Sharp to Start Delivering iPhone 5 Displays to Apple This Month

Components for the iPhone 5 are officially in production. The news didn’t come directly from Apple, but rather from a source that’s just as credible: Takashi Okuda, the president of Sharp.

At a press briefing discussing Sharp’s second quarter financials, Okuda talked — very briefly — about supplying displays for the next-generation Apple smartphone. “Shipments will start in August,” Reuters reports him as saying. He declined to elaborate further.

August deliveries would certainly be in line with the rumored launch date of the iPhone 5. Several sources recently said that Apple plans to announce the iPhone 5 at a major press event on September 12, with a street release date of September 21st or sometime in early October.  

Sharp is one of three Japanese display manufacturers said to be supplying the iPhone 5’s display, with LG and Japan Display Inc. being the other two. Earlier reports indicated that Apple is moving to “in-cell” LCD display technology, which integrates touch sensors directly into the LCD layer of the screen, negating the need for a separate touch layer, which makes in-cell displays slightly slimmer and slightly better looking than traditional LCD displays.

A recent DigiTimes report claims that the suppliers are having a rough time reliably manufacturing the in-cell displays, however. The rumors heard by DigiTimes indicate that Japan Display’s yield is said to be the best of the bunch at just 50 percent, while Sharp’s yields reportedly started out poor and stayed poor, prompting Apple to ask the company to validate its manufacturing process once again.

All rumors should be taken with a grain of salt, but DigiTimes’ track record for accuracy leaves much to be desired, so it might be wise to take the quality reports with several shakes of salt. If true, however, low display yields could lead to shortages or even a possible delay for the iPhone 5. Sterne Agee analyst Shaw Wu thinks that will likely be the case.

“One concern we are picking up is that the new in-cell touchscreen technology could end up being the gating factor to ramping to meet demand,” he said in a report sent to us via email. “We believe what will likely happen is that iPhone will be capacity constrained due to overwhelming demand and some orders will likely spill over to the March and June 2013 quarters.”

In other words, camping out in front of your local Apple Store might just be a good idea if you want to definitely get your hands on an iPhone 5 this fall.

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