Thursday, November 24, 2011

Apple Sinks $1 Billion in iPhone 5 LTE, iPad 3, iTV - Report

Fortune’s Philip Elmer-Dewitt did, and he points out to the key findings of Peter Misek on his trip to Japan as of late.

Misek’s "key takeaway" was not that Apple is making an iTV, or that the iPhone 5 is coming with LTE networking, or even that the iPad 3 will have a Retina display (all of which has been rumored for a while already).

It was actually the fact that Apple has poured as much as 1 billion dollars into a new panel supplier (Sharp), complete with new screen technologies and building hardware, in order to muffle any competitor’s attempts to… well, compete.

In an attempt to eliminate any potential misinterpretation of Misek’s research note, the Forbes report quotes the analyst’s note without paraphrasing or taking sentences out of context.

One key bullet reads: “We believe Apple has shifted display production and that Sharp has now become a large panel supplier, based on our checks. We believe that the Gen 6 Kameyama facility has been exclusively taken over for Apple purposes with Apple purchasing $500M to $1B of equipment for the manufacturing of iPad 3 and iPhone 5 LTE displays.”

Another highlight - Misek’s firm believes the iPad 3 display has been in production for weeks, and it’s “the cause of much of the noise in the supply chain.” Other key notes from Misek’s paper include:

· We believe that Apple may use this facility for the vast majority of the iPad 3 displays.

· For the iPhone 5 LTE we also believe this new facility will be used to supply displays.

· Even after the iPad 3 launch, we believe Apple will continue to produce the iPad 2 and will lower the price by $100 to $200.

· ...we believe that Apple and Sharp will jointly develop OLED panels for use in iPhone and iPad within the next 1 to 2 years.

· Based on our checks we believe OLED is only slated for small and mid-sized panels (i.e., iPad, iPhone). iTV is unlikely to receive OLED treatment until 2015.