Are LG and Samsung giving up on OLED TV?

korean tv makers move from oled to 4k tvs vsEarlier this year at  International CES  2012, OLED (organic light-emitting diode) technology was the toast of the show. Though there were enormous 4K and 8K TVs on display and vying for the attention of attendees and press alike, it was OLED that captured the lion’s share of oohs and aahs, prompting media outlets to  tout it as the next big thing in TVs and display technology. Numerous post-show reports highlighted both LG  and Samsung’s OLED TVs as being true showstoppers. In short, OLED was one of the most discussed new technology trends at the show, and, more importantly, it had the backing of two of the largest TV makers in the world.

But that was then, and this is now. 

According to recent reports coming from NPD DisplaySearch, there has been a significant change in manufacturers’ attitudes toward OLED. Two of its biggest industry supporters, Samsung and LG, have apparently lost confidence in the organic display technology, and the future of the panels may be on thin ice – ice as thin as the über-sleek TVs themselves.

If the top two television makers in the world aren’t firmly behind the technology, what hope might it have? More importantly, what has changed the Korean TV set makers’ minds? The answer comes down to two characters: 4K.

Presently, OLED and 4K technologies are mutually exclusive,  and it appears that it is now crunch time for manufacturers to pick a pony. The tea leaves suggest the Koreans may now favor 4K over OLED.

“These are two are very distinct display technologies,” said Ben Arnold of the NPD Group. “And it is very likely that the two technologies will be in parallel development for the next five to six years. But they are not at present compatible.”

What that means is that a 4K/Ultra-HD display is unlikely to utilize OLED technology before we must endure yet another presidential election and face numerous fiscal cliffs. As Digital Trends noted earlier this year, the two technologies may be dueling for your dollars in 2013 and beyond. Perhaps TV makers have learned their lessons from past technology wars and are looking to avoid repeating past mistakes.

So why can’t the two technologies co-exist? The primary reason is cost. There are simply too few consumers willing to pony up for either OLED or 4K/Ultra HD, let alone a TV that combines both.

But there are other reasons involved as well, namely size and scale. 4K/Ultra HD is all about bigger panels with higher resolution. Making bigger TVs doesn’t seem to be a problem, nor does packing in more pixels, so 4K may have an advantage, even if the sets cost more.

Making OLED panels bigger, however, is a serious challenge – Manufacturers have have struggled to scale OLED up to 55-inches, never mind 60 – 90-inch displays. Moreover, producing OLED panels in general is pretty complicated.

In  fact, yields on OLED screens remain very poor. NPD Group estimates that fewer than 10 percent of current-generation panels produced by either Korean company passes muster to be used in TVs. Even after doctoring some failed panels up,  the final number of panels that make it to finished TV products comes in at less than 30 percent – not exactly confidence boosting figures, considering these TVs cost upwards of $10,000.

The benefits to the end-user  may not be substantial enough, either. While OLED does offer unparalleled black levels with superior contrast capabilities, many consumers are willing to settle for less performance if it means lower cost. Moreover, OLED’s other notable benefit has nothing to do with greater resolution – something 4K does offer – but simply a thinner and lighter TV.  At a point, consumers don’t care enough about form factors to justify the added expense that comes with OLED.

“We can talk about lighting and resolution, but consumers make their mind on what TV is best for them based on a few criteria,” Arnold told DigitalTrends. “It really comes down to size, brand and, really, which looks the best to them in the store. That guides the preference more than anything.”

Given that 4K/Ultra HD offers a better looking picture and will mean even larger screen sizes – both factors that consumers apparently do weigh heavily– it seems that OLED could go the way of DLP before it ever takes off. Perhaps we’ll know more after International CES 2013.