Apple (NASDAQ: AAPL) plans on using sapphire for the screen of its larger iPhone as well as its rumored smart watch, according to a Wall Street Journal article.
The report, citing unnamed sources, said that Apple is having the screens produced at a facility this month in Mesa, Ariz., that Apple opened with materials manufacturer GT Advanced Technologies. Apple is reportedly gearing up for a Sept. 9 event to announce the next iPhone, dubbed the iPhone 6, and likely a wearable device that many believe will be called the iWatch.
The report said Apple is considering using sapphire screens in "more expensive models of the two new, larger iPhones" it plans to release this fall, if it can get enough of the material. It's unclear what that means though. Reports have indicated that Apple plans to announce to new models of the iPhone, one with a 4.7-inch screen and one with a 5.5-inch display. Apple also makes iPhones with more internal memory more expensive. So it's unclear if the sapphire screen is destined for the 5.5-inch iPhone, which presumably will be more expensive, or high-memory variants of both new iPhone models.
Apple and GT declined to comment, the report said.
Rumors that Apple would incorporate sapphire into its device screens have been circulating since Apple last year bought the 1.4-million-square-foot Arizona facility from a solar-panel producer for $113 million and leased it to GT, one of the leading sapphire manufacturers in the world. As the Journal notes, in November, Apple agreed to prepay GT $578 million to update the furnaces in the factory used to make synthetic sapphire, and GT is operating the factory to produce sapphire exclusively for Apple.
Synthetic sapphire is designed to mimic the properties of naturally occurring sapphire, one of the hardest minerals on earth. Sapphire screens do not crack or scratch as easily as glass. Up until now, Apple has used Corning's super-tough Gorilla Glass for its iPhone screens, and Corning has been able to mass-produce millions of screens on short notice.
It's unclear if Apple and GT can mass-produce sapphire screens to meet the expected demand for Apple's new iPhone. Apple has reportedly asked its suppliers to produce between 70 million and 80 million units of the next iPhone by Dec. 30, according to a separate Journal report last month. That volume would represent the largest ever for an iPhone launch.
Further, some financial analysts expect Apple to charge more for the phones than previous new models, perhaps because of higher component costs like sapphire screens. Apple could save money on warranty costs if sapphire screens lead to fewer shattered phones, but Bernstein Research analyst Toni Sacconaghi told the Journal those savings likely wouldn't offset sapphire's higher cost. If Apple maintains its pricing but has higher costs its margins could suffer, but Apple might be willing to deal with that to set its new products apart from the competition, Matt Margolis, an analyst at PTT Research and a GT investor, told the Journal.
As Re/code recently explained, sapphires used in jewelry contain trace elements of other materials like copper, magnesium or iron that are mixed with the mineral corundum, and that produces a blue color or another tint, like purple or yellow. However, synthetic sapphire comes out clear because there are no impurities introduced in the manufacturing process.
Other device makers have introduced sapphire screens. Verizon Wireless (NYSE: VZ) recently launched the ruggedized Kyocera Brigadier with what Kyocera calls a sapphire shield, rendering the phone nearly scratchproof, according to Kyocera. The Brigadier costs $100 with a two-year contract and after a $50 mail-in rebate. Luxury smartphone maker Vertu also makes smartphones with sapphire displays but those phones cost thousands of dollars, Re/code noted.
- see this WSJ article (sub. req.)
- see this The Verge article
- see this Re/code article
Report: Apple to unveil iPhone 6 on Sept. 9
T-Mobile's Legere sees 'huge opportunity' to attract switchers with iPhone 6 launch
Apple iPhone 6 will support VoLTE, says Mavenir's CEO
Report: Apple planning for 70-80M units of larger iPhone 6
As bigger iPhones head to production, survey finds 40% of Americans want a phablet
Apple's iPhone 6: Bigger screen may prompt more data consumption