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Friday, 17 May 2013 09:03

Samsung cuts Apple’s supply lines

Written by Nick Farrell



Needs help

Samsung is finding that its in-house supply lines are stretched and it is having to courting some of Apple's main parts suppliers. The advantage is that such a move take some of the parts supply away from Jobs’s Mob as it prepares for its next product line-up.

With Samsung as their client suppliers can tell Apple to go forth and multiply when it tries to bully suppliers into accepting cheaper deals which have kept its prices lower. Samsung's has a huge supply chain, providing parts from displays and powerful processors to memory chips and batteries. Lee Sun-tae, an analyst at NH Investment & Securities told Reuters that the next round of the post-patent battle between Samsung and Apple will be over component supplies.

"Who wins access to the best performing components in class in large quantity - that's the key ... and explains why Samsung is shopping for components more than ever," he said.

Samsung has been wooing Apple partners like Sharp and SK Hynix. Samsung, which buys most of its mobile screens from its Samsung Display unit. Last year it placed orders with Sharp for high-resolution LCD screens for its popular Galaxy range of products, though it later cancelled the order.

Sharp, in which Samsung bought a 3 percent stake earlier this year for $110 million, said this week it was seeking to boost sales to the Korean firm. Samsung is also using more chips made by Qualcomm, another major Apple supplier, in its flagship Galaxy S.

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