The production capacity of OLED panels has been taken over by Apple and Samsung. How should domestic mobile phones respond in the future?

Recently, according to foreign media reports, Apple has placed a contract for the production of 70 million OLED screens for Samsung Electronics. It is worth noting that Samsung currently accounts for over 90% of the OLED display screen market in the smart phone industry. In addition to Samsung's own mobile phones and tablet products, it can be said that OLED panel production capacity has been taken over by Apple and Samsung. So, how should domestic mobile phones respond in the future?

Apple signed huge OLED orders

It is reported that the iPhone 8 will be the first iPhone to adopt an OLED screen, which is expected to be released in September this year. Therefore, in order to stock the OLED panel for the upcoming iPhone 8, Apple has recently placed a super big order for Samsung. It is understood that Apple has signed a two-year supply agreement for small-size OLED panels with Samsung Display Panel manufacturer Samsung Display.

Under the agreement, Samsung Display will supply Apple with a small-sized OLED panel worth about $9 billion (about 62.1 billion yuan). Among them, Samsung Display will supply 70 million to 92 million small-size OLED panels to Apple this year.

Since entering 2017, OLED screens have become a new driving force for the appearance of mobile phones. From the previous years, Samsung S6 edge began to face the OLED screen and began to enter the mass market. By 2017, the appearance of mobile phones requires a large amount of screen promotion. The design of the recently released Samsung Galaxy S8 is amazing, and there is an OLED screen.

It is worth noting that Samsung Display has begun to expand its OLED screen production line and invested nearly 10 trillion won (about 614 billion yuan) this year. Samsung Display has signed an agreement with a number of device manufacturers to replace existing LCD screen production lines with OLED screen production lines.

Samsung controls OLED production capacity

It is understood that OLED is called organic electroluminescent diode, which has many technical advantages such as self-illumination, low power consumption, high brightness, ultra-thin, and flexibility. It is the most promising high-end display mainstream technology.

Since OLED production is very difficult, its core technology lies in upstream precision manufacturing, while precision manufacturing requires precision-manufactured equipment, and the production capacity of these equipment is limited. OLED's core evaporation equipment is controlled by Canon's evaporation machine manufacturer Tokki, and Samsung has locked orders for Tokki's production capacity in advance.

Not only that, the current OLED screen is Samsung's only one, Samsung's AMOLED screens account for more than 90% of the OLED market share, other screen manufacturers' OLED production process, screen quality, capacity are all opened by Samsung Electronics far.

In this way, Samsung not only monopolizes the current production capacity of OLED, but also controls the upstream manufacturers to limit the speed of other manufacturers entering the OLED industry.

For the upcoming iPhone 8, it will be the first iPhone with an OLED screen. When the iPhone 8 adopts an OLED screen, major Android phone manufacturers will surely follow suit, and the capacity of OLED screens is currently extremely limited. It is foreseeable that in the next two years, OLED screens will probably be one of the most compact mobile phone components.

It is worth noting that another technology company, Google, has recently proposed to invest at least 1 trillion won (about 6 billion yuan) to help LG Electronics increase the production of organic light-emitting diode (OLED) screens. According to reports, Google's move is aimed at obtaining a stable source of OLED screen supply for its new Pixel smartphone.

How to counterattack domestic mobile phones?

As the penetration rate of smartphones continues to increase, the growth rate of the world's major smartphone market is rapidly declining, and the smartphone market has changed from an incremental market to a stock market. In the stock market era, the demand for replacement will replace the demand for new purchases into the mainstream of the market. The advent of the era of replacement will increase the demand for high-end products in the market, driving high-end panel growth such as high resolution, large size and flexibility.

Therefore, in the face of the combination of Apple and Samsung, domestic manufacturers must also counterattack.

On the one hand, panel makers have stepped up the construction of vapor deposition equipment. Although Samsung controls Tokki's production capacity, Apple's big orders have also stimulated other Korean manufacturers to follow suit. SUNIC, YAS and SFA are all manufacturing OLED evaporation equipment for Chinese manufacturers. SFA said it has delivered 4.5 for Chinese partners. An evaporation device for OLED lines. Since May last year, SUNIC has also begun to provide large-scale evaporation equipment for LGD.

On the other hand, domestic mobile phone manufacturers must also work closely with domestic panel makers. Huawei and BBK signed an OLED alliance agreement and will continue to increase investment in OLEDs from this year. BBK has established a panel company called MGV, which plans to mass produce 60,000 OLED screens per month.