Apple is reportedly looking to a new display provider, in an attempt to alleviate supply chain delays for the iPad 2 and reduce the lengthy wait times customers are experiencing. According to the Economic Daily News, Apple has roped in AU Optronics to supply the IPS 1024 x 768 displays for the iPad 2. Interestingly, the report claims that Apple has agreed to pay three to four times the current market price for each panel.
As a result, AUO has turned over half the capacity of its fifth-gen plant in Taichung for the production of the panels, in the process licensing the IPS technology from Hitachi so as to meet Apple's specification demands. Even with half the facility dedicated, that still might not mean a huge output; yields at the plant are said to reach 60- to 70-percent because Apple's requirements are so stringent.
Currently Samsung and LG Display provide Apple with iPad screens, and the decision to include AUO is also being seen as a response to growing competition in the tablet space from the rival companies. Hitachi and Toshiba, meanwhile, have been temporarily discounted due to the impact of the Japanese earthquake. There's no word when the iPad 2 stock situation is expected to be alleviated, however; online orders still suggest a 3-4 week delay in shipping.