Apple rumored to be reducing Samsung order for iPhone 5 memory modules

Apple rumored to be reducing Samsung order for iPhone 5 memory modulesApple is rumored to be slashing its order with Samsung for memory chips which will form part of the new iPhone 5 and other Apple products. The news comes from a report by Reuters who have been talking with a source who has direct knowledge of the matter.

Apple has been cutting back its orders from Samsung as it seeks to diversify its memory chip supply lines, although the South Korean firm remains on the list of initial suppliers for the new iPhone, the source told Reuters. The person declined to be named because the negotiations are confidential.

The Korea Economic Daily, citing an unnamed industry source, reported on Friday that Apple had dropped Samsung from the list of memory chip suppliers for the first batch of the new iPhone, the iPhone 5, which is widely expected to be unveiled next Wednesday. The report said Apple instead picked Japan's Toshiba Corp, Elpida Memory and Korea's SK Hynix to supply DRAM and NAND chips.

"Samsung is still on the list of initial memory chip suppliers (for new iPhones). But Apple orders have been trending down and Samsung is making up for the reduced order from others, notably Samsung's handset business," the Reuters source said.

It is unclear if the reduced orders to Samsung are directly related to the poor relationship between the two companies or if it is purely down to business economics. Apple is said to be sourcing its memory modules from other manufacturers however Samsung still remains a key supplier of other parts for Apple products.

After Apple won the recent patent dispute with Samsung in the United States, it should come as no surprise that Apple would be shying away from Samsung and looking to other manufacturers. It will be interesting to see over the coming years if Apple can source all components from other manufacturers and no longer have the need to rely on Samsung to fulfil its iPhone and iPad component needs.

Source: Reuters

chrisoldroyd

UK editor at iMore, mobile technology lover and air conditioning design engineer.

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Reader comments

Apple rumored to be reducing Samsung order for iPhone 5 memory modules

7 Comments

They didn't do anything with maps, Apple's license for Google Maps has ended and they chose not to extend it. It's just that simple...

It makes sense that they wouldn't want to be a source of revenue for a competitor if they don't need to be. Especially now with that particular competitor.

Actually it doesn't make much sense at all. What does make sense is that Apple would want to diversify it's suppliers. You never want to put all your eggs in one basket.

You can bet Apple feels the same way about the iphone. I'm sure they'd like to have more revenue streams (such as an iTV) to make the iphone less critical for them and have a more diversified line of margin contributors. The ipad helps but right now, Apple goes as the iphone goes. As an apple investor, the constraints Apple has on increasing phone size are concerning. The 4" 16:9 iphone 5 I would view as a band-aid. A temporary solution. But not the long term fix that doubling the resolution again could be.

Samsung will be just fine. And it's smart on Apple's part to diversify. Given the bad blood between the two, putting all your eggs in one basket just seems like a receipt for disaster. I personally believe in self-sufficiency - and I know Apple does as well as evidenced by their control-all-aspects approach. I'd like to see the day were they produce all their own parts alleviating supplier dependency altogether.