SEOUL/TAIPEI -- U.S. tech group Google is seeking to buy curved organic light-emitting diode screens from South Korea's LG Display, sources have told the Nikkei Asian Review.
An industry source in South Korea said that LG had been in talks with Google over panel supply for a new smartphone since last year, and that the American company had offered down payments, though nothing had been decided.
Separately, David Hsieh, senior director at research group IHS Markit, said LG Display would supply to Google from the third quarter of 2017 for a new 6-inch smartphone.
"LG and Google are working together on flexible OLED display technology and LG will start churning out these panels in the third quarter in a new facility," Hsieh said.
Google has previously sourced flat OLED screens from Samsung Electronics, considered to be the global leader in the advanced display technology, for its Pixel handsets launched in the second half of last year.
But in the long run Google may face difficulties in procuring OLED panels from Samsung as the U.S. tech group is only a minor player in the global smartphone market when it comes to hardware, according to Hsieh. It is therefore natural that the American company would want to work with LG Display, a smaller rival to Samsung, to secure supply of the increasingly popular curved OLED screens.
South Korea's Electronic Times reported earlier Monday that Google offered 1 trillion won ($874 million) to help LG Display grow its flexible OLED technology. The South Korean industry source told the Nikkei Asian Review that the number was wrong, but declined to provide an exact figure.
An LG spokesman declined to comment, saying the company cannot provide information on its customers. Google did not immediately respond to an emailed request for comment.
While LG Display did supply curved OLED panels to Chinese smartphone maker Xiaomi last year, its technology still cannot quite match Samsung's, IHS Markit's Hsieh said.
Samsung is the first company to use curved OLED screens in its handsets, and a limited number of Chinese smartphone brands also began to offer products with such displays last year. Apple is set to use OLED panels from Samsung for the first time for its upcoming premium iPhone handset, which launches later this year.
According to Jeff Pu, who covers Google Pixel assembler HTC at Taipei-based Yuanta Investment Consulting, Pixel shipments totaled 1.3 million last year, including both 5-inch and 5.5-inch models.
Pu also said that Google will release at least one new Pixel model in the second half of 2017. He estimates that Google will ship around 700,000 Pixel handsets in the first half of this year, and another 2 million in the second half.
This volume is somewhat small, considering that the world's top three smartphone makers each shipped more than 100 million handsets last year, with Samsung leading the pack with 311.4 million units in 2016, according to IDC estimates.
Still, Google is a key player in the global smartphone landscape when it comes to software. In 2016, over 80% of smartphones sold ran the Android operating system developed by Google, according to tech research group Gartner.