Tight iPhone 5 Supplies Linked to In-Cell Display Technology

While Apple set a company record by selling over five million units of the iPhone 5 during the device's launch weekend, it clearly could have sold even more if supplies had been available. Pre-orders for the iPhone 5 sold through the company's launch day stocks in just about an hour, and shipping estimates for new orders have been sitting at 3-4 weeks since soon after pre-orders began.

Bloomberg reports that Apple's tight supplies at launch are a result of the new in-cell technology being used for the iPhone 5's display. The technology integrates the touch sensors directly into the display rather than adding them as a separate layer, allowing for thinner displays.

Apple used the technology in the first major iPhone overhaul since 2010 to make the device more svelte, an attribute that helped lure a record 5 million buyers in three days. Yet producing in-cell screens is also more painstaking than earlier screen types, contributing to bottlenecks.

KGI Securities analyst Ming-Chi Kuo had previously noted that shifting to in-cell technology would simplify and shorten the display manufacturing process, but low yields of the new implementation have challenged Apple's supply chain partners' efforts to meet demand. Although LG and Japan Display were able to ramp up production, Sharp experienced the most significant difficulties and only began mass shipments of the display into the supply chain two weeks ago.