iPhone 5 Supply Shortage May Be Due To In-Cell Displays

Increased waiting time for pre-orders, a sales figure of 5 million units and reduced supplies to stores like Walmart, Best Buy and Target, all suggest that Apple’s having difficulties in satisfying demand for the iPhone 5.

According to Bloomberg, the constraint in supplies is said to be linked to in-cell displays.

The iPhone 5 touchscreen is powered by a relatively new technology called in-cell display, which merges the touch sensor and the display layer, enabling a much thinner device.

The nascent state of the technology, however, means that manufacturers are still having difficulties in ramping up the production of these in-cell displays to match iPhone 5 demand. Currently Apple sources in-cell displays form LG Display and Japan Display.

From Bloomberg’s report:

Manufacturing enough of [in-cell displays] for Apple has been challenging for LG and Japan Display, analysts at [Barclays] the London- based financial-services provider said.


The supply constraints may be short lived, [IHS iSuppli analyst Tom] Dinges said. Because of the large sums Apple spends on components, the iPhone and iPad maker will be the first in line for parts, he said.

“It’s a problem that everybody else would love to have,” Dinges said. “Even if you are going to run in to some areas where there are supply shortages, Apple is going to to get a disproportionate amount of the available supply — they are your best customer.”

The supply of in-cell displays would also increase once Sharp, another Apple supplier, gets over its initial hiccups and starts producing these displays.

Additionally Bloomberg suggests that the new integrated Qualcomm LTE chips used in the iPhone 5 might also be responsible to a certain extent for the supply constraints.

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