Apple is seeking a price cut of nearly 10% for Samsung's OLED displays

Apple is seeking a price cut of nearly 10% for Samsung's OLED displays
Apple is reportedly seeking a price cut from Samsung on the price of OLED panels. Apple’s first device to sport an OLED display, the iPhone X, has so far seen much weaker demand than initially anticipated, which has forced Apple to cut orders by up to 50%. One of the main reasons behind this, unsurprisingly, is reportedly the high price of the smartphone.

Now, despite recent reports that claimed Apple’s next flagship devices would be even more expensive than the company’s current iPhone X, Apple appears to be negotiating a near-10% price cut with Samsung in the hope of cutting costs which, ultimately, should allow the company to bring down prices slightly and improve demand. After all, OLED panels equate to nearly a third of the total iPhone X production costs, and, if successful with negotiations, Apple will have guaranteed itself a $10 price cut per panel down to a new $100 price tag. This new deal could also prove beneficial to Samsung due to the fact that Apple is expected to up display orders to a total of 100 million units, of which 25 million will be for the current iPhone X, and the remaining 75 million will be for the company’s 2018 devices.

It’s reported that Apple had initially hoped to use other manufacturers in its negotiations with Samsung in the hope of forcing it to lowers its prices. According to recent reports, however, the likes of LG and others are not yet capacitated to reach the demand Apple requires, with the only option being Samsung, which therefore removes any guarantee that the Silicon Valley-based company will receive its price cut. Interestingly, however, it was recently mentioned that Samsung had reportedly offered Apple use of its Y-Octa panels which are currently present in the Galaxy S9 lineup and are much cheaper to produce. 

In any case, Apple appears to have learned from its mistakes, with the company said to be expecting much more conservative sales figures when it comes to the upcoming iPhone Xs and Xs Plus. Instead, the tech giants now expects the cheaper LCD-sporting device to be the biggest seller of the upcoming trio.

source: Digitimes

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40 Comments

1. haruken

Posts: 307; Member since: Nov 06, 2013

Samsung shouldn't do it. No one else can come close to their level of quality when it comes to Oled screens. Should Apple go with another manufacturer, they'll get bashed for poor quality.

4. rubyonrails3

Posts: 375; Member since: Oct 01, 2014

Note 8 had superior display than S9+, so I'm assuming next iPhone will have inferior display. this is noticeable in movies in dark scene. if you want to test this. play the frankenstein chronicles from Nextflix and iPhone X have best output than S9+ or V30+

25. sgodsell

Posts: 7451; Member since: Mar 16, 2013

If I was Samsung I would say to Apple since your such a great customer and your customers are willing to pay for anything you make. Then I believe we are going to increase your price by 10%. Since you asked us so nicely, and want things better for you, well we decided we want things better for us, especially when we have fines to pay for. Plus you are always looking to drop us as a vendor anyway. Now we know you will agree to pay the extra 10% for bothering us. Because if you don't we will add another 10% fee on top of the first 10% fee. We love you Apple pricks, I mean we love people like you for being such a good customer Apple. This extra fee we will call it the FU fee, well because it's a good fee, and your customers are always willing to pay the extra FU fees you give to your customers. Now have a great day Apple. We know we will have a great day as well. Thanks for bothering us again.

24. srgonu

Posts: 557; Member since: Feb 13, 2012

Customers were seeking price cut in Apple products for years. What happened?

2. Atrixboyyy

Posts: 607; Member since: Nov 03, 2011

always charging the most, trying to pay the least... typical.

5. RebelwithoutaClue unregistered

Yeah, what strange business model they have

11. TechSceptic

Posts: 1156; Member since: Feb 05, 2018

Yeah, but there is a limit to what kind of profit margins you should require out of your product. The larger the profit margins, the more you're paying for a device that isn't really worth that much. Apple's profit margins are much higher than any other company, so if you buy an Apple product, then you're probably paying a significant bit more for it than someone who bought a product of similar value from another brand, as they don't have as extreme profit margins.

13. RebelwithoutaClue unregistered

So Ferrari, Lamborghini, Bugatti, Rolls Royce,etc should all lower their prices despite people paying that kind of money for it because you think there is a limit to it?

