LG Display Co. (034220) is in talks to supply Panasonic Corp. (6752) with big-screen TV panels using its next-generation technology as the Japanese company tries to lower production costs, people familiar with the matter said.
LG Display, already a provider of smaller screens to Apple Inc., is seeking to boost adoption of organic light-emitting diode technology, the people said, asking not to be identified because the talks are private. The Seoul-based company is seeking to add other Japanese customers, the people said.
OLED technology, which offers a brighter and sharper picture than the more popular liquid-crystal displays, has struggled to win customers amid higher prices and sluggish demand for TVs. LG Electronics Inc. (066570), which owns about 38 percent of LG Display, is the biggest maker of sets using OLED, while chief competitor Samsung Electronics Co. (005930) focuses on LCD technology for its ultra high definition screens.
“Winning more orders from Japanese makers will certainly help the OLED TV market open up faster than expected,” said Claire Kim, an analyst at Daishin Securities Co. in Seoul. “I don’t think LG can aggressively slash OLED panel prices just yet. It will mainly target the high-premium market for a while.”
Seoul-based LG Display plans to supply OLED panels larger than 55 inches to Panasonic, two of the people familiar with the talks said.
Lee Sang Wook, a spokesman for LG Display, declined to comment on issues concerning customers. Chieko Gyobu, a spokeswoman for Osaka-based Panasonic, said the company is considering options for its OLED business and nothing has been decided.
LG Display reported an 80 billion-won ($79 million) net loss in the first quarter on lower sales in its tablet division, including for Apple’s iPad. Panasonic’s TV shipments fell 42 percent in the fourth quarter from a year earlier, according to data compiled by Bloomberg.
In January, LG Electronics, the world’s second-biggest TV maker, unveiled its first set with a flexible screen using OLED technology, which enables users to adjust how much the 77-inch display curves for viewers. Curved screens are designed to immerse viewers more in the programs they watch.
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