Apple seems to have started to take some concrete measures to reach the number one position in the list of most valuable US brands. The brand has now decided to rope in LG as its second supplier of OLED screens for iPhones. This step is taken in the wake of Apple’s sincere efforts to reduce iPhone costs and the dependence of its archrival Samsung Electronics.
Notably, Apple’s dwindling position from number one (2012-2016) position on the list of most valuable US brands was due to premium products, which put Apple’s brand value at risk. Learning an important lesson, Apple will soon sign up the second supplier for the organic light-emitting diode screens for its celebrated iPhones.
LG to Become Second Supplier of OLED Screens for Apple iPhones
According to the sources familiar to both companies, LG will supply between two million and four million units to Apple. Later on, this number will increase, as LG would augment its capacity to produce more OLED screens.
This new deal will give Apple an edge in its negotiations with Samsung, who is the only supplier of OLED displays for iPhone X. As per industry pundits, the expense of displays is the key reason iPhone X price starts at $1000 and Apple’s failure to meet the sales expectations.
Experts believe that successful deal would create a win-win situation for Apple and LG. Apple can buy OLED screens in bulk from LG and consequently reduce the prices of future iPhones. For LG, this deal would bring a fresh source of revenue as it fights the slump in the price of liquid crystal displays.
Getting a second supplier of OLED screens was crucial for Apple, as it wants to send a message the Samsung is not the only pebble on the beach. Once Apple will begin to receive large volumes of OLED displays, it can certainly lower the pricing and meet its sales expectations.
Industry insiders believe that the first batch of OLED screen will be used in one model of the new iPhones likely to be released this year.
Apple is planning to release three mobile devices later this year; this will include two phones with OLED screens. To win the game, Apple has to control its prices as many consumers had turned to the competition by ditching iPhone X last year.
The new deal will bring some relief for Apple, as it doesn’t have to rely on its primary rival – Samsung. There is a fierce competition between the two brands and anything is possible.