The Korea times has reported that Samsung is on the verge of splitting off its OLED display division from the LCD production lines that have brought in huge losses due to difficult business conditions.
This is a wise move from Samsung. The LCD technology is on the fall as they offer inferior picture quality when compared to the OLED screens and are also commanding less market share than previous years. Samsung Has also prepared an exit strategy where it will be completely out of mobile LCD business within 2 years.
“Samsung Display separated the company’s OLED business division and more of Samsung Display’s workforce joined the OLED business unit. The latest decision was part of the ongoing Samsung Group-initiated efforts to restructure unprofitable businesses,” said an official who is familiar with the issue, Monday. “Now, Samsung is initiating an exit strategy for LCDs, which are no longer promising and have become unprofitable,”
The LCD unit might end up being acquired by the Samsung electronics division since its owns the lion’s share of Samsung display. These production lines will be used in manufacturing the LCD televisions in the future.
The second reason could be the huge OLED contract that Samsung display has with Apple to supply as many as 200 million OLED displays for the iPhone scheduled for September 2017.
“Samsung Electronics has no imminent plans to invest more in OLED TVs as TVs based on LCD technology such as quantum dot displays are customized to keep Samsung plants operating given the manufacturing infrastructure,” said a fund manager from a U.S.-based investment bank in Seoul.
“The OLED trend is for real. OLED will be accounting for a third of all smartphone displays by 2018,”
