Apple has decided to shut down an in-house program to design and build displays for the Apple Watch, according to a Bloomberg report on Friday, citing unnamed sources with knowledge of the matter. The move comes just months after the company binned its EV plans and turn focus towards artificial intelligence technologies.
Apple Axes MicroLED Display Manufacturing Citing Cost Concerns, Employees Laid Off
According to the report, Apple is bringing an end to a protracted attempt to research and develop displays for its wearables due to the high costs and complexities involved. In recent weeks, the tech giant discontinued an in-house initiative to produce display panels with microLED technology.
These displays producing vivid colors and brighter images were supposed to be included in a future iteration of the Apple Watch before possibly being used in other devices.
The company is now working on reorganizing the team that handled the engineering of the display technology while cutting several dozen production and supply chain jobs in the United States and Asia.
The development came around the same time Apple decided to axe its self-driving car project. Most of the affected employees are given the opportunities to find other roles within the company. In the case they can’t find new jobs, the workers would be laid off and provided severance.
Currently, Apple uses displays sourced from companies like Samsung SDI and LG Display Co. for a majority of its devices. Even though the company customizes the panels before they are put into production, most of the designs are done by its partners.
Apple wanted to bring more of that process within its walls to gain a competitive advantage over its rivals, such as Samsung and Google.
Apple Saw a MicroLED led Future for its Devices
Apple saw potential in developing microLED display panels, which are made from millions of microscopic light-emitting diodes. The technology is said to use less power, produce more accurate colors, and allow for devices with a thin form factor.
The project codenamed ‘T159’ was started seven years ago from within the company’s hardware engineering department, before later shifting to under the wings of Wei Chen – who heads Apple’s display team. A few years ago, T159 was reallocated to the company’s hardware division.
Apple went as far as even building its screen manufacturing facility in Santa Clara, California, close to its headquarters in Cupertino.
The report suggests that there were hundreds of employees hired to handle the production of microLED screens. The job cuts planned by Apple involve people at that site along with its display engineering centers in Asia.
Apple saw MicroLED as the successor to Organic LEDs, or OLEDs, and was pushing to incorporate it into all of its products, from Apple Watches to iPhones to Macs. In 2018, the company believed that it would be able to launch an Apple Watch with a microLED screen as early as 2020.
However, the timeline was first delayed until this year, then 2025 and beyond. In Apple’s defense, micro LEDs were difficult to produce in sufficient quantities as they required using cutting-edge technology and a complicated process called LED transfer – which involved the placing of pixels in the display.
Apple’s Manufacturing Partners Face Big Losses
While Apple owned the design and manufactured the micro-LEDs, several companies were contracted to handle mass production and tasks like LED transfers.
One such partner was AMS-Osram AG, which last week announced that it was losing Apple’s micro-LED-related contracts. AMS said the cancellation would force it to lay off employees, potentially sell a manufacturing plant, and write off $1 billion in debt.
Apple now believes OLEDs are the way to go for the Watch’s screen, but still has plans for MicroLEDs on other devices down the road.
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