How Samsung built their Galaxy on the back of Apple

It's widely known that, as Samsung re-invented themselves as a modern smartphone maker, they took considerable, almost absurd, inspiration from Apple. Yet copying design may not have been the only way Samsung used Apple's work to slingshot themselves to the top of the smartphone marketshare charts. Unlike every other Android manufacturer on the planet, Samsung was and is also Apple's manufacturing partner, and that might have given them a huge advantage in terms of financed capacity and knowledge of future plans. Horace Dