Strange Bedfellows
According to South Korean trade press, it seems that Samsung Electronics (005930.KS) is going to enter the OLED TV space this year, but not the QD/OLED set that affiliate Samsung Display (pvt) is developing (2022 more likely), but sets based on OLED panels produced by South Korean rival LG Display (LPL), the dominant supplier of large panel OLED displays. The two companies have said to have met voluntarily under the auspices of the Korean government and agreed on the framework with final details to be ironed out in the near-term. According to the source, Samsung and LG Display have committed to 1m units for this year and 4m units next year. Given that LGD’s expectations for total OLED panel production this year is between 7m and 8m units, the Samsung deal makes Samsung suddenly a large customer (quick estimate ~13%), and an even larger one next year if the deal plays out (~30%).
Samsung Electronics and LG Electronics have made some rather scathing comments about each other over the last few years while Samsung Display and LG Display a bit less, but this is certainly the first time that we can remember that Samsung has purchased OLED panels from LGD. We expect Samsung’s TV division understands that as Samsung Display winds down its LCD large panel production and begins scale production of its QD/OLED product, which could take time to produce acceptable yields, the division needs to keep itself as exposed to the premium TV market as possible. Samsung’s quantum dot LCD TVs certainly maintain a slot and the company will be building out its mini-LED TV offerings, but as the price of OLED TVs declines, especially relative to LCD TVs, Samsung must continue to feed customers new and different high-end TV product.
While justifying the potential QD/OLED TV would be relatively easy for Samsung’s marketing, given that Samsung has championed the use of quantum dots in the TV space for years and is the leader in small panel OLED production (“The Best of Both Technologies…”), but we expect would have a harder time justifying a pure OLED TV, especially one based on LGD’s WOLED technology, which Samsung has trashed many times over the years. Of course, they could choose to ignore the past (likely) and market the new OLED line as “Better than the Original…” by adding some bells and whistles not common to other OLED TV sets (likely), but in any case the real take away here is that regardless of stance or ‘face’, if there is a better way to generate profits for Samsung’s TV division, they will do it. IF LCD large panel prices continue to rise and OLED panel prices rise less, that spread is what matters and Samsung will likely tell new product marketing to stop thinking about how to sell the new line rather than dwelling on what has happened in the past. Samsung Electronics has stated that “The official position is that it is not true because it has not been confirmed. However with regard to securing parts, it is the basic policy to review competition without restricting them.”
Samsung Electronics and LG Electronics have made some rather scathing comments about each other over the last few years while Samsung Display and LG Display a bit less, but this is certainly the first time that we can remember that Samsung has purchased OLED panels from LGD. We expect Samsung’s TV division understands that as Samsung Display winds down its LCD large panel production and begins scale production of its QD/OLED product, which could take time to produce acceptable yields, the division needs to keep itself as exposed to the premium TV market as possible. Samsung’s quantum dot LCD TVs certainly maintain a slot and the company will be building out its mini-LED TV offerings, but as the price of OLED TVs declines, especially relative to LCD TVs, Samsung must continue to feed customers new and different high-end TV product.
While justifying the potential QD/OLED TV would be relatively easy for Samsung’s marketing, given that Samsung has championed the use of quantum dots in the TV space for years and is the leader in small panel OLED production (“The Best of Both Technologies…”), but we expect would have a harder time justifying a pure OLED TV, especially one based on LGD’s WOLED technology, which Samsung has trashed many times over the years. Of course, they could choose to ignore the past (likely) and market the new OLED line as “Better than the Original…” by adding some bells and whistles not common to other OLED TV sets (likely), but in any case the real take away here is that regardless of stance or ‘face’, if there is a better way to generate profits for Samsung’s TV division, they will do it. IF LCD large panel prices continue to rise and OLED panel prices rise less, that spread is what matters and Samsung will likely tell new product marketing to stop thinking about how to sell the new line rather than dwelling on what has happened in the past. Samsung Electronics has stated that “The official position is that it is not true because it has not been confirmed. However with regard to securing parts, it is the basic policy to review competition without restricting them.”
RSS Feed