Skip to Content

Apple to become Samsung's biggest customer

by Kelly Hodgkins Feb 14th 2011 at 1:00PM

A report from the Wall Street Journal suggests Apple is about to become Samsung's biggest customer in a deal estimated to be worth US$7.8 billion. As part of its purchase, Apple will be securing LCD displays, NAND flash memory and mobile chipsets from the Korean manufacturer. Each of these components will be used to build Apple's popular iPad and iPhone.

Samsung is not the only parts supplier to receive a big check from Apple. An earlier rumor from iSuppli suggests Apple has invested $3.9 billion in pre-payments to LG display, Sharp and Toshiba Mobile display for LCD technology related to its iOS devices. Instead of direct unit supplies, some of this latter investment may be used to help build out factories and increase production of LCDs for upcoming products.

In the past, securing an ample supply of NAND Flash memory was a problem for Apple and the industry at large. During the early boom of the iPhone, NAND flash memory supply was seriously constrained due to the demand of the iPhone. Both Samsung and Hynix, the #1 and #3 memory manufacturers in 2009, struggled to meet Apple's growing orders. At one point, Samsung was thought to have set aside its entire supply of NAND chips for the Cupertino company.

View Tags

Related Stories

Categories

Apple iPhone iPad

A report from the Wall Street Journal suggests Apple is about to become Samsung's biggest customer in a deal estimated to be worth US$7.8...
 

Add a Comment

Sign in »
*0 / 3000 Character Maximum Comment Moderation Enabled. Your comment will appear after it is cleared by an editor.

9 Comments

Filter by:
T

Not surpised! When I go to the Electronics section, Samsung and LG (and the newer Sonys) have the best LCD displays in town!

February 16 2011 at 10:23 AM Report abuse rate up rate down Reply
Rego

As competition heats up, I wonder how long this relationship will last in it's current form. Samsung might make more money by being a major supplier for Apple rather than a competitor.

February 14 2011 at 6:30 PM Report abuse rate up rate down Reply
punkassjim

Kelly, as near as I can tell, you use "an earlier rumor" and "this latter investment" to refer to the same thing. The way you've written it is confusing.

February 14 2011 at 2:42 PM Report abuse rate up rate down Reply
Dan Woods

This is a stable market.
Even though Samsung are competing against Apple in the retail Space (Laptops, Tablets and Smartphones), Apple still buy materials from them. No demands to stop making Galaxys in return for the Contract. Just a normal sales deal.
Microsoft should have learnt this lesson last decade.
Google and Facebook should learn it now.

February 14 2011 at 2:31 PM Report abuse rate up rate down Reply
2 replies to Dan Woods's comment
Nathan

Well considering without Samsung's manufacturing capabilities Apple production would shut down for about a year, Apple probably shouldn't be demanding Samsung around, but just happy they can both profit.

February 14 2011 at 2:59 PM Report abuse rate up rate down Reply
Dan Woods

Samsung don't have a monopoly on manufacturing, but they do have a large chunk of manufacturing. They are not trying to strong-arm Apple or artificially retard production. They are not abusing their market position.

Sony don't have a monopoly on Recorded Music, but they do have a large chunk of content. According to Sony Australia, they may be trying to strong-arm Apple by threatening to pull the Sony Catalogue from the iTunes Store in response for Sony eBook Reader being rejected. That would be abusing their market position.

Google don't have a monopoly on web advertising, but they do own a major chunk of the market. Natural Searches all seam to turn up the same top ten as Paid Ads. If this wasn't just a coincidence, that would be abusing their market position.

It's debatable whether Facebook have a Monopoly on Social Networking; they certainly have the majority of the mainstream market. Them selling the Mined Data to Dating services without the customers explicit permission is abusing their market position.

February 14 2011 at 10:13 PM Report abuse rate up rate down Reply
redcard

So, Apple owns Samsung.

Kinda.

February 14 2011 at 1:49 PM Report abuse rate up rate down Reply
1 reply to redcard's comment
aleonell.10

far from it

February 18 2011 at 7:41 AM Report abuse rate up rate down Reply
JohnnyCaraveo

Samsung is the new Sony.

February 14 2011 at 1:21 PM Report abuse rate up rate down Reply
Buy an ad here

Tweets

© 2012 AOL Inc. All Rights Reserved.