El Segundo, Calif. - Limited supplies of small-size AMOLED displays are hampering the ability of AMOLED-equipped Android smartphones to compete with Apple's iPhone, iSuppli said.
Shortages of AMOLED displays have been cited by Verizon for delayed shipments of the HTC-made Droid Incredible.
AMOLED offer several advantages over AMLCD (active matrix LCD) screens used in the iPhone and other smartphones. Advantages include lower power consumption and thinness.
Google's Nexus One was the first Android smartphone to use an AMOLED. Another will be Samsung's Galaxy S, due this year from all four major carriers.
"Android-based smartphones have aggressively adopted high-quality AMOLED displays as a competitive differentiator against the advanced-technology AMLCD screen used in the iPhone," said iSuppli analyst Vinita Jakhanwal "However, rising demand combined with a limited supply base has led to the constrained availability of AMOLEDs."
AMOLED displays use no backlight, offering power-saving advantages of particular benefit to power-hungry smart phones, he said. In addition, the lack of a backlight makes AMOLED displays very thin compared with AMLCDs. Finally, AMOLEDs offer faster motion display and a richer color gamut. On the other hand, AMLCDs have fixed-cost advantages because AMOLEDs have been around only for a few years, he noted.
Samsung and LG are spearheading the development of AMOLED, so "what the two companies do will determine whether the technology moves beyond its current niche status into a position in which the technology becomes a viable competitor for mobile handset displays," Jakhanwal said.
To increase supply, Samsung plans to get an additional Generation 5.5 factory up and running at the end of 2011, and LG is starting a new Generation 4.5 plant, iSuppli said. Right now, these two companies are the only sources for AMOLED panels, although SMD plans to start production in 2012. Taiwan-based AU Optronics and TPO Display are also planning to introduce AMOLED products at the end of 2010 or early 2011.
"Overall, handset makers are pushing to make displays available in mass-volume production from AMOLED suppliers." Jakhanwal said. "In a market that is becoming highly competitive with a perceptible emphasis on distinctive features and improved performance, AMOLED may offer manufacturers crucial and much-needed choices with which they can achieve product differentiation."