The WSJ reports,"Sony Corp. and Panasonic Corp. are in early talks to form a joint venture in next-generation panel technology for smartphones and tablets with Japan Display Inc., a key Apple Inc. supplier, people familiar with the negotiations said Monday.
Both companies have been struggling for years to find a low-cost way to develop the organic light-emitting diode display, or OLED, technologies to make big and ultrathin televisions. Sony and Panasonic formed an alliance in 2012 to jointly develop OLED technology, but decided to call off the venture late last year.
While Sony was the first to develop and release the world's first OLED TV in 2007, Korean makers including Samsung Electronics Co. and LG Electronics Inc. have driven the OLED market, applying these screens in smartphones".
Cracking the cost formula for big OLED TVs is still a challenge for the industry as a whole, but Japanese manufacturers hope they may still have chance to compete against South Korean rivals in smaller-size panels through a three-way tie-up, one of the people said.
Japan Display, owned around 35% by a government-backed fund, is the world's biggest maker of smartphone and tablet displays and has a pilot line at its plant to develop OLED screens. Having listed its shares in March, the company itself was formed two years ago through a merger of the LCD units of Sony, Hitachi Ltd. and Toshiba Corp.
Sony and other manufacturers world-wide are increasingly focused on rolling out 4K TVs, which promise four times the resolution of existing high definition TVs and are more affordable than OLED TVs.
In a media session Monday, Sony Chief Executive Kazuo Hirai declined to comment on the reports of setting up the joint venture with Japan Display. Still, speaking generally on OLED technology, he added it made more sense for Sony to focus on offering 4K TVs to consumers considering the pricing level.
He added that Sony will continue to offer and make investments in professional OLED monitors for the film and broadcasting industries as well as for the medical field.
The Japanese electronics and entertainment giant is expecting its sixth annual loss in seven years as it ramps up restructuring of its personal computer and television businesses. The company decided earlier this year to split off its TV division into a separate, though wholly owned, unit.
The new TV subsidiary, to be launched in July, will focus on turning the business profitable after a decade of bleeding losses. If the TV division doesn't turn around, Mr. Hirai said the company may explore an outside partnership, but added a complete withdrawal from TVs wasn't "realistic" considering the costs of pulling out of such a large business.
