With the expected debut of Apple’s (NASDAQ:AAPL) next-generation iPhone only about two months away, there is still plenty of debate over what features and components will be included in the so-called iPhone 6. Perhaps the only iPhone 6 rumor that is not widely disputed is the expectation that Apple will unveil two models with larger screen sizes of 4.7 inches and 5.5 inches. The screen size upgrades have been reported by multiple media outlets and several leaked images of display components for both screen sizes appear to confirm this rumor. Most industry watchers are treating the rumor about the devices’ increased screen sizes as a confirmed fact, as well as the expectation that Apple will include typical incremental hardware upgrades, such as the next-generation A8 processor.
Excluding rumors about screen sizes or usual hardware upgrades, it seems that most of the other rumors about the iPhone 6 are still up for debate, including everything from the launch dates to the possible inclusion of Near Field Communications (NFC) technology. However, when it comes to speculation about the iPhone 6, the rumors related to Apple’s sapphire plans may have the least amount of consensus among industry watchers.
Sapphire is an extremely hard and scratch-resistant material that Apple currently uses as a protective covering for the Touch ID fingerprint scanner and the iPhone’s camera lens. However, it appears that Apple is planning on greatly expanding its use of this material. Last year, GT Advanced Technologies (NASDAQ:GTAT) revealed in its quarterly earnings report that the iPhone maker had made a $578 million investment in a sapphire manufacturing facility that it runs in Arizona. More recently, an amended 10-Q filing that GT Advanced Technologies made last month revealed that the company had also dedicated a second plant located in Salem, Massachusetts, to manufacturing sapphire for Apple.
While both filings suggest that Apple has plans to use sapphire for more than just protective coverings for individual iPhone components, analysts are divided over the extent of the company’s sapphire ambitions. On one side of the debate is PTT Research analyst Matt Margolis, who has done extensive investigative research on Apple’s partnership with GT Advanced Technologies. Based on information he has gleaned from import/export documents and regulatory filings, Margolis believes that Apple will easily be able to produce enough sapphire to provide display covers for the 4.7-inch and the 5.5-inch iPhone models, as well as the iWatch. As noted by Margolis via Seeking Alpha, “the maximum sapphire screen capacity of the Mesa facility is likely to exceed 200m annual units.”
On the other hand, there are several prominent analysts who believe that Apple will introduce sapphire covers in a much more limited way. KGI Securities analyst Ming Chi-Kuo — who has a good track record when it comes to predicting details about Apple’s future products — released a research note in April that argued that the sapphire screen covers would only implemented in the high-end iPhone 6 models, such as the 64GB 5.5-inch iPhone 6, according to MacRumors.
NPD DisplaySearch analyst Brian Huh has also disputed Margolis’s claims. “Apple’s sapphire material supplier, GT Advanced Technologies, appears capable of producing the glass for around 45 million smartphones,” said Huh, according to The Korea Herald. “Still, only the iPhone 6’s most premium models may adopt it due to its high cost and a possible supply (set aside) for the iWatch.” Interestingly, despite his assertions about the high cost and limited supplies of sapphire, Huh also predicted that Apple may start using the material in its laptops next year.
Another research note released by J.P. Morgan this week similarly argued that sapphire displays would be used only for Apple’s high-end models. “Sapphire covers will also be restricted to high-end iPhones, possibly the 128GB ones,” wrote the research firm in a note obtained by Taipei Times. However, J.P. Morgan predicted even fewer sapphire covers than NPD DisplaySearch, with an estimated production of only 10 million sapphire covers this year.
“Due to various challenges related to the new cover material, we believe the production output for sapphire covers will be low,” noted J.P. Morgan via Taipei Times. “Sapphire ingot yield rates could be as low as below 50 percent for this size, and finished sapphire smartphone covers may cost as much as US$40 to US$45 versus below US$10 for finished Gorilla glass.” Gorilla Glass is the proprietary display cover material made by Corning (NYSE:GLW) that is currently used in Apple’s mobile devices.
J.P. Morgan also predicted that Apple would similarly restrict the use of sapphire for its various iWatch models. Not surprisingly, despite reaching some very different conclusions, all of the analysts claimed to have based their predictions on supply chain research and/or contacts with sapphire manufacturers such as GT Advanced Technologies.
Meanwhile, the debate was further complicated when multiple videos showing what was purported to be a sapphire cover for the 4.7-inch iPhone 6 were posted online earlier this month. Although initial tests showed the screen withstanding an amazing amount of abuse without developing any cracks or other visible damage, a follow-up stress test performed by researcher Marques Brownlee that used garnet sandpaper was able to scratch the purported iPhone 6 screen. As explained by Brownlee in the video above, garnet would not be able to scratch pure sapphire since it is lower on the Mohs hardness scale. While it is still not known if the cover is a genuine Apple part, it is also possible that Apple has developed a composite material that resists scratches better than Gorilla Glass, but not as well as pure sapphire. As noted by Brownlee, Apple already has a patent titled, “Sapphire Laminates,” which described a method for fusing sapphire together with other materials.
While it is unlikely that the many analysts who have weighed in on the sapphire issue will reach a consensus about Apple’s plans for this material before the release of the iPhone 6, there is no question that the company’s investment in sapphire has already attracted the attention of rival smartphone makers. According to a report from Korea’s ETNews, both Samsung (SSNLF.PK) and LG are reexamining the use of sapphire after initially rejecting the material as too expensive last year.
Japanese electronics manufacturer Kyocera (NYSE:KYO) has already announced plans for a smartphone with a “Sapphire Shield” in a recently released video that can be seen above. While it’s unknown if Kyocera already had plans for a sapphire-covered smartphone before the rumors of Apple’s sapphire iPhone 6 emerged, Kyocera’s promotional video for the product kicks off by noting, “You’ve heard the buzz about Apple using a sapphire display on the upcoming iPhone 6.”
Apple fans will find out more about the Cupertino-based company’s sapphire ambitions after the 4.7-inch iPhone 6 makes its rumored debut sometime in September.
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