Samsung has a tight grip on Apple ahead of the launch of the iPhone 8.
According to reports, Apple is switching from LCD displays to OLED displays for its new phones. But the only company that is able to make the displays at scale is Apple’s biggest competitor in smartphones — Samsung.
Apple Insider reports that that leaves Samsung in a position of huge bargaining power. The screens are estimated to cost between $120 and $130 per unit, a much higher cost than the $45-$55 cost of the LCD screen of the iPhone 7 Plus.
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While there are other OLED panel vendors that Apple could theoretically turn to, Samsung currently produces the highest volume of the displays. Apple will need millions of the displays for its new iPhones, putting it in a bind. Samsung also holds the majority of OLED technology patents according to Apple Insider, and accounted for 97.7 percent of global production in April of last year.
Apple’s sole reliance on Samsung also means that any slowdown in production of the displays could affect iPhone availability. Business Insider reports that there are already warnings of supply falling short. However, for those less eager to get the latest and greatest in display technology, it is expected that Apple will launch two other iPhone models that will use the older LCD technology.