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Apple moving away from Samsung memory components

by Chris Rawson Sep 22nd 2011 at 10:00AM

Apple has allegedly already switched away from Samsung for production of the next-gen A6 processor for iOS devices, and if the latest report from Digitimes is accurate, Apple's also diversifying its sources for DRAM and NAND memory. Digitimes' sources claim that Apple is now starting to source NAND memory from Toshiba and mobile RAM from Elpida.

Currently, a fairly large proportion of the internal components of iPhones and iPads are actually manufactured by Samsung. Considering the much-publicized global patent spats between the two companies, this puts Apple in a potentially awkward position. It makes good business sense for Apple to start sourcing components from the few tech companies on Earth that haven't filed lawsuits against it (yet).

MacRumors points out that Samsung's currently contracted for US$7.8 billion in parts over 2011, including the A5 processor that powers the iPad 2. Although Samsung is the world's largest supplier of many electronic components, losing Apple's business will likely put a very large dent in the Korean tech giant's ledger.



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Apple has allegedly already switched away from Samsung for production of the next-gen A6 processor for iOS devices, and if the latest...
 

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16 Comments

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Bernie -

samsung most likely has run through this scenario many time when they decide to pick the fight with apple. still, this is a big gamble for them.

September 22 2011 at 10:38 PM Report abuse +1 rate up rate down Reply
Buzz Mega

Well, duh.

Samsung's thinking seems to have been along the lines of "We got this tremendous order for billions of dollars worth of stuff from Apple. I guess that means it's okay to mimic their products willy-nilly!"

Guess again.

September 22 2011 at 6:32 PM Report abuse +1 rate up rate down Reply
mguniverse

Oh wait, i'm a moron. Nevermind.

September 22 2011 at 4:59 PM Report abuse rate up rate down Reply
mguniverse

Apple owns their own processor manufacturer for the A chips. >.>

September 22 2011 at 4:57 PM Report abuse rate up rate down Reply
Actionable Mango

It has been repeatedly reported that one of Apple's serious advantages is to buy so many components from their suppliers that little to none are left for Apple's competitors.

So if Apple walks away from Samsung, then Samsung's entire capacity is now available to Apple's competitors. So either that serious advantage is lost, or it wasn't real in the first place.

September 22 2011 at 12:43 PM Report abuse rate up rate down Reply
slembcke

Let me fix that for you:
"It makes good business sense for Apple to start sourcing components from companies that it hasn't filed lawsuits against."

September 22 2011 at 10:53 AM Report abuse +2 rate up rate down Reply
1 reply to slembcke's comment
Daniel

Well, as sue happy as Apple is these days, it's only a matter of time before Apple sues Toshiba over their tablet. Then what are they going to do for parts?

September 22 2011 at 11:20 AM Report abuse -1 rate up rate down Reply
1 reply to Daniel's comment
Mabhatter

Um... Here's a $10 billion dollar contract for parts? Do you really need a tablet?

Samsung was propped up the whole recession because they had that fat Apple contract in their pocket '07 and on it just kept getting bigger. Samsung is crazy... Look at the iPod + iPhone pie. Almost all the expensive parts come from Samsung... they had ALL Apple's biz and a little of their own.

I can understand why Steve and Tim are furious. All the cool things Apple engineers have been trying to get Samsung "parts" division to make are ending up in Samsung's Android phones... While Apple is paying for premium access to production. I think a big deal that will come out in patent suits is the lack of a "Chinese wall" between business units... And the chiefs at Samsung not willing to enforce them to protect their customer relationship.

Samsung is South Korea's baby... "too big to fail" so locally they are probably getting hi-fives all around for snubbing Apple. Too bad this knocks the business relationship credibility of the whole Asian tech industry back about 10 years...

September 22 2011 at 5:45 PM Report abuse +1 rate up rate down
Elranzer

Samsung is better off. Apple needs Samsung's parts more than Samsung needs Apple as a buyer.

So Apple is going with Toshiba parts? Looks like the iPhone 6 is going to be a downgrade.

September 22 2011 at 10:47 AM Report abuse -1 rate up rate down Reply
1 reply to Elranzer's comment
thanatos

Apple was Samsung's largest customer by a large margin.

September 22 2011 at 11:10 AM Report abuse +1 rate up rate down Reply
1 reply to thanatos's comment
John Johnson

No. Sony is 2nd largest for Samsung Electronics. Not by a large margin.

September 23 2011 at 2:42 PM Report abuse -1 rate up rate down
Andrew Fong

@icfantv No large tech company would agree to that without a reciprocal agreement that Apple not sue. I'm pretty sure Apple sued first too, so the inability to counter-sue puts the other side at a huge disadvantage.

September 22 2011 at 10:40 AM Report abuse -1 rate up rate down Reply
bk

samsung stands to lose 10 billion $/year from this reluctance to accept their behavior is wrong. Poor leadership. They continue while others would accept defeat. Reminds me of some other Asian nation 55 years ago.

September 22 2011 at 10:37 AM Report abuse -2 rate up rate down Reply
1 reply to bk's comment
Rorsemp

I rarely see as racist a comment as this one. However, I'll let it slide and just would like to point out their behavior is not WRONG. They are producing competition in a Marketplace currently predominantly owned by Apple.

September 22 2011 at 5:31 PM Report abuse -1 rate up rate down Reply
icfantv

so two things: 1) apple is essentially financing Samsung's lawsuit against it. 2) why don't they make the sales contract stipulate that the company waives all rights to sue over patent disputes or at the very least commit to binding arbitration or mediation. it'd be astronomically cheaper for both companies.

companies are suing apple because they continue to hemorrhage market share to apple. apple sues because these companies are incapable of coming up with a shiny new product on their own, so they copy apple's design.

September 22 2011 at 10:20 AM Report abuse +3 rate up rate down Reply
1 reply to icfantv's comment
John Johnson

Ever heard of GS2?

September 23 2011 at 2:43 PM Report abuse rate up rate down Reply
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