Apple to Samsung
Sorry to inform you but we have ordered parts from other companies WHO DON'T Steal from US!
kamsahamnida!
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Samsung Working to Keep Design Dispute Separate from Component Contracts
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Apple to Samsung
Sorry to inform you but we have ordered parts from other companies WHO DON'T Steal from US!
kamsahamnida!
At this point, I wouldn't be surprised if Apple just bought Samsung's manufacturing division and ran it themselves.
I posted about this yesterday. See link below.
https://forums.macrumors.com/showthread.php?p=15533157#post15533157
$$$$ should trump emotions in business.
https://forums.macrumors.com/showthread.php?p=15533157#post15533157
$$$$ should trump emotions in business.
Strategy #1,
Close down, sell off all our assets, then use the money to pay back investors.
Samsung's profits in the last year were I believe somewhere in the 4.5 Billion off of something like 50 million in revenue.
yes 1 billion hurts.
Shut down and sell assets? not likely
Some general info that people might find useful. When MacRumors discusses "Samsung" they are talking about the subsidiary Samsung Electronics.
According to their 2011 FY results, they had revenues of 165 trillion won. (~148 billion USD) 22% of that was from semiconductors, and 33% from their telecomunications division, which includes all phones and tablets. I guess the rest is TVs, cameras, appliances, etc, but semiconductors and telecommunications were the only ones that were specifically broken out.
Samsung is getting billions of dollars from Apple...
Copy Apple design/infringe patents = stupid.
Stop comportment contracts = no one could be that stupid.
Good thing Samsung has a bit of idea where its going now.
Copy Apple design/infringe patents = stupid.
Stop comportment contracts = no one could be that stupid.
Good thing Samsung has a bit of idea where its going now.
Was the exclusivity to get AT&T to meet their terms? To get them to agree to their subsidized prices? If so, you have to ask whether it's really about market share or profit per device and controlling your ecosystem.
Still, it's hard to have a "worst decision" for a profit machine like the iPhone.
How was it the worst decision ever? Actually, it was a pretty darn good business decision. From what I understand, AT&T were the only ones who gave in to Apple's demand to allow them to have full control of the Software on the phone, and to pay Apple the subsidy they demanded for each sale. Ended up being a HUGE hit for Apple. Also, the limited supply (being only on AT&T) increased demand for the phone... and rest is history. Apple believed in the product and wouldn't bend. And few would argue that the iPhone is a major reason Apple is the most valuable company in the world today.
One billion would be a good start at upgrading a Samsung competitors screen manufacturing capability. I can see Apple going to LG, spending a ton of cash to increase the quality and quantity of their output, decrease the cost per unit, in exchange for a big chunk of the business and a lock on a percentage of their production.
Push the quality and price of LG to the point where Samsung can't compete, then remove one of their top customers. Next, Apple should move into the TV business, destroying Samsung's market share, and taking a big chunk out of their income.
I know Apple likes to stay away from the low margin high volume markets, but completely destroying a company that tried to put a dagger in your back has a quality of it's own.
If you can push the quality of Samsung's competitors products, you can destroy Samsung's reputation. Samsung, the next Xerox.
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Paraphrasing the Dell quote. (From memory, so I know I got it a bit wrong.)
Push the quality and price of LG to the point where Samsung can't compete, then remove one of their top customers. Next, Apple should move into the TV business, destroying Samsung's market share, and taking a big chunk out of their income.
I know Apple likes to stay away from the low margin high volume markets, but completely destroying a company that tried to put a dagger in your back has a quality of it's own.
If you can push the quality of Samsung's competitors products, you can destroy Samsung's reputation. Samsung, the next Xerox.
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Paraphrasing the Dell quote. (From memory, so I know I got it a bit wrong.)
I'm excited about all this! Samsung's touch wiz android skin was the problem... This will hopefully have android handset manufacturers stop using custom skins... and just use vanilla android since google would be on top of things that might challenge apples patents....
As for people saying prices will go up bla bla.... they order the parts in advance in large amounts at prices that are competitive... if samsung raised the parts prices, a competitor would step in and offer a better price..... apple is always looking for the best parts at the best prices....
As for people saying prices will go up bla bla.... they order the parts in advance in large amounts at prices that are competitive... if samsung raised the parts prices, a competitor would step in and offer a better price..... apple is always looking for the best parts at the best prices....
Don't take this the wrong way, your numbers are a bit wonky.
To put it simply, revenue is how much you bring in. Profit is how much of that, you get to keep, after you subtract all your expenses.
It's like saying, I earned 100 dollars, however, after subtracting all my expenses, I got to keep $1,000,000,000 out of the $100.
I think the Samsung CEO is smart enough to know that is company is much more than just cell phones. If it disrupted anything with supplying parts to Apple, it would be sending a bad message to all its other customers.
I hope Apple lets all of their contracts with samsung expire and they create new contracts with other companies as the article mentions. We need creativity and innovation in this world and Samsung failed to do that.
