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Samsung is investing billions in manufacturing plants for the next iPhones

iPhone 8 display

When you think of Samsung and smartphones, chances are you’re imagining the Galaxy S8 or a gently smoldering Galaxy Note 7. But as well as making its own smartphones, Samsung is also a significant supplier of components to its rival, including Apple.

Since there’s only a couple months left until the iPhone 8 is made official, we already have a good idea that Samsung is going to have a hand in supplying OLED panels for Apple’s latest and greatest. But according to a new supply chain rumor, Samsung isn’t going to stop there.

ETNews quotes supply chain sources as saying that Samsung will shortly invest billions of dollars into a pair of new plants for producing OLED panels. The plants won’t be up and churning out displays until 2019, but when they are, they’ll represent a significant portion of the overall OLED supply. With Apple expected to transition its entire iPhone lineup to OLED panels in the next two years (and Apple is the Pied Piper of component design choices), demand is set to explode. Samsung plans to be sitting there, bucket of panels in one hand and bank account in the other.

The price tag is significant: approximately $21 billion over the next few years. The end result should be a total production capacity of 270,000 panels per month. That should be sufficient for Samsung to keep its dominance of the OLED panel market, which has obvious immediate benefits for Samsung’s displays division. But it also means that Apple will have to stay on good terms with Samsung, even as Apple’s Chinese manufacturing partner makes new moves into the display business.