Samsung’s Strategic Shift: Exiting LED Backlight Production
Recent reports suggest that Samsung is planning to shut down its in-house LED backlight production business, which includes the backlights used in its Neo QLED (Mini LED) and QLED TVs1. This move follows Samsung’s cessation of LCD panel production in 2022, leading to recent Neo QLED, QLED, and LCD TVs combining panels from other manufacturers with in-house produced LED backlights2. If these reports are accurate, future models may feature no Samsung-manufactured elements in their displays3.
While outsourcing components is common among TV manufacturers, this shift is significant given Samsung’s pioneering role and strong advocacy for Mini LED technology.
Samsung has long promoted its Neo QLED TVs as rivals to top-tier OLED sets, making this refocus unexpected4.
Competitor Advances and Market Dynamics
In contrast, Sony has advanced its Mini LED screen technology, launching the Bravia 9 TV with an in-house developed Mini LED backlighting system. Sony’s commitment to Mini LED tech is clear, with only one new OLED TV launched this year. Meanwhile, Samsung’s exit from LED production, which generates approximately 2 trillion won annually in South Korea, marks a strategic pivot.
A roadmap suggests Samsung will cease LED chip production for lighting by mid-2026 and exit the TV backlighting business by late 2026. The company will continue producing automotive LED components until potentially 2030. However, these claims are still unofficial until confirmed by Samsung.
Future Focus: QD-OLED and Micro LED
Despite these changes, Samsung will continue producing QD-OLED panels in-house, featured in models like the Samsung S95D and Sony A95L. These Quantum Dot-imbued OLED panels are known for their enhanced brightness, showing Samsung’s ongoing commitment to this technology.
Additionally, Samsung will focus on Micro LED development and production. Although commercially practical Micro LED products are still awaited, this shift could signal Samsung’s future direction in display technology.
Embracing the XXL TV Trend
To regain market share from competitors like TCL, Samsung plans to embrace the “XXL TV” trend. TCL and Hisense have seen success with their super-sized 100-inch and larger TVs, and Samsung aims to launch its extra-large TVs next year.
In summary, while Samsung’s exit from LED backlight production marks a significant shift, its continued focus on QD-OLED and Micro LED technologies, along with the introduction of XXL TVs, highlights its strategic adaptation to evolving market dynamics.
Samsung’s decision to exit in-house LED backlight production could have several implications for TV pricing:
- Increased Production Costs: With Samsung sourcing LED backlights from external suppliers, production costs might rise. This could lead to higher prices for consumers as Samsung adjusts to the new supply chain dynamics.
- Competitive Market Dynamics: As Samsung focuses on QD-OLED and Micro LED technologies, competitors like Sony, which continues to advance its Mini LED technology, might offer more competitive pricing to attract customers.
- Premium Pricing for Advanced Technologies: Samsung’s investment in QD-OLED and Micro LED technologies suggests these models will be premium products. The advanced features and superior performance of these technologies could justify higher price points.
- XXL TV Trend: Samsung’s entry into the “XXL TV” market with super-sized models could also influence pricing. These larger TVs are typically priced higher due to their size and the advanced technology needed to maintain picture quality.
Overall, while there might be some upward pressure on prices due to increased production costs and the premium nature of modern technologies, the competitive landscape and consumer demand will play significant roles in deciding final pricing.
