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Apple to Pay $500 Million Advancement to LG for Flat Panel Displays

In tough economic times, LG has managed to secure a high profile deal with Apple Inc, to supply the tech giant a “massive amount” of flat panel displays.

apple flat panelIn a statement by the Korean based company, they explained, “LG Display has made a long-term agreement to supply a massive amount of LCD to Apple in the face of uneasy condition of foreign capital inflow amid the global economic downturn.” However no further details have been made available.

What this means for Apple remains relatively unclear. While it may be easy to assume that this automatically pertains to future Cinema Displays, that’s not the case. Back in November, Apple ended shipments of the 23″ Cinema Display to make way for the 24″ LED Display that was released the previous September.

Reports straight from LG explain that Apple’s contract calls for LCD displays, so it’s entirely possible that Apple may venture into other categories with these displays. In October, Mahalo founder Jason Calacanis claimed to have direct sources inside Apple that were telling him an HD television set was definitively in the works. Additionally, the country is in the midst of a switch to full digital television, seemingly blocking out analog signals. We’ve previously outlined why it would be as good a time as any for Apple to enter this market, if they ever do.

From the Associated Press: SEOUL, South Korea (AP) — LG Display Co. has reached a long-term deal with Apple Inc. to supply flat panels to the iconic maker of computers, music players and smart phones.

The contract between the two companies is for five years and calls for LG to receive an advance payment of $500 million sometime this month, the South Korean company said in a regulatory filing Monday.

Seoul-based LG Display and Apple, headquartered in Cupertino, California, planned to decide later on details such as the number of panels LG will provide, LG said.
LG Display declined to provide further details.

Shares in LG Display fell 0.8 percent to close at 23,550 won ($17.33).

The rest of Apple’s Cinema Display lineup remains untouched. Speculation about the Cinema Displays making an appearance at Macworld ‘09 was brief, but none of it came to fruition. If Apple ever does get into the HD television market, they will have to be incredibly careful with pricing. Too wide of a gap between Apple and its competitors wouldn’t bode well for moving units.

Comments [2]

2 Comments to “Apple to Pay $500 Million Advancement to LG for Flat Panel Displays”

shishir @ January 12th, 2009 at 6:27 am
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Well Apple has brought down its prices but its not only a question of a company but a matter to look upon as why Apple has slashed its prices. I have my views on http://controversial-affairs.blogspot.com/2009/01/price-or-prize.html

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Aviv @ January 12th, 2009 at 7:53 am
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Hey shishir… Even if Apple diligently explains why its prices are “considered” too high, it still won’t lessen the price gap between some of their products and their competitors.

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