Samsung's Exclusive Contract for iOS Device Chips Expiring in June as A7 for iPhone 6 Heads to TSMC?

[Wicked1]

In business it makes logical sense for Apple to partner with someone it is not seeking $1.05 Billion from?

I am sure Samsung will hurt a little but they will find another way to make that money up.

 

[fourthtunz]

You can contend that, but it isn't what happened.

" ... story of Windows dates back to September 1981, when Chase Bishop, a computer scientist, designed the first model of an electronic device and project "Interface Manager" was started. It was announced in November 1983 (after the Apple Lisa, but before the Macintosh) under the name "Windows", but Windows 1.0 was not released until November 1985. ... "
http://en.wikipedia.org/wiki/Microsoft_Windows#Early_versions

Did it look alot like the Xerox PARC GUI ? No. It is a bunch of revisionist history though that only Apple was aware of the kinds of interfaces being developed at PARC and other research labs at the time.

1989 is really Windows 3.0 and yes that is what "took off" in the Marketplace to outpace the Mac as being the more widely used GUI.

1989-1990 was where IBM and Microsoft broke up. OS/2 also started well before 1989

" ... The development of OS/2 began when IBM and Microsoft signed the "Joint Development Agreement" in August 1985.[3][4] It was code-named "CP/DOS" and it took two years for the first product to be delivered. ... "
http://en.wikipedia.org/wiki/OS/2#1985-1988:_Enthusiastic_beginnings

Microsoft gained leverage with Word/Excel on Mac OS in the transition to Windows 3.0 in part because the other Application providers let Microsoft largely have the Mac OS base without as much competition. Most of them were not beating heavily on every horse in the race ( DOS, Windows, OS/2, and Mac OS ). Certainly Microsoft knew somewhat in advance that they were going to pull the rug out from under OS/2.

Don't believe everything you read on wikipedia ;(

 

[samcraig]

But it's not just screens, chips, and CPUs. It's all of that plus even more intimate details. There's quantities and delivery dates. There's screen sizes and resolutions. There's also special features that apple may ask for that could provide a glimpse into apple's plans.

For instance, if Samsung got an order for a super small CPU/GPU, plus an order for a high resolution 2.5" square screen, wouldn't that pint to an upcoming smartwatch? And knowing Apple's cost for these two components could give Samsung insight into what apple would price this smartwatch at. Samsung would also be privy to Apple's expected quantities and release date. All of these things can be gleaned from knowing these intimate details.

It's too much to expect Samsung to keep firewalls up between their component and mobile divisions, so Apple is making plans to separate themselves from a super who also happens to be a competitor. It's a business decision and ultimately the wisdom behind the move will play out over the next couple of years.

Oh, and obviously, the OP meant iOS device roadmap, not the actual roadmap for the iOS software. Samsung has nothing to do with the software and supplying components to Apple wouldn't give them any edge on the OS front b

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oh, you mean the octa-core chip that they can't supply enough of to put into all S4's? They have to go with Qcom's 4-core chip for some pretty big markets, USA included.

Disclaimer - I do realize that the decision to go with the Snapdragon has much to do with the markets that have high penetration of LTE coverage. But still, it looks bad when many of the big markets get the "crappy" chip on the next big thing.

I'd think that being a both a competitor in the same market and a manufacturer themselves, Samsung would be well aware of the cost and availability of all these components. The only hint they'd get from a list of parts would be that they'd know Apple was building a smartwatch a few months ahead of everyone else.

and if the smartwatch is the next big thing, wouldn't a three month head start be something worth protecting?

Now, I'm no futurist and I have no real idea as to what the next big thing is, but if Apple does indeed have something big and new planned, it's in their best interest to keep any and all information out of their competitor's hands. Unless Samsung is the only supplier of a critical part, get it from someone that poses no competitive threat. Would McDonalds ever source a key ingredient to their newest culinary product from a processing faculty owned by Burger King? Of course not, and neither should Apple.

No imagine this -

Imagine that Apple orders parts for several projects they are working on and the parts aren't related.

Again - just because I buy milk, sugar and butter doesn't mean I'm baking a cake.

