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By Reuters | The Guardian
Supply chain sources say display panel production set back when backlight for smartphone screen had to be revised
Suppliers to Apple are scrambling to get enough screens ready for the new iPhone 6 smartphone as the need to redesign a key component disrupted production ahead of next month’s expected launch.
It is unclear whether the hiccup, revealed by supply chain sources, could delay the launch or limit the number of phones initially available to consumers. Apple is preparing to launch larger-screen iPhones for the year-end shopping season as it attempts to claw back the loss of market share to cheaper rivals.
But the issue highlights the risks and challenges that suppliers face to meet Apple’s tough specifications, and comes on the heels of a separate screen technology problem, since resolved, in making thinner screens for the larger iPhone 6 model. California-based Apple has scheduled a media event for 9 September and many expect it to unveil the new iPhone 6 with both 4.7 inch (11.94 cm) and 5.5 inch (13.97 cm) screens – bigger than the 4-inch screen on the iPhone 5s and 5c.
Two supply chain sources said that display panel production suffered a setback after the backlight that helps illuminate the screen had to be revised, putting screen assembly on hold for part of June and July. One said Apple, aiming for the thinnest phone possible, initially wanted to cut back to a single layer of backlight film, instead of the standard two layers, for the 4.7-inch screen, which went into mass production ahead of the 5.5-inch version.
But the new configuration was not bright enough and the backlight was sent back to the drawing board to fit in the extra layer, costing precious time and temporarily idling some screen assembly operations, the source said. Output is now back on track and suppliers are working flat-out to make up for lost time, the supply chain sources added.
Japan Display, Sharp and South Korea’s LG Display have been selected to make the iPhone 6 screens, the sources said. Representatives for those three suppliers, and for Apple, declined to comment. The new iPhone launch is keenly anticipated, with Apple shares going through the $100 barrier this week ahead of the product’s expected debut.
Apple is known to make tough demands on its parts suppliers for new iPhones and iPads as it competes to create designs, shapes, sizes and features to set it apart and command a premium price in a fiercely competitive gadget market. This can cause glitches and delays, including screen problems that limited supplies at last year’s launch of a high-resolution version of Apple’s iPad Mini.
It also highlights the danger for suppliers of depending too heavily on Apple for revenues, creating earnings volatility.