According to DIGITIMES Research, Apple (AAPL -0.69%) has been hard at work on four new iPhones. The devices include the following:
- An iPhone with a 5.7- to 5.8-inch liquid crystal display (LCD).
- An iPhone with a 6- to 6.1-inch LCD.
- An iPhone with a 6- to 6.1-inch organic light-emitting diode (OLED) display.
- An iPhone with a 6.4- to 6.5-inch OLED display.
OLED displays offer some significant image quality and speed benefits compared to LCDs, but OLED displays are harder to manufacture and there are fewer suppliers of them. Both factors ultimately make OLED displays more expensive than LCDs.
Image source: Apple.
Apple had previously been rumored to be working on three new iPhone models for 2018 -- one with a 5.85-inch OLED display, one with a 6.46-inch OLED display, and a lower-cost model with a 6.1-inch LCD.
Two of the previously rumored models show up in DIGITIMES Research's set of future iPhones (current rumors point to a 6.1-inch LCD model as well as a 6.46-inch OLED model in development), but this list seems to have two models that haven't really been talked about before -- the 5.7- to 5.8-inch LCD iPhone and the 6- to 6.1-inch OLED iPhone.
On top of that, DIGITIMES Research says that Apple is now leaning toward releasing two LCD-based iPhones this year (the 5.7- to 5.8-inch model as well as the 6- to 6.1-inch model) alongside a single OLED-based iPhone -- the one with the jumbo-sized 6.46-inch display.
Apple had, according the report, previously been planning to release the two OLED iPhones as well as the 6.1-inch LCD model.
Here's why these claims seem suspect.
Major contradiction
One of the best-connected Apple analysts is KGI Securities' Ming-Chi Kuo. According to Kuo, Apple is planning to launch two OLED-based iPhones this year -- one with a 5.85-inch OLED display (the same as the one on the current iPhone X) and one with a 6.46-inch OLED display (effectively a larger version of the successor to the current iPhone X).
In addition to those two iPhones, Kuo also says Apple is planning a phone with a 6.1-inch LCD for more price-sensitive smartphone shoppers.
Considering that Kuo has been steadily releasing detailed specifications of these devices for quite some time, and considering Kuo's considerable Apple supply chain connections, I'd be much more comfortable betting on Kuo's information than virtually any other analyst's.
Questionable business sense
Admittedly the argument above might not be all that convincing to some -- I'm essentially saying that one source is probably more reliable than the other, but the reality is that sometimes reliable sources get things wrong and relatively unknown sources can get things totally right.
To that end, I think it's worth thinking through these claims from a business/marketing perspective.
Image source: Apple.
When Apple introduced the iPhone X, it made quite a big deal about the work that it put into the OLED display that the device uses. On top of that, the lack of OLED displays on iPhones had been a competitive disadvantage (perceived or otherwise) for Apple for quite some time.
The move to an OLED display and the significant marketing that Apple has invested in extolling the virtues of the technology make it seem quite unlikely that Apple would use an inferior technology on two of its three upcoming flagship devices -- again -- and limit OLED technology to a single premium model.
Apple was forced to limit OLED technology to a single model in the 2017 iPhone lineup, likely due to cost and capacity constraints, but it's unlikely those constraints will persist into the next product cycle, especially as Apple brings additional OLED suppliers on-board (Apple has only a single OLED display supplier for the current iPhone X).
Apple would be hurting its competitive positioning by not expanding its use of OLED display technology in the 2018 iPhones.
Supply chain havoc
The final thing to keep in mind is that iPhone development cycles are long and Apple relies on many suppliers for critical components. The reality is that because of the sheer scale that Apple operates at, it needs to work with its suppliers years in advance on technology development.
On top of that, Apple's suppliers need to have some idea of how much component demand Apple will need for a product cycle well in advance so that they can build the appropriate manufacturing capacity.
At this point, it's highly likely that Apple's OLED display suppliers (Samsung and possibly LG Display) have already been given some indication as to how much demand Apple expects for its 2018 iPhones. Those companies need to make sure that they put the appropriate capacity in to support the cycle.
If Apple were to decide at the last minute to switch from releasing two OLED-based iPhones and one LCD model in 2018 to one OLED model and two LCD models, then that'd potentially leave Apple's OLED suppliers holding a pretty big bag. On top of that, there may not be enough capacity in place at Apple's key LCD suppliers to meet its demand, especially on such short notice.