 

[fourthtunz]

No imagine this -

Imagine that Apple orders parts for several projects they are working on and the parts aren't related.

Again - just because I buy milk, sugar and butter doesn't mean I'm baking a cake.

Well it's not as simple as those items you mentioned.
We have no way of knowing what information Apple provides to Samsung nor when its provided. I don't think it's a stretch to assume that it could have helped Samsung with it's own products.

As others have mentioned, switching to a provider that is not its competition is a good idea for Apple.

 

[samcraig]

As others have mentioned, switching to a provider that is not its competition is a good idea for Apple.

Assuming they can provide parts of equal quality and at the same or below current contracted price - absolutely.

 

[ftaok]

Yeah, but you're missing one important point (I think, this happened awhile ago and I've slept since then).

Samsung didn't redesign the Tab10 before the announcement. Only after everyone saw Steve Jobs brag about it during the keynote speech. They didn't use their insider position to get a heads up on what Apple was doing. They only learned how thin the 2 was the same moment the general public did.

Plus, I don't believe Samsung manufactures any of the chassis for the iDevices. They're a fab plant for Apple, responsible for screens, processors, and ram.

Apart that the redesign was made AFTER the iPad 2 was presented, I still don't understand how a SoC manufacturing can give Samsung an insider knowledge about the case or the battery size

You guys are missing my point. This was a hypothetical scenario that I was painting. Samsung had to scramble to modify the Tab10 after Apple released the ipad2. They were able to react pretty quickly and get a thinner version out the door in about 3 months time.

My point is that had Samsung had a critical piece of information prior to Apple releasing the ipad2, they would not have wasted precious time developing a thick Tab10 ... they could have started with the thin design early and used the extra time to make it better.

No imagine this -

Imagine that Apple orders parts for several projects they are working on and the parts aren't related.

Again - just because I buy milk, sugar and butter doesn't mean I'm baking a cake.

You're fooling yourself if you don't think that Samsung can figure out what Apple is doing based on the types and quantity of parts they order. Is it going to be a complete picture, of course not, but Samsung has smart people working for them ... they'd figure it out.

Separating themselves from Samsung as a supplier is a good idea, provided other suppliers can pick up the slack and maintain quality. This is a huge "if" ... and it seems it's a bet that Apple is willing to take. They must have enough confidence in their alternative suppliers that it's worth the risk in order not to provide Samsung with any more insider information.

 

[samcraig]

You guys are missing my point. This was a hypothetical scenario that I was painting. Samsung had to scramble to modify the Tab10 after Apple released the ipad2. They were able to react pretty quickly and get a thinner version out the door in about 3 months time.

My point is that had Samsung had a critical piece of information prior to Apple releasing the ipad2, they would not have wasted precious time developing a thick Tab10 ... they could have started with the thin design early and used the extra time to make it better.



You're fooling yourself if you don't think that Samsung can figure out what Apple is doing based on the types and quantity of parts they order. Is it going to be a complete picture, of course not, but Samsung has smart people working for them ... they'd figure it out.

Separating themselves from Samsung as a supplier is a good idea, provided other suppliers can pick up the slack and maintain quality. This is a huge "if" ... and it seems it's a bet that Apple is willing to take. They must have enough confidence in their alternative suppliers that it's worth the risk in order not to provide Samsung with any more insider information.

I'm not being fooled. I'm simply stating that having the information they get form part supplies isn't a real advantage.

You and I can most likely predict several iterations of where the iPhone and iPad are going. We don't need inside information for that.

 

[alent1234]

I'm not being fooled. I'm simply stating that having the information they get form part supplies isn't a real advantage.

You and I can most likely predict several iterations of where the iPhone and iPad are going. We don't need inside information for that.

it took apple years to develop the ipad. samsung, a lot less to get their first tablet out the door. same with motorola.

knowing the parts your customers are ordering and how much is a huge advantage. and its not like apple just orders the parts. apple and samsung engineers have to work together to work out bugs so

dell made the same mistake with asus. companies like samsung and asus enough to start engineering their own products. where they didn't have that knowledge before

 

[Oletros]

My point is that had Samsung had a critical piece of information prior to Apple releasing the ipad2, they would not have wasted precious time developing a thick Tab10 ... they could have started with the thin design early and used the extra time to make it better.

