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Low-Priced Smartphone Displays – OLED To Push LCD Display Prices Down

The price competition is intensifying between low-temperature polycrystalline silicon liquid crystal displays (LTPS LCDs) and rigid organic light emitting diodes (OLEDs) to attract middle- to low-priced smartphone markets.

An LTPS LCD is prepared to drive out rigid OLEDs backed by price cuts thanks to the expansion of mass production capacities, while rigid OLEDs are in a mood to compete with a unit price cut strategy.

According to a new report by Display Supply Chain Consultants, the popularity of OLED displays is leading to an increase in competition between LCD and OLED suppliers. Until now, OLED panels have been largely reserved for flagship smartphones, with some exceptions, and even then not all flagships sported them – instead many opt for the more traditional LCD option.

Recently, though, the popularity of the panels has soared and a new report sees this increase in adoption continuing into the coming years. Thanks to a big push from Samsung in its more reasonably priced models recently, as well as the adoption of the panels by other premium manufacturers, demand for OLED displays has increased significantly over the past 12 months.

Because of this, the average price is also dropping, to the point of reaching an average of $34 for a typical 5.5-inch Full-HD display in the second quarter, down a respectable $5 versus the year before. Despite this, competition on the LCD front is becoming stronger, largely due to the supply. A push last year towards an increased production of LCD displays led to supply outweighing the demand, a factor that caused a big drop in price.

OLED Display , LCD In Q2 of 2016, a 5.5-inch LCD display sold for $35 per unit, not much more than the current price of OLED displays, but now the average price sits at just $27, giving manufacturers a big reason to choose LCD of OLED, especially in lower-priced devices. It’s because of this that OLED manufacturers are expected to gradually drop their prices over the coming months in order to better compete against LCD suppliers.

After all, moving towards providing displays for low and mid-range devices across the globe appears to be an objective, the downside being that it could slowly eat away at profits.

“If a factory operation rate falls, the production cost will increase. But it seems as competition intensifies, LTPS LCD makers have difficulty to such an extent that they stand a structure where they suffer from few margins or even loss,” DSCC said. “For the time being, a glut of LTPS LCDs will continue.”

On the bright side for suppliers, the demand for flexible OLED panels, such as those used in Samsung’s Galaxy Note 8, as well as those with an 18:9 aspect ratio is expected to soar over the coming year, meaning profits could be on the uprise once again by the end of this year. For now, the shift towards displays with a wider aspect ratio appears to be increasing the importance of display quality itself.

This, along with the dropping price of OLED panels means the shift away from LCD is more noticeable than ever, and at current rates, its projected that the popularity of the former will overtake the latter by 2020.

As for what this could mean for the end user, it’s mostly good news. OLED offers considerably better image quality, and the potential for less power consumption. Still, there are bound to be some growing pains for manufacturers other than Samsung, who haven’t had a years-long experience in building their own OLED panels.

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