Apple is about to take even more control

Apple's taking big steps toward controlling even more primary technology

Things may be about to get tough for some Apple partners as the company invests in top secret display technology development labs and increases its control over the primary technologies used in its products.

Diverse partnerships

Not that this is any real surprise. One thing Apple learned when it found itself embroiled in its endless war with Samsung is the cost and the consequence of tying the knot with a faithless partner.

Apple has worked hard to diversify its production and supply partners ever since.

Apple CEO, Tim Cook, put his cards on the table way back in 2009 when (as COO) he said: “We believe that we need to own and control the primary technologies behind the products we make, and participate only in markets where we can make a significant contribution.”

Bloomberg today reports Apple is moving to develop the next-generation of display technologies. It has opened an Apple building in Longtan, northern Taiwan, in which it has at least 50 engineers and other workers creating new screens for devices including iPhones and iPads. The company has bought in workers from partners at Qualcomm and AU Optronics to develop these displays.


“Apple began operating the lab this year as it aims to make products thinner, lighter, brighter and more energy-efficient. Engineers are developing more-advanced versions of the liquid-crystal displays currently used in iPhones, iPads and Mac personal computers, the people said. Apple also is keen to move to organic light-emitting diodes, which are even thinner and don’t require a backlight,” the report informs.

OLED-based displays aren’t widely available in smartphones because they are costly to produce, so it seems likely Apple is working to develop new production, process and materials to drive the costs of the technology down. Now, we already know the company has been involving itself in display technology design – in one recent public incarnation of this the company explained its invention of red-green phosphor LEDs that enable the new iMacs to display a much wider range of red, green and blue than other displays.

Unique selling points

The company also developed its own unique timing controllers and color calibration tools designed to make its new desktops the best available. That’s the power of owning primary technologies.

Apple may simply intend to augment OLED technologies for future products, given claims last week that Japan Display will create them for iPhones in 2018. (KGI Securities analyst Ming-Chi Kuo reported that Apple would not switch to OLED displays for the next three years).

Factory fresh

In another move Apple has acquired a former semiconductor manufacturing building for $18.2 million, claiming these premises will be used for office space and R&D.

It is important to understand just how much custom design is involved in Apple products, from antenna to processors, display timing controllers and beyond, the company’s products are increasingly Apple-designed at a component level, enabling (we presume) improved integration between Apple-designed software and Apple-designed kit.


However, with the end of 2015 approaching and claims Apple’s next big reveal will be the Apple Car in or beyond 2018, it does look like the company will be hoping to iterate future business on the back of existing products, and will invest heavily in technology and process to underpin this aim in the months and years ahead.

Coming soon, of course, we can expect a 4-inch iPhone (very likely introduced along with a global extension of its iPhone Upgrade Program in defiance of Huberty’s predictions for iOS next year); a new Apple Watch, Apple TV enhancements and, of course, significant innovation across iPads, Macs and iPhones.

However, it is possible the company finds itself in a bit of a lull as it develops new product categories, so HomeKit and CarPlay and other forms of IoT integration will hold sway and R&D investments will peak. With this in mind I anticipate the company will move to put in place even firmer controls over the technologies used in its devices.

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Copyright © 2015 IDG Communications, Inc.

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