14. TechSceptic

Posts: 1156; Member since: Feb 05, 2018

You can't compare a freaking Ferrari, Rolls Royce, Bugatti and so on to a smartphone, that's utterly ridiculous. I don't even need to say more than that, because that's a horrible analogy.

16. RebelwithoutaClue unregistered

So Rolex, Cartier, Louis Vuitton, Armani should all lower their prices. Why can't I compare products when it's just the price? Hell, I think $500 for a pound of coffee is insane. But it's all about what are people willing to pay for them. If Apple prices were too high, people wouldn't buy them. Do I think it's idiotic those high prices? Yup, I do. Do I think Apple is in the wrong for asking such high prices (or making these high profits)? Nope, I don't.

17. TechSceptic

Posts: 1156; Member since: Feb 05, 2018

Who ever said that they were in the wrong for asking for ridiculous profits? No one. You're talking mostly from the perspective of Apple, while i'm focusing more on the perspective of a consumer. There should be a limit to what kind of profit margins you accept a company to make. You shouldn't just simply accept profit margins that are infinitely big, unless you're completely fine with paying 1000$ for a product that is really only worth 200$, as the rest is profit margins for the company. If that happens, then you might want to expand your narrow train of thought and look beyond such a brand, and instead look at brands which doesn't incorporate such huge profit margins into their products, as they aren't as greedy. As i said, there should be a limit to it, especially when we're talking about smartphones which aren't really that unique products, as you can find something just like it from another brand.

18. RebelwithoutaClue unregistered

Since I was mentioning the business model, of course, I am talking about the perspective of the company (in this case Apple). And why bother with either company or consumer if it's not your call to make (or your money). I never bought an iPhone and my current daily driver is an OP3T (the iPhones that I 'Own(ed)' are company issued ones). So I get your choice as well (how much you would pay for a smartphone). But I don't judge companies for making the most possible profit in a legal (and ethical) way.

26. TechSceptic

Posts: 1156; Member since: Feb 05, 2018

"And why bother with either company or consumer if it's not your call to make (or your money)." What do you mean? I'm not forcing anyone to buy anything at gun point. It's just my opinion, but i'm not forcing anyone to do anything. "But I don't judge companies for making the most possible profit in a legal (and ethical) way." Really? I do judge companies through an ethical point of view, as i personally find it important that i can buy a product without a guilty conscience, so i would generally stay away from companies that are ethically grey or black. If a company has shady business practises and use excessive amounts of energy to remove competition, then that puts me off. A good example was Apple and them trying to sue a repair shop in Norway for simply repairing iPhones without doing anything wrong. The fact that Apple lost that case as a multi-billionaire company against a single guy, says it all.

37. RebelwithoutaClue unregistered

Are you blind? "But I don't judge companies for making the most possible profit in a legal (and ethical) way." Which means I don't judge companies for maximizing profit as long as it's legal and ethical. Of course, I judge companies from an ethical point of view. Although it's hard to judge the grey operating companies since I don't know a company that hasn't done grey area sh!t.

28. NarutoKage14

Posts: 1327; Member since: Aug 31, 2016

Forgetting supply and demand. There is demand for 200 million Apple devices per year while Apple can produce 220 million per year. There is demand for 50,000 Ferrari's, Lamborghini's and Bugatti's per year yet those companies can only produce 30,000 per year. Just admit when something is overpriced.

36. RebelwithoutaClue unregistered

This has absolutely nothing to do with how much they can make. If I look at Louis Vuitton bags, they can be easily made in the millions by those Chinese kids and still they are expensive. It has to do with how much are people willing to pay for a certain item. If demand for a high prices item is there, supply it. It there isn't demand for it, either don't supply or lower your prices. And of course a Ferrari is not the same as an iPhone, that is why there is such a big difference in pricing between the two. Which is totally not my point. Ps those supercar makers can produce a lot more if they want, but that would make the price go down

39. P-YWS

Posts: 151; Member since: Aug 12, 2011

You are wrong in the examples quoted. Supercar makers often cannot produce a lot more! The engines and mechanicals take time to produce. Likewise, the materials which are used to make the LV handbags are in limited production run. In contrast, iPhone is a mass market product.

