The Japanese government has bailed out struggling Apple display supplier Japan Display with a 75 billion yen ($636 million) aid package, the company admitted today.
The government-backed Innovation Network Corp. of Japan owns 36 percent of Japan Display, which works on Apple’s iPhones.
The money is supposedly going to help Japan Display invest more heavily in OLED screens, which it made the massive tactical error of avoiding.
As per previous reports, Japan Display made the fatal mistake of doubling-down on its investment in LCD technology, while other companies were busy increasing their focus on OLED, which offers brighter display colors and sharper contrasts. As a result of this failure, Japan Display has been branded the “big loser” as Apple moves toward adopting OLED displays for the 2017 iPhone refresh.
At one point, Japan Display was ready to make a bid to become Apple’s primary iPhone display maker, and even went as far as building a $1.4 billion dedicated to servicing Cupertino. However, 2016 has been a disappointing year — with a notable lowlight being its failure to acquire Sharp, which holds various OLED-related patents. In the end, the company was bought by Foxconn instead.
Still, it’s nice to have friends in high places who can bail you out if you run into problems, eh?
Japan Display isn’t the only company having problem with OLED displays for Apple, however. A report last month claimed that multiple Apple suppliers lack the necessary capacity to make the quantity of iPhone displays Apple needs.
In addition to Japan Display, Samsung Display, LG and the aforementioned Sharp are all in the display-making business, but with the exception of Samsung all are struggling. If Samsung cannot deliver on Apple’s 100 million unit order, Apple could be stuck in a position with no fallback.
Let’s hope that doesn’t turn out to be the case!
Source: WSJ
Luke Dormehl is a U.K.-based journalist and author, with a background working in documentary film for Channel 4 and the BBC. He is the author of The Apple Revolution and The Formula: How Algorithms Solve All Our Problems … and Create More, both published by Penguin/Random House. His tech writing has also appeared in Wired, Fast Company, Techmeme and other publications.
