One of the areas where Apple (NASDAQ:AAPL) products, particularly the iPhone, excel is in their displays. When the iPhone 6/6 Plus launched, Display Mate's Dr. Raymond Soneira called the display found on the iPhone 6 Plus the "best performing smartphone LCD display [sic] that [Display Mate has] ever tested."
The display was praised for its high brightness, low screen reflectance, excellent contrast ratio, accurate colors and contrast, and strong viewing angles.
Interestingly enough, there has been quite a lot of speculation and/or hope that Apple would move away from traditional LCDs in favor of OLEDs for its upcoming iPhones. Indeed, a recent report from Korea's ET News suggested that Samsung (NASDAQOTH:SSNLF) Display, a leading vendor of OLED-based smartphone displays, is even sampling OLED-based displays to Apple for its next-generation iPhone.
According to a research report from generally accurate analyst Ming-Chi Kuo, however, it is apparently highly unlikely that Apple will move away from LCDs for the iPhone within the next three years.
Let's take a closer look at his reasoning.
Comments from Mineba appear to be the basis of this report
In a recent investor presentation from Apple LCD backlight vendor Mineba, the company showed the following slide:
Mineba argues that LCDs offer a number of advantages over OLEDs, such as manufacturing costs (this is a big one for Apple, which wants to keep its margins as high as possible), lifespan, high resolution, and more.
Additionally, Mineba says that various vendors within the LCD supply chain are working to build "ultra-thin LED chips and optical sheet[s]" in order to try to maintain technical advantages over OLED-based displays.
Foxconn's big LCD bet may be a tip-off
In addition to citing the comments from Mineba's most recent investor presentation, Kuo pointed to the fact Foxconn, also known as Hon-Hai Precision Industry, has made an agreement with the Chinese government to build LCD production plants in in the country.
Kuo claims that these factories will start producing LCDs starting in 2018 and that the purpose of these facilities is to try to win mobile LCD orders from Apple for future iPhones.
Despite OLED hype, plenty of room left to innovate in LCDs
Although much has been made of the advantages that OLEDs have over LCDs, particularly in terms of black levels, there still appears to be plenty left to do to advance traditional LCDs.
For example, in Display Mate's iPhone 6/6 Plus display analysis, Soneira points out that a major leap that LCD manufacturers will have to make in future-generation displays will be to improve image quality and screen readability in ambient light.
Viewing displays in ambient light conditions, Soneira points out, leads to "reduced image contrast, color saturation, and color accuracy." Perhaps Apple and its suppliers will make some substantial progress on this front with the next generation iPhone 7/7 Plus displays?
Additionally, it's worth pointing out that there are mobile LCDs currently on the market that offer deeper black levels and higher contrast ratios than what the iPhone 6s/6s Plus offer, so Apple will almost certainly make some advancements on this front with its next-generation iPhone displays.
Finally, Soneira noted in his iPhone 6/6 Plus analysis that, in order to deliver support for wider color gamuts, Apple and its suppliers may have to adopt Quantum Dot LCD technology.
Interestingly enough, in a recent interview with Backchannel's Steven Levy, an Apple executive said that the company passed on Quantum Dots as a means to widen the color gamuts on its new Retina iMac 4K/5K displays as the technology requires the use of the toxic element cadmium.
Instead, Apple and its suppliers developed an alternative LED technology that allowed Apple to widen the color gamut on its new iMacs while avoiding the deleterious environmental impact associated with Quantum Dots. It wouldn't be a surprise to see Apple leverage its investments in this technology in future iPhone displays.
Ashraf Eassa has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.