LG Innotek is supplying chip-on-film (CoF) in large quantities to Samsung Electronics’ mid-priced smartphone Galaxy A52/72. This is the first time that LG Innotek is mass-producing and supplying tens of millions of CoFs to Samsung smartphones. The expansion of cooperation between LG and Samsung also emerged as a concern.
According to the report, LG Innotek will mass-produce and supply CoF to Samsung Galaxy A52 and A72. LG Innotek will supply CoF to the Galaxy A52 alone, and supply Stemco and Wonhwa to the Galaxy A72. Stemco is a joint venture between Japan’s Toray Industries and Samsung Electro-Mechanics.
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CoF is a film that connects a display panel glass substrate and a flexible circuit board (FPCB). A display driver IC (DDI), which is a display driving chip, is mounted on the film. The film can be rolled up or folded, making the product thinner and smaller. Product design is also free. Samsung Electronics uses CoF for its upper lineup in the mid-priced Galaxy A series.
The Galaxy A52 and A72, which LG Innotek supplies CoF, are popular models with annual total sales exceeding 30 million units. Among the two models, the Galaxy A52 sells more than the A72. LG Innotek has secured tens of millions of CoF units in both models. We can expect to supply CoF to another Galaxy A series.
In the industry, LG Innotek’s mass supply of CoF to Samsung smartphones is an exceptional case. Although there was a case where LG Innotek delivered parts to Samsung smartphones in small quantities, this is the first time that it has secured tens of millions of units.
The proportion of CoF for Samsung smartphones in LG Innotek’s sales right now is not expected to be large. CoF prices are known to be around 300-400 won per piece. If LG Innotek supplies tens of millions of CoFs for the Galaxy A52 and A72, sales of around 10 billion won can be expected. Compared to last year’s LG Innotek sales of 9.4 trillion won, it is 0.1%.
However, as Samsung Electronics is focusing on the mid-priced smartphone market due to sluggish flagship smartphone sales, the proportion of LG Innotek may also increase. Stemco, which dominates the Samsung smartphone CoF market, has a stake in Samsung Electro-Mechanics (30%), but the largest shareholder is Japan’s Toray Industries (70%). In the long term, the expansion of cooperation between Samsung and ‘New LG’ by LG CEO Kwang-mo Gu, who took office in 2018, is also an expected factor.
Meanwhile, the method of mounting the driver IC on the display panel substrate is divided into CoF, Chip on Plastic (CoP), and Chip on Glass (CoG) methods according to the type of substrate or attachment method. The mounting location of the driver IC and the connection type between the display panel board and the FPCB are different.
Samsung’s flagship smartphone uses a CoP method in which a chip is mounted on a polyimide (PI) substrate of a flexible organic light-emitting diode (OLED). The sub-lineup of the Galaxy A series and the low-cost Galaxy M series use a CoG method that mounts chips on a glass substrate.
