The next-generation iPad will launch in 2012, according to people familiar with developments, who have told the Wall Street Journal that Apple is adding Sharp as a maker of screens used in the popular consumer device. The overriding reason for this is Apple's determination to diversify component suppliers for its products.
Sharp's Kameyama No. 2 plant in central Japan will manufacture LCD panels for the new iPad, a source told the publication. Furthermore, the person revealed that Apple is ploughing its own money into facilities at Sharp's panel manufacturing factories in Japan, though the precise amount was not specified.
Sharp currently supplies LCD panels for Apple's iPhone smartphones and will be supplying panels for the iPhone 5, which is also expected to launch in 2012. Presently, the Japan-based company is seeking to reform its LCD panel business by increasing production of smaller panels for smartphones and tablets, rather than of larger panels for televisions.
"This would allow Sharp to count on a more stable sales volume and would help its technology gain more attention," Nobuo Kurahashi, Mizuho Investors Securities analyst, told the publication.
Apple, meanwhile, is currently locked in a series of patent disputes with rival smartphone maker Samsung Electronics, one of its biggest suppliers of LCD screens. Despite the ongoing dispute, Mr Kurahashi insisted that "it would be a stretch" to assume that Apple's choice of display panel suppliers has been influenced by its patent problems with Samsung.
The choice of Sharp and Samsung Electronics, Mr Kurahashi explained, is largely due to cost and particular technological requirements. Back in October, in fact, Lee Jae-yong, Samsung Chief Operating Officer and President, confirmed he held discussions with new Apple Chief Executive Tim Cook about extending the firm's deal to supply parts to Apple through 2013-2014.
Sharp, meanwhile, has announced that its Kameyama No. 2 plant in Mie Prefecture will soon start mass-producing smaller displays for mobile devices.
Earlier this year, IHS iSuppli, the independent research body, said that the cost of manufacturing the new iPhone 4S is $250 (£156), while the cost of producing one of the 16GB models was estimated at $196. The price rises when it comes to larger-memory alternatives, however - the 64GB iPhone 4S is valued at $245 in terms of materials.