What analysts think about iPhone 7 demand
In the previous part of the series, we saw that Apple’s (AAPL) new iPhone 7 may not have any major changes in the external design. It could house new features such as a thinner design and a faster processor built on Taiwan Semiconductor Manufacturing’s (TSM) 16nm (nanometer) node.
Apple is facing technology stagnation in the smartphone market, which has led to longer upgrade cycles. Many analysts aren’t very optimistic about the iPhone 7 demand. Jan Dawson, chief analyst at Jackdaw Research, said, “There are so many uncertainties right now in forecasting iPhone demand, driven by the global smartphone slowdown, the lengthening upgrade cycles and other factors. As such, even Apple will likely struggle to forecast with any certainty how many phones they’re likely to sell in any given period.”
Rumor: 2017 iPhone model to have a major design change
Analysts are optimistic about the demand for the next flagship product after the iPhone 7. Rumors are circulating that the iPhone 7s could have a major change in design when Apple launches it in 2017. According to rumors, the 2017 iPhone model could feature an all-glass, curved screen built on OLED (organic light-emitting diode) technology. The model is said to get rid of the physical home button and instead have it on the OLED touchscreen.
Benefits of OLED
An OLED display doesn’t need a backlight, which makes its contrast ratios higher, offering richer colors and darker blacks. When the need for a backlight is eliminated, it reduces power consumption. OLED displays are also thinner and more flexible than LCD screens, which would allow Apple to make a curved screen. The company currently uses OLED in its smartwatches.
News confirming OLED rumors
Applied Materials (AMAT) has reported a fourfold increase in display orders driven by demand for OLED technology. Apple’s three key suppliers—Japan’s (EWJ) Sharp, South Korea’s (EWY) LG Display, and Samsung (SSNLF)—have increased their investments in new display technologies.
There were rumors that Apple would introduce OLED technology in the iPhone 7, but this is unlikely. It takes AMAT at least three quarters to build, deliver, and install the machines it uses to make OLED. So if AMAT received orders in 1Q16, the machines would be delivered at the start of 2017 and would be available in iPhones by September 2017.
Analysts are worried that Apple users might skip the moderate upgrade of the iPhone 7 and wait for the 2017 model. However, demand will be driven by what Apple has to offer with the iPhone 7.