Shortage of OLED-Making Machines Could Potentially Impact Production of 2017 iPhone

Amid rumors suggesting Apple is planning on introducing at least one iPhone model with a flexible OLED display in 2017, Bloomberg has taken a closer look at Japanese company Canon Tokki, the corporation responsible for making the machines that will likely be used to create OLED displays for the iPhone.

Canon Tokki is said to produce nearly all of the machines that make OLED Displays. Each ELVESS OLED machine is actually a vacuum production system that's 328 feet in length and is used to deposit red, blue, and green pixels on a glass surface using evaporating organic materials.

Canon Tokki has developed key technologies for the production process that have significantly reduced the margin of error, leading to much higher yields that other companies can't compete with.

canontokkimachine
According to Bloomberg, Canon Tokki reportedly makes fewer than 10 machines per year and has a two-year backlog due to high-demand, but it is not clear if this will have an impact on Apple. Apple is rumored to be using OLED displays produced by Samsung, and much of the equipment may already be on hand.

Samsung's own line of smartphones have used OLED displays for several years, but Blooomberg does warn that Samsung may not be able to make enough OLED displays to meet Apple's demand due to low yield rates.

The potential production bottleneck is raising questions over Apple's ability to feature OLED displays in next year's iPhones, and whether the Cupertino, California-based company will be able to line up additional suppliers. The current wait for a machine, which can cost more than 10 billion yen ($85 million) each, is about two years.

"We are doing all we can to increase output and make that wait shorter," said Chief Executive Officer Teruhisa Tsugami, adding that demand from display makers, including Samsung Display Co., LG Display Co. and Sharp Corp., will remain strong for the next three years.

OLED displays offer superior contrast and better power efficiency for improved battery life compared to traditional LCDs. OLED displays can also be made from flexible plastic and can be made much thinner.

According to rumors, Apple will release at least one iPhone model that uses an OLED display in 2017, but rumors have disagreed on what the display will look like. While some rumors suggest the iPhone 8 will use a curved OLED display that wraps around the edges of the device (similar to the Galaxy S7 Edge), others point towards less dramatic curves, suggesting a flat OLED display that eliminates all bezels for an edge-to-edge design.

Top Rated Comments

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45 months ago
It wouldn't be an iPhone release unless there was a shortage on some component!
Score: 51 Votes (Like | Disagree)
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45 months ago
Can't wait to get my preorder in at 12:01am and get a shipping estimate for 2 months later.
Score: 24 Votes (Like | Disagree)
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45 months ago
Lol getting us ready for another iPhone 6 event
Score: 22 Votes (Like | Disagree)
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45 months ago
big surprise, theres an excuse for every single shortage of every single product
Score: 15 Votes (Like | Disagree)
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45 months ago
I love how the majority of MR posters will blame Apple for this, i.e. "There's an excuse for every single shortage..." Sucks to be Apple these days, well, except for the millions of products they continue to sell.
Score: 12 Votes (Like | Disagree)
Avatar
45 months ago
How many times do we have to put up with this stuff?

I've been a Mac fanboy for years, and this feels like Apple of the early 1990's.

Tons of SKU's, inability to deliver, crappy hardware, buggy software, just such a shame.

I go to the Apple store and hope there's something I'd want to buy, but there's nothing.
Last time I got an overpriced watch band for my son. Felt really cheated.

Time before that was an Apple TV (the new one). It's really bad. So hard to use. Remote is not good at all.

Now I see Tim Cook is picking fights with the president elect. I can't stand him either but if I were the CEO of a big company I'll tell you what, I'd be hugging and smiling. Your employees depend on you. Your fanbase depends on you. Get over it. Build something. There's a time and a place for everything.

It might just be time to fire the Cook. I might have to bite the bullet and buy some Apple stock to put up a shareholder proposal at the next meeting. Just so frustrated.
Score: 7 Votes (Like | Disagree)

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