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Apple dependence sparks fear in suppliers

by on08 October 2014



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The sudden crash of sapphire manufacturer GT Advanced Technologies has put the fear of god amongst companies that rely too much on Apple to provide them with business. GT Advanced Technologies filed for Chapter 11 after Apple changed its mind on using its Sapphire glass technology in its new bendy and beard-snatching iPhone 6 range. 

Murata Manufacturing's chief executive has indicated his outfit is trying to move away from Apple, and Samsung in the long term. Chief Executive Tsuneo Murata told Reuters that he is not too concerned about depending on those two companies for now as they command half the smartphone market as there there's nothing bad about relying on something strong.

"If it goes bad maybe that would be a problem. But if you look at a pie chart of smartphone makers, we cover basically all of it. Even if the slices of that pie chart change it wouldn't affect us much."

However Murata's confidence is unusual among Apple suppliers, many of whom are moving to reduce their reliance on Apple hurt by the volatility of its product cycle. Murata makes ceramic capacitors, and the majority are used in smartphones, which account for around 40 percent of Murata's overall sales.

Because of their size and the fact that they do not need to be custom-designed for different phone models like display panels, Murata can more flexibly make up for a shortfall in orders from a big customer like Apple than companies that make niche or custom-made parts.

However, Sharp is one which has gone on record as saying that it is seeking to lower its dependence on Apple. Murata said he was looking to China in the long term, as its products are not affected by an increase in low-end Chinese smartphones.

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