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Samsung demands Apple pays penalty for OLED orders

Report from Korea says Samsung has made a claim that Apple should pay penalty for below-par OLED panel orders. Apple traditionally uses LCD panels for its iPhones but that changed with iPhone X which was released in the fourth quarter of 2017. Samsung happens to be the sole supplier of OLED panels for the iPhones. Sadly, Apple's requirements regarding iPhone sales were not met. As a result, the order made for Samsung OLED panels lower than what was agreed.
Apparently, Samsung and Apple had signed a deal pegging the minimum OLED orders. Reports had it that Apple was expected to get an initial shipment of 50 million panels in 2017. Samsung was then billed to ramp up to 200 million by 2018. Unfortunately, demand for the iPhone was below Apple's OLED orders were trimmed down repeatedly. Samsung Display now wants Apple to pay a penalty for missing its minimum order quantity.
Samsung had high hopes for Apple's OLED panel demand such that it had planned to build a "super OLED factory" in China back in 2017 to meet rising demand. The factory was supposed to have 30 percent more production capacity than the company's existing A3 plant where Apple's OLED iPhone panels are made. The last that was heard about the factory is that Samsung had to jettison investing about $ 1 billion in the new OLED plant. But then, the company already made some investments in its A3 plant in order to meet Apple's demand. Thus, the South Korean tech giant is looking to get hundreds of millions of dollars from Apple as a penalty. Apple is not keen on paying any penalty but has instead offered to source OLED panels for other products like tablets and notebooks. We will have to wait to see if this will be settled amicably or will end up in another lawsuit. G. C.