Japanese manufacturers' global sales of televisions using organic light-emitting diodes look set to exceed 1 million for the first time next year, thanks to a partnership with LG Display that has helped drive the market's growth.

The South Korean manufacturer is solidifying plans to supply 850,000 panels to Sony and 300,000 to Panasonic in 2019, up from an estimated 500,000 and 200,000 this year. It is not rare for Japanese and South Korean companies in the electronics industry to forge close business relationships involving core components.

LG Display plans to boost its total OLED panel output by 40% to 4 million units next year, while the share going to fellow group member LG Electronics is set to drop to 50%-plus from more than 60% this year. LG Display holds a near-monopoly on the market for OLED panels for commercially available TVs.

Increased competition among makers of popular 55- and 65-inch OLED TVs is expected to bring prices down, to consumers' benefit. Euromonitor estimates that global OLED TV sales will reach 2.54 million units this year, 3.7 times the 2016 total, and nearly 10 million in 2021.

Selling more to Sony and Panasonic would be a plus for LG Display, whose OLED operations bled red ink for some time amid sluggish sales. The business finally moved into the black for the first time in the July-September quarter, but whether it will stay there remains unclear. Panel prices may decline, and LG Display needs to start recording depreciation expenses for production equipment it introduced with an eye toward supplying Apple.

Sony and Panasonic pay higher prices for OLED panels than LG Electronics does, according to a source familiar with the situation. Higher sales to the two Japanese companies would boost LG Display's profits, though Sony and Panasonic likely will eventually use their increased leverage to seek price cuts.