40. RebelwithoutaClue unregistered

Hire more people to build them. If I look at Lamborghini, owned by Volkswagen, I'm pretty sure expanding their manufacturing line wouldn't be a problem. And the materials in an LV handbag aren't that rare or difficult to produce.

29. iushnt

Posts: 3122; Member since: Feb 06, 2013

They are not made for average consumers.

32. theunspoken

Posts: 310; Member since: Jul 06, 2017

You have money and willing to buy it, then buy or else stfu. Ferrari,Lamborghini didn't ask you to buy their cars, people buy it cuz they know the value of such cars. This is not true in case of Apple.

34. ijuanp03

Posts: 615; Member since: Dec 30, 2014

Apple iPhone is JUST a phone. This isn't cars so you can't compare them to a toy smartphone.

35. P-YWS

Posts: 151; Member since: Aug 12, 2011

Your statement accurately reflects the truth. However, there is no shortage of people who are lining up to donate throw away their money to Apple for the over-hyped and under-achieved iPhones of the modern day.

3. Nimbus

Posts: 442; Member since: Apr 02, 2018

Cheaper LCD sporting to be the biggest seller of the upcoming trio nope i dont think so without fingerprint scanner in it how they can make that claim it so,when Face iD is not even secure as it prior biometric sensor iphone 8,8+ or close to even iris scanner sensor.Next year in 2019 they will make a comeback of fingerprint scanner in the screen with synaptic sensor on oled and JDi pixel touch Lcd fingerprint scanner on iphone 9 successor which will rip off the wallets of peoples who have buy this year iphones with their hard earn cash.Let see after the announcement how leaks about 2019 iphones will be true then or get change compare to now what the leaks are saying but i say dont buy this iphones just like S9 skip this year unless leaks about 2019 iphones don't get change suddenly in apple mind to include notch again and inscreen no fingerprint scanner.

7. Sunbae-min

Posts: 135; Member since: Mar 25, 2018

May I know where you take your English class?

9. peace247 unregistered

I know he's an as&...but what's the problem if he's not able to write proper english....maybe it's not his first language....

6. Sunbae-min

Posts: 135; Member since: Mar 25, 2018

Is it a difficult deal? Don't buy OLED no more, and use that old LCD panel which you claimed it's the best Retina display ever. Samsung would keep the stock for the Note 9 products.

8. Nexus4lifes

Posts: 298; Member since: Feb 13, 2014

Samsung should cut their prices but apple won't cut their profit - wow super logic apple.. Samsung should show apple their longest finger.

10. TechSceptic

Posts: 1156; Member since: Feb 05, 2018

I could tell you an even easier way for Apple to lower their prices, and it's quite simple. The way Apple could lower the prices would be by reducing their profit margins, simple. Apple doesn't sell a higher number of smartphones than Samsung does, they really only account for around 15% of the total smartphone shipments, yet they earn around 80% of the total profits. Apple clearly has much higher profit margins than any other brand out there, which is why their prices are typically higher than all of their competitors. If Apple simply accepted slightly smaller profit margins, then the prices would be easily lowered for consumers. I'm sure that even with lowered profit margins that they would still have a bigger profit margin than any other smartphone brand out there. This would lead to a lower price, which should lead to more sales, as more people can afford it. Apple is sadly way too greedy to accept the same profit margins as other brands have, they want to produce the phone at the lowest cost possible and then bump the price up for the consumer as much as they possibly can, while other brands seem more conservative with their profit margins and pricing.

23. mootu

Posts: 1530; Member since: Mar 16, 2017

Apple is reported to be making around 40% profit from every phone it sells, they actually pay retailers the least for selling them as well, as low as 1% to 2%. There is one other company reported to be making roughly the same profit margin, Huawei, they are said to also be raking in around 40% per device. The big difference is they have a lower ASP.

12. conceptvbs1

Posts: 6; Member since: Oct 18, 2017

Apple will surely pass on their savings to their end users (customers) /s

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