Corp. of Japan to receive around ¥75 billion ($662 million) in financing.

The bailout was said to be both for improving Japan Display's LCD technology, and potentially mass-producing its own OLED panels. Still, analysts looking at the move think that Japan Display "may not have the funds to pursue both technologies," so it's unclear at this point which panel technology the supplier will ultimately decide to stick with in the future.

For Apple, it's been long-rumored that at least one model of the 2017 iPhone 8 will come with an OLED screen -- supplied by Samsung -- which typically have sharper color contrast and brighter colors compared to LCD screens. Japan Display's domestic rival Sharp is currently expected to provide Apple with OLED panels as well, but not until mid-2018.

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