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Apple secretly starts developing own screens

Apple Inc is designing and producing its own device displays for the first time, using a secret manufacturing facility near its California headquarters to make small numbers of the screens for testing purposes, according to people familiar with the situation.

The technology giant is making a significant investment in the development of next-generation MicroLED screens, say the people, who requested anonymity to discuss internal planning.

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MicroLED screens use different light-emitting compounds than the current OLED displays and promise to make future gadgets slimmer, brighter and less power-hungry.

The screens are far more difficult to produce than OLED displays, and the company almost killed the project a year or so ago, the people say.

Engineers have since been making progress and the technology is now at an advanced stage, they say, though consumers will probably have to wait a few years before seeing the result.

The ambitious undertaking is the latest example of Apple bringing the design of key components in-house.

The company has designed chips powering its mobile devices for several years.

Its move into displays has the long-term potential to hurt a range of suppliers, from screen makers like Samsung Electronics Company, Japan Display Inc, Sharp Corporation and LG Display Company to companies like Synaptics Inc that produce chip-screen interfaces.

It may also hurt Universal Display Corp., a leading developer of OLED technology.  Display makers in Asia fell after Bloomberg News reported the plans. Japan Display dropped as much as 4.4 per cent, Sharp tumbled as much as 3.3 per cent and Samsung slid 1.4 per cent.

Controlling MicroLED technology would help Apple stand out in a maturing smartphone market and outgun rivals like Samsung that have been able to tout superior screens.

Ray Soneira, who runs screen tester DisplayMate Technologies, says bringing the design in-house is a “golden opportunity” for Apple. “Everyone can buy an OLED or LCD screen,” he says. “But Apple could own MicroLED.”

None of this will be easy. Mass producing the new screens will require new manufacturing equipment.

By the time the technology is ready, something else might have supplanted it.

Apple could run into insurmountable hurdles and abandon the project or push it back.

It’s also an expensive endeavor. Ultimately, Apple will likely outsource production of its new screen technology to minimize the risk of hurting its bottom line with manufacturing snafus.

The California facility is too small for mass-production, but the company wants to keep the proprietary technology away from its partners as long as possible, one of the people says.

“We put a lot of money into the facility,” this person says. “It’s big enough to get through the engineering builds and lets us keep everything in-house during the development stages.” An Apple spokeswoman declined to comment.

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Right now smartphones and other gadgets essentially use off-the-shelf display technology. The Apple Watch screen is made by LG Display. Ditto for Google’s larger Pixel phone.

The iPhone X, Apple’s first OLED phone, uses Samsung technology.

Phone manufacturers tweak screens to their specifications, and Apple has for years calibrated iPhone screens for color accuracy.

But this marks the first time Apple is designing screens end-to-end itself.

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