Organic Light Emitting Diode -any light emitting diode (LED) whose emissive electroluminescent layer is composed of a film of organic compounds. The layer usually contains a polymer substance that allows suitable organic compounds to be deposited. They are deposited in rows and columns onto a flat carrier by a simple "printing" process. The resulting matrix of pixels can emit light of different colors.
That would be the technical definition but basically it is the future. Right now it's biggest drawback is the poor performance when used outdoors. On the current phones with OLED people complain because it is so bad and I think that right there is why Apple won't use it.
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