Translation: They both like making money. Go figure
Don't we all like making money? "Money makes the world go-round." Apple and Samsung are no different than any one of us in this respect.
I know exactly what Revenue and profit are
I might not have worded my post very well (heads a bit muddled today from concussion).
I'm just saying that out of something like 4.5 Billion PROFIT, 1 billion hurts it, But hardly sends Samsung scraping for funds.
First - When the original iPhone was introduced, no discounts were available. Customers paid full price-up to $599 for the 8GB model.
So there were no subsidies.
Second - There's a difference between short term and long term business decisions. Short term - it might have been a great one. Long term, and without the knowledge details of Android's business plan could change that to a not-so-good-business decision as pointed out by KDarling as others as it allowed Android to get a strong footholding.
When the iPhone first came out, it wasn't subsidized. At least, not in the normal manner at up front sale time.
Apple initially sold the phone at a high price for a nice profit, and then ALSO took a monthly fee for each customer... money which usually was put aside for a subsidy for the customer. Basically, Apple was double dipping at the expense of the user.
That business model couldn't last, however. Partly because Apple had to radically drop the price to keep selling, and partly because so many phones were ending up on other networks that didn't pay the monthly fee.
But I digress. The exclusivity came about because, by mid 2006, Apple had no big carrier partner yet. Verizon had been turning them down starting back in mid 2005 (understandable with no product to see), and AT&T (Cingular) had made no move either, even though they had known about Apple's phone plans since early 2005.
So AT&T (Cingular) was in the driver's seat in many ways. It was no extra skin off their back to give the customer subsidy to Apple on a monthly basis, and they didn't have the thriving app/ringtone business that Verizon did at the time. So they basically gave up nothing in return for Apple agreeing to a long exclusivity. It was win-win for AT&T.
As Cingular put it right after the iPhone was shown off, and Jobs got on their nerves by claiming to have dictated to a carrier:
Yeah, but think how different things might be if Apple hadn't given Android four years of total freedom from competition in over half the US market.
Suppliers only need to be innovative and creative enough to provide the best quality, price, and delivery. If any other supplier could beat what Samsung provides, I'm sure Apple would switch.
For those of you wishing Apple would stop buying from Samsung, how does that impact you one way or the other?
KDarling -
Also interesting to note (at least this is what I've heard from ATT management) is that unlike any other phone manufacturer - Apple put in their contract that ATT would NOT be able to offer early upgrades to their users unless they (Apple) sanctioned it.
Which means - that if you bought/buy (and the rule still applies) and iPhone - you aren't eligible for subsidized pricing on that plan for the full length of the contract unless Apple give ATT permission (IE - they have a new phone and want to encourage adoption). That locks people into an ecosystem.
Conversely - the managers I spoke with stated - if you own an Android or other device, ATT would offer you an early upgrade to any other phone (including iPhone) as early as 6 months depending on the reason, plan rate, etc.
So Apple negotiated exclusivity on a few levels.
Also interesting to note (at least this is what I've heard from ATT management) is that unlike any other phone manufacturer - Apple put in their contract that ATT would NOT be able to offer early upgrades to their users unless they (Apple) sanctioned it.
Which means - that if you bought/buy (and the rule still applies) and iPhone - you aren't eligible for subsidized pricing on that plan for the full length of the contract unless Apple give ATT permission (IE - they have a new phone and want to encourage adoption). That locks people into an ecosystem.
Conversely - the managers I spoke with stated - if you own an Android or other device, ATT would offer you an early upgrade to any other phone (including iPhone) as early as 6 months depending on the reason, plan rate, etc.
So Apple negotiated exclusivity on a few levels.
Geeze, I guess we were not thinking about the 7 Billion in orders while we were lying, and bringing great Shame to our Nation.
Time for discount pricing Tim.
Time for discount pricing Tim.
Who here doesn't already think that Samsung has already put at risk its Apple supply contract? 
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Some people make it sound like leaving Samsung is easy.
You think Tim Cook and his team haven't looked around and assessed this business decision? Samsung has been in that industry for years, and the fact that Apple chose them says A LOT about their quality, pricing, product, execution, etc. Think about that for a second. Steve Jobs is one hell of a perfectionist. He wouldn't have chosen just any company to work with. He chose Samsung.
So geniuses, who should Apple look to then after eliminating all the **** manufacturers? Samsung's manufacturing department didn't get up there by producing terrible quality products.
You think Tim Cook and his team haven't looked around and assessed this business decision? Samsung has been in that industry for years, and the fact that Apple chose them says A LOT about their quality, pricing, product, execution, etc. Think about that for a second. Steve Jobs is one hell of a perfectionist. He wouldn't have chosen just any company to work with. He chose Samsung.
So geniuses, who should Apple look to then after eliminating all the **** manufacturers? Samsung's manufacturing department didn't get up there by producing terrible quality products.