chip is mounted
in a housing which provides mechanical stability, electrical
focuses the light. It also dissipates the heat generated in the chip.
This housing is called packaging.
There are different ways of packaging an LED chip:
The chip is glued into a small pan connected to the - lead, a bonding wire connects to the + lead. The complete assembly is molded into a transparent plastic which holds the leads in place.
Since the heat is transferred via the - lead,
packaging is only suitable for low power LEDs.
For lighting LEDs it would operate near the thermal limits of the chip. The first generation of LED lights used this packaging - resulting in low lifetime