Samsung and LG have finally settled on an OLED TV deal, report says

Samsung and LG have finally settled on an OLED TV deal, report says
May 2023

After years of resisting the move from LCD to OLED and reportedly going back and forth with LG Display about a potential OLED panel deal, Samsung Electronics has finally decided to buy OLED TV panels from its rival, Reuters reported today, citing three anonymous sources.

LG Display and Samsung have reportedly been doing this dance for years. In 2021, the South Korean firms were reportedly nearing a deal that would see Samsung revive its OLED TV business. But by 2021, a Samsung official was purportedly saying that Samsung's quantum-dot based LED (QLED) TVs "have better picture quality than OLED TVs," and, come 2022, reports claimed that said deal was no longer in the works due to price concerns.

Reuters' report today said LG Display and Samsung have finally agreed on a "high-end TV panels" deal. It cited people it said didn't want to be named as the deal isn't public and said LG Display and Samsung wouldn't comment.

Reuters said Samsung will receive 2 million OLED TV panels from LG Display in 2024, followed by 3 million and 5 million in the following years, according to "two sources with direct knowledge of the matter." At first, Samsung is "likely" receiving 77- and 83-inch WOLED TV panels, Reuters said. This is a much bigger deal than the over 200,000 WOLED TV panels The Elec said the two firms were discussing in April.

Samsung temporarily stopped releasing OLED TVs after 2013 due to high prices and high hopes for its QLED TVs competing with strong image quality and lower prices. In 2017, David Lowes, chief marketing officer for Samsung Electronics Europe, told IFA that Samsung wouldn't reenter the OLED market any time soon "because QLED is free of burn-in issues and cost-effectively scales for larger screens," per Sammobile.

"We believe that QLED is the TV technology of the future," Lowes added.

But the future is now, and the TV hotness, it turns out, is OLED. OLED contrast continues to impress people, and TV makers implemented techniques, like gently shifting pixels, to help users reduce burn-in risk. It's now impossible for Samsung's TV business to sweep OLED under the rug, as evidenced by its 2022 entrance back into OLED TVs.

Samsung's OLED TVs have been relying on Samsung Display's quantum dot-based OLED panels (QD-OLED). This February, it expanded its QD-OLED TV selection to up to 77 inches. But beyond outdoor, Mini LED, and 8K offerings, the 77-inch QD-OLEDs are Samsung's most expensive TVs ($3,600-$4,500 MSRP as of this writing). A deal with LG Display, as reported, could allow Samsung to get into even larger OLED TVs and add lower-price options to its OLED TV selection, which currently comprises expensive QD-OLED screens. For comparison, LG currently lists 77-inch TVs with LG Display-made WOLED panels with MSRPs as low as $2,300.

In 2021, when talks of a Samsung-LG Display OLED deal started, South Korea had just lost its spot as the top display maker to China. There were reports that the South Korean government pushed Samsung and LG to play nicely over concerns of Chinese firms, such as BOE, hiking LCD prices. Last month, UBI Research CEO Choong Hoon Yi again pointed to the negative impact that Chinese display makers controlling the LCD market may have on LG and Samsung and their partners, as per The Elec.

At the same time, OLEDs are getting increasingly larger pieces of the TV sales pie, making a firm OLED strategy critical for high-end TV participants moving forward.

On the LCD side of TVs, Samsung is seeing competition from low-priced options from Chinese rivals like TCL. Meanwhile, its overall profits were down 95 percent in Q1 2023, while LG hasn't made a profit since Q2 2022.

Reuters reported that shipping 2 million OLED TV panels to Samsung would give LG Display "at least $1.5 billion" and equate to "around 20 percent to 30 percent of its total manufacturing capacity for large-size OLED panels, taking it to full capacity, according to analysts."

And Samsung, now playing OLED TV catchup, could try to grow its portfolio and 6.1 percent OLED TV market share, which trails LG (54.6 percent) and Sony (26.1 percent), according to Omdia research numbers Reuters shared.

There are many technologists waiting with bated breath for Micro LED to become a serious part of these consumer-TV wars. But in the immediate future, OLED, with its impressive contrast, improving prices, and, among newer products, improved brightness, is the one to watch. With the LCD market becoming hard to stand out in, especially price-wise, an OLED partnership could give these South Korean tech giants hope for staying competitive.