Does This Technology Spell Trouble for Apple?

This year's Consumer Electronic Show highlighted several new highly coveted technologies that centered around displays, specifically Ultra HD and organic light-emitting diodes, or OLED. While the thrust of each is primarily focused on TV applications, Samsung unveiled "Youm" at the CES, making sure to include a Microsoft Windows Phone prototype that featured the technology. The appeal of OLED displays is that they are both flexible and nearly indestructible.

The inclusion of Microsoft has led to a certain degree of speculation that Samsung's first release of Youm will be with Microsoft and not on a Google Android smartphone. While others are working on OLED technology, Samsung is believed to be well ahead of its competitors. Even if a Windows phone is the first to receive an OLED display, there is further speculation that the Galaxy S IV -- a revamp of the popular Galaxy S III -- will also receive this type of display. What is clear is that Apple is not likely to be included in early releases. Will this be be the latest advance that allow the competition to push on Apple's market share?

The history of the technology
As hard as it may be to believe, the first LEDs were introduced in 1962 and the research that forms the basis of OLED was actually done in 1960. Despite this longstanding underlying technology, it has only been in the last few years that commercially viable versions of OLEDs have become available. This is largely driven by the fact that the organic material used in OLEDs is both unstable and breaks down much faster than those used in traditional LEDs. Certain colors -- blue, for example -- also have the tendency to break down more quickly than other colors.


The advantage of OLED, however, is that it produces color richness that cannot be matchedby any other currently available option. Furthermore, because of the super-fast refresh rates, fast-moving images are able to move fluidly across the screen. Sports fans who believe that the jump to HD has made a significant difference will likely be amazed at the advance represented by OLED.

Current applications
At the CES, Samsung presented prototypes of curved screens and flexible handheld devices, and highlighted a unique design advantage of the Youm technology. Thanks to of the flexible properties of the OLED display, devices that use this technology can incorporate displays that wrap around the edge of the device itself. In the demonstration performed by Samsung, the company rep showed how even with the device's cover closed, a text message could be displayed on the side of the device. I would recommend following the link because words do not do justice to this application.

Samsung's Brian Berkley explained that "[b]ecause OLEDs produce their own light, [they] don't require thick, heavy, power-consuming back lights." This part of the technology is of critical importance for mobile applications where battery life can make or break a product. If Samsung can help to create innovative new options that also include superior battery life, early adopters will likely produce significant sales.

Race for the top
The fact that Samsung chose to feature a Microsoft smartphone may be nothing more than simple good fortune for the Windows giant, but it may be a preview of things to come. If Microsoft is able to secure the cutting-edge display technology for one of its phones ahead of either Android or iOS, it will represent the company's latest victory. Microsoft's first victory came when Nokia was able to secure a critical contract with China Mobile to carry the Lumia line of Windows smartphones. China Mobile is the largest wireless carrier in China (and in the world).

Microsoft's most recent win came indirectly when Nokia recently announced that it would surpass expectations in the most recent quarter, largely as a result of the fact that the company sold 4.4 million Lumia smartphones. This number was a sharp increase from the 2.9 million that the company sold in the third quarter. The uptick in sales has made Nokia profitable for the first time in many quarters. Speculation suggests that Nokia could closely follow Samsung in releasing a smartphone utilizing OLED.

The Apple impact
The problem for Apple is that Samsung is believed to control as much as 90% of the global supplyof OLED displays, and these two companies are serious frenemies. Apple's lag in this technology can be traced back to Steve Jobs. At the 2010 Worldwide Developers Conference, Jobs said that the Retina display was the better technologyon the market: "You can't make an OLED display with this resolution, we think it is quite superior."

Since that comment, Samsung has solved many of the resolution and integrity issues that had been facing OLED. The application potential of a display that is both flexible and capable of being wrapped around a new device may prove to be a serious problem for Apple. At a time when many believe that Apple has lost some of its innovative advantage, being late to this party may represent another troubling setback that investors should consider as Samsung and others bring OLED options to market.

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The article Does This Technology Spell Trouble for Apple? originally appeared on Fool.com.

Fool contributor Doug Ehrman has no position in any stocks mentioned. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple, Google, and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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bps163

Apple is now doing what HP did! Started making there products to bleed the costumer of money but it's not going to work this time. Just look at HP stock price down 95% and why it's bleeding it's costumers in INK for the printers to parts for their computers. Just to night I spent over 89.00 at BJs for INK for a C7200 printer. That's what's Killing HP the cost to run there junk and now it's happening to Apple, new plug in cost, cheap phones and more. Thats why so many are moving over to the Kindle

January 14 2013 at 11:06 PM Report abuse rate up rate down Reply