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Foxconn Seeks to Offset Slowing Apple Growth With Software and Licensed Apple Accessories
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Pegatron reportedly makes some iPhones at this factory.
Pegatron also makes iPad parts (remember the dust explosion), and might (or might not) have made some iPad 3s as well, depending on what rumor you hear.
They're supposedly hiring to make more Apple products this Fall, but no one knows if that's for cheap iPhones, iPad minis, or what. Or just a rumor.
HobeSoundDarryl
macrumors G5
Exactly. I've posted this scenario many times before. Every company wants to grow and every company observes how similar companies have grown. Samsung emulating Apple has shown that there is a lot of profit growth in evolving into a competitor of Apple rather than focusing solely on low-margin supplier. It makes great sense that Foxconn would see that same kind of opportunity and make moves in that direction.
Expect TSMC to not be that far behind. TSMC is probably already thinking about how to become the next Foxconn. By the time they are the next Foxconn, Foxconn might be the Chinese Samsung.
If you are either of them, there's only so much growth in finding more partners to supply with key parts and/or assembly work. Eventually, you have to think beyond your core, look to a competitor who has grown beyond where you are now and consider making the moves into new competencies as they have done.
Foxconn, then TSMC and then others. Little Samsungs in waiting.
Each time I share this, I get thoroughly bashed as if it just can't happen. Yet, here's one key step right in our faces. What's to stop Foxconn from deciding to try to roll their own whole products? Before someone posts that the Apple relationship is far too important to them, the same importance was perceived in the Samsung relationship. We see how that turned out. Too much additional profit in trying to be another Samsung vs. ever-tightening margins in the B2B supply business.
Apple sets a great example for the whole world in how to make just a few things and really rake in the profits. Who better to try to emulate than just such a company? Samsung has proven that emulation can lead to similar big profits. Others will follow.
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- Using noise followed by motion blur and emboss to make brushed metal
- lens flare
- layer emboss
- drop shadows galore
- rounded corners
Holy cow, I think that has every photoshop sin for logos all in the same basket.
Foxconn did get the manufacturing rights to the Kickstarted backed Nifty Drive that converts a Micro SD card to an SD card connector, but won't stick out of the side of your Mac. That may help.
TEG
TEG
You'd think that somewhere on the other side of the planet they have a secret company that pumps out cases and and accessories, all the while being able to use plausible deniability and make lots of cash.
I'd love to say that I have something intelligent to say about Foxconn's business changing by nature of its strong relationship with Apple, but I can't, so I will anyway.
Disclaimer: This comment is politically motivated by the fact that I can't, as a long-term Macrumors reader (officially registered since 2010), comment on "political, religious, ... etc." themes, because I don't drop a line of drivel every time I have one to offer, which keeps my posting rate relatively low.
OK, I will make myself a liar and comment in a way that I believe is somewhat productive by making an observation that I am sure many others have made before now: it may be all well and good that Foxconn's partnership with Apple could allow awesome accessories to come to market faster than they would if Foxconn were not Apple's creative manufacturing side-project, but there is a tremendous risk to Apple if Foxconn's understanding of trade secrecy is in any way similar to that of so many of these Pac/Asian suppliers who let technical spec data out with astonishing indifference for the well-being of their customer (in this case Apple).
This only tells me that they have saturated the market with current products to the point where sales are naturally slowing down. You can only sell me so many iPads and laptops before I get bored.., or run out of money.
Remember Apples sales are slowing and reducing on previous record sales with the same established product line. This by no means suggests to me that the end is nigh for Apple. You have perhaps also focused solely on Apples manufacturing part of it's business.
To me, it looks like they have planned ahead for this day to come, i.e iRadio, iWatch and TV.
When Foxconn loses work, its employees lose jobs.
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The $1000/share prediction was stupid. I think that Apple peaked at $700 and ought to be around $600 over time.
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Good, I'm not the only one wondering that.
Wha? TSMC Is one of the few foundries for hire (apart from global foundries, Samsung , Intel (now anyways) and a few smaller ones), whose sole expertise lies in manufacturing micro devices. In theory they could diversify, but there is absolutely no basis for assuming that they either are or have tried to. They are much more focussed on developing new processes and expanding capacity than they are anything else.
That said, the shift of manufacturers to competitors does make sense. I would imagine that Apple will find it's entire corporate strategy (vertical integration, etc.) adopted by those who have been doing the work behind the scenes, the same as occured with Samsung. Apple I think realizes this, with their development of other manufacturing facilities and even new facilities here in the US helping to mitigate the inevitable. If Foxconn competes, then giving them access to the upcoming IP is in fact dangerous. It becomes a conflict of interest.
What evidence is there to suggest that they cannot?
Sounds as naive a presumption as somebody in the last decade saying: "Why on Earth would Apple, a company who do nothing but build computers, think they can take over the music industry and make phones"
well who would they sell it to?
Marketing slogan
we may have questionable quality
but we are cheap to buy
______________________________________________
we may have questionable quality
but we are cheap to buy
This only tells me that they have saturated the market with current products to the point where sales are naturally slowing down. You can only sell me so many iPads and laptops before I get bored.., or run out of money.
So are you saying that sales are most likely to stagnate at current levels?
Simple. They can hire people who can write software. Well, that's what most companies do to get software written.
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This only tells me that they have saturated the market with current products to the point where sales are naturally slowing down. You can only sell me so many iPads and laptops before I get bored.., or run out of money.
Sales are not slowing down. Sales growth (in percentage) may be slowing down.
I company of that size almost certainly has huge group of software developers already in place wring software for internal use. In fact I'd say most software developers work for internal departments like that. They might already employ 1,000 developers who write software for all those machines and accounting and reporting.
Foxxcon might market their internal software to other manufactures not to consumers. We don't know.
What evidence is there to suggest that they cannot?
Sounds as naive a presumption as somebody in the last decade saying: "Why on Earth would Apple, a company who do nothing but build computers, think they can take over the music industry and make phones"
I wish someone would say that about TV and movie 'home video' so Apple will finally prove them wrong. I work in the industry and it drives me nuts even though I know the full score. I can't imagine how it feels for common consumers.
Yes. Look at a product that is even more popular, the refrigerator. I'd guess that more people have then then have iPhones. Once a produce because universal like that it is hard to grow the market because there is no one let to sell to (except for replacements in one breaks)
All products mature to this kind of steady state eventually.
Ah, he's from Philadelphia! No wonder I couldn't understand him.
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If Apple "screws them over", this move will have turned out to be a big mistake, since Foxconn's advantage in the Apple accessory business is their great working relationship with Apple. This move is clearly based on Foxconn's assumption that they will NOT be screwed over by Apple.