Still waiting how a SoC or RAM design can give Samsung insight on the thinnes of the iPad

 

[samcraig]

it took apple years to develop the ipad. samsung, a lot less to get their first tablet out the door. same with motorola.

knowing the parts your customers are ordering and how much is a huge advantage. and its not like apple just orders the parts. apple and samsung engineers have to work together to work out bugs so

dell made the same mistake with asus. companies like samsung and asus enough to start engineering their own products. where they didn't have that knowledge before

Because these companies couldn't also have been working on similar products. Maybe Apple introducing the iPad sped things up in development or these projects were resurrected or whatnot Who knows. I'm guessing you don't have any facts to assert either way. Nor do I.

But keep on believing that no matter what - any supplier to Apple has such keen insight into what Apple is doing with those parts.

Further - go back to the original point. The OP (where this all began) stated they could predict iOS. Not hardware. The OPERATING SYSTEM. Based on hardware orders.

 

[Oletros]

it took apple years to develop the ipad. samsung, a lot less to get their first tablet out the door. same with motorola.

And how do you know the time Samsung spent developing the tablet?

 

[samcraig]

And how do you know the time Samsung spent developing the tablet?

He doesn't. That was my point.

 

[Renzatic]

Don't believe everything you read on wikipedia ;(

Yeah, it's a complete lie. Everyone knows Steve Jobs rode up on a white horse, clad in shining white armor, and bade the powers on high to gift the dirty, teeming masses the GUI.

That was when the stinking, low bellied thief Bill Gates snunk in on all fours to steal this gift from the gods, and thus ruin mankind's chance at paradise. Because of him, we now live in a fallen world.

 

[samcraig]

Yeah, it's a complete lie. Everyone knows Steve Jobs rode up on a white horse, clad in shining white armor, and bade the powers on high to gift the dirty, teeming masses the GUI.

That was when the stinking, low bellied thief Bill Gates snunk in on all fours to steal this gift from the gods, and thus ruin mankind's chance at paradise. Because of him, we now live in a fallen world.

And that, my friends and religious zealots was the real Original Sin.

 

[Renzatic]

My point is that had Samsung had a critical piece of information prior to Apple releasing the ipad2, they would not have wasted precious time developing a thick Tab10 ... they could have started with the thin design early and used the extra time to make it better.

But the fact is Samsung was already fabbing parts for Apple even before the release of the iPad 2. What makes things different then as opposed to now?

Plus they don't see the entire package put together, only individual parts. You can't tell what something is going to look like by just the processor and the ram, and only get a rough estimate of the size of the device by the screen. The can't tell how big the bezel is going to be, how thick it's going to be, what kind of battery it's gonna have in it. All they can tell is...

10" screen? Probably a new iPad.

Faster processor? Apple's next gen chips.

2GB ram? Well, it's about damn time.

Someone else makes the batteries for them. Someone else fabs the NAND chips. Someone else mills the aluminium chassis. Samsung can only figure out so much from what they produce.

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And that, my friends and religious zealots was the real Original Sin.

We are doomed to a life of sin because we DID NOT taste of the Apple! Do you not understand the lie you've been led to believe?

PEOPLE! GATHER ROUND, AND LISTEN...

 

[samcraig]

We are doomed to a life of sin because we DID NOT taste of the Apple! Do you not understand the lie you've been led to believe?

PEOPLE! GATHER ROUND, AND LISTEN...

I feel tremendous guilt that Steve died for the sin of me holding my iPhone wrong.

 

[Renzatic]

You should, Sam. We all should.

 

[ftaok]

Hope this is true. Once Apple moves manufacturing of essential parts to other companies, Samsung will no longer have the benefit of figuring out Apple's iOS roadmap.

Further - go back to the original point. The OP (where this all began) stated they could predict iOS. Not hardware. The OPERATING SYSTEM. Based on hardware orders.

sam, the OP you refer to was Consultant. The way I read her post was referring to iOS roadmap as the iOS device roadmap. You read it differently than I did. She hasn't come back to clarify either way.

