Sharp allegedly facing cost, production challenges on iPhone 5 screen

Sharp allegedly facing cost, production challenges on iPhone 5 screen

Sharp, which was recently claimed to have begun manufacturing screens for Apple upcoming iPhone 5 launch, is now rumored to be facing higher than expected costs, and hints production may fall behind schedule if they don't get some extra cash from Apple... Reiji Murai reports for Reuters:

The Japanese display maker is struggling with high costs that have cut into its margins on the screens, raising the question of whether Apple might provide financial incentives to speed up production, the source said.

At first blush, Sharp leaking to the press they're making the screens, then leaking that those screens may sound less like a news story and more like "Hey, Apple, sure would be unfortunate if you don't get your fancy new screens on time, wouldn't it?" In other words, the cheesy shakedown plots to half the cheap TV procedurals in the 80s.

However, Apple did face supply constraints with the iPhone 4 and iPad, often blamed on the availability of the displays. With the iPhone 4S and particularly the iPad 3, Apple showed even a 2048x1536 Retina display couldn't stop them from rolling out more volume, to more countries, faster than ever before.

But the iPhone 5 is rumored to use new, in-cell technology for the display, allowing for a single, 0.5mm slimmer layer. Production on those is still ramping up, and it's not inconceivable that yield rates could play a roll in how Apple plans international launches between the first stage (which includes the U.S.) on September 21, the second stage on or around October 5, and subsequent stages.

We'll find out on September 12 when Apple is expected to hold their next iPhone event.

Source: Reuters

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Rene Ritchie

Editor-in-Chief of iMore, co-host of Iterate, Debug, Review, Vector, and MacBreak Weekly podcasts. Cook, grappler, photon wrangler. Follow him on Twitter and Google+.

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Reader comments

Sharp allegedly facing cost, production challenges on iPhone 5 screen

6 Comments

It would be rather ironic and humorous if Sharp held Apple hostage on display delivery thanks to a lower than expected "yield rate". ;-)

Yep, this is a classic marketing 101 tactic. Create false shortage and then a fear of loss by the consumer ignites insane demand. Nintendo did it with the Wii and Apple continues to do it with every release of the iPhone and iPad. Don't get me wrong, I'm upgrading ASAP, but Apple knows there's no shortage of idiots who will buy ANYTHING if you create enough demand for it; artificially or not.

Exactly my first thought. Free publicity, and getting people to believe its in limited supply. Genius. They only thing Apple gets right is marketing.