The current iPhone 6s Plus has a 1080p LCD, the highest among Apple’s smartphones. Android devices have moved to 2560 x 1440 LCDs in some cases, but these panels tend to be noticeably dimmer and use more power than lower resolution screens. OLED displays have the advantage here as the light is produced by the pixels themselves rather than a backlight.
An iPhone with an OLED screen would have several improvements compared to today’s LCD iPhones. The colors would be much more vibrant, for example. OLEDs also have perfect black levels and contrast because black pixels are simply off. This could allow for improved battery life in dark interfaces. OLED panels are flexible too, which has allowed Samsung and LG to sell curved smartphones.
The problem (and the reason Apple is said to be meeting with suppliers so early) is that Samsung is the only company that can produce OLED panels in significant volume. All of its high-end phones have Super AMOLED screens, which are the best displays available on a phone right now. LG is expected to expand production of OLEDs, which it has used on a handful of phones so far. Japanese display makers JD and Sharp might see their orders from Apple fall as Samsung and LG start supplying Cupertino with AMOLEDs.
Apple ships more than 200 million iPhones every year. We might see a situation where some variants of the iPhone come with OLED panels and cheaper ones still use LCD. They’ve got a few years to work out the details anyway.