Still waiting how a SoC or RAM design can give Samsung insight on the thinnes of the iPad

If you read my first post about that, I was saying in a hypothetical scenario, that if Samsung were also a manufacturer of aluminum cases, that would give them info on the thinness of the ipad2. Of course they don't do that, hence the hypothetical.

Anyways, Samsung provides more than just CPUs and RAM. They also provide screens to Apple as well. If you take in all of the info that Samsung knows, they could infer a lot about Apple's plans. Sure, maybe not the thinness, but they could determine the overall size and capabilities of the device.

The bottom line is that Samsung gained a competitive advantage by supplying parts to Apple. Now whether that advantage was significant or not is the debate. You feel that it wasn't significant, I feel that it was. Either way, Samsung will not be getting as much inside info on Apple's plan going forward.

 

[Dmunjal]

sam, the OP you refer to was Consultant. The way I read her post was referring to iOS roadmap as the iOS device roadmap. You read it differently than I did. She hasn't come back to clarify either way.

If you read my first post about that, I was saying in a hypothetical scenario, that if Samsung were also a manufacturer of aluminum cases, that would give them info on the thinness of the ipad2. Of course they don't do that, hence the hypothetical.

Anyways, Samsung provides more than just CPUs and RAM. They also provide screens to Apple as well. If you take in all of the info that Samsung knows, they could infer a lot about Apple's plans. Sure, maybe not the thinness, but they could determine the overall size and capabilities of the device.

The bottom line is that Samsung gained a competitive advantage by supplying parts to Apple. Now whether that advantage was significant or not is the debate. You feel that it wasn't significant, I feel that it was. Either way, Samsung will not be getting as much inside info on Apple's plan going forward.

You're probably right. But I doubt it's going to make any difference going forward either. Samsung will do fine on their own.

 

[samcraig]

You're probably right. But I doubt it's going to make any difference going forward either. Samsung will do fine on their own.

And to further - hardware - while important - matters only in how it's used. And that's the OS and UI - two things Samsung doesn't have advanced knowledge of based on part orders.

So while it could influence how powerful/screen size Samsung makes a device - it couldn't begin to influence how the device worked or what it was capable of.

 

[Renzatic]

And to further - hardware - while important - matters only in how it's used. And that's the OS and UI - two things Samsung doesn't have advanced knowledge of based on part orders.

This. I think we've just about reached the point where our mobile devices are as thin as they can get until we see the next big battery breakthrough. They might be able to shave off a millimeter here and there, but we won't be seeing considerably thinner tablets and phones for at least another 2-3 years.

Really, Apple's already been beat and then some on the hardware. They might still have the arguably best built quality of all the manufacturers, but there's slighly thinner phones and tablets out there already. Hardware? On pure specs, they've been beat and then some.

Apple's biggest advantage is in their software. I'd say that iOS is still a more efficient and better performing OS than Android at the moment. Not by huge night and day amounts, but it's still a little bit steadier and a little bit smoother a little more consistently. This is Apple's trump card. The hardware is really just a vehicle for iOS. And no one outside of Cupertino is allowed to see it down to the source code.

 

[dreadnort]

Will Apple go cup in hand to Samsung, when they start licensing flexable or curved screens?

Samsung still make parts for all the I devices, doesnt give theminside knowledge

 

[roxxette]

Good news for Samsung, they can sell to others for more profit and if Apple decides to comeback they wont agree to sell and the amazing low cost apple had the benefit to pay all this years , i think it was recently that the contract demanded to rise prices.

 

[roxxette]

I feel tremendous guilt that Steve died for the sin of me holding my iPhone wrong.

Best line in a while

 

[Archon]

1. It's business. Happens all the time. Hardly "thermonuclear."
2. If you say so
3. Buying any product these days (electronics) is not just buying American. Companies have onshore and offshore arms. Apple is a US company in that this is where they are founded and operate the HQ. It's very much a global company.

1) Your biggest customer wants to detach themselves from mutually successful business ventures deals, that does not happen all the time.

2) I know so and say so

3) Are you saying Apple selling 100 million iPhones has the same US economic impact as Samsung selling 100 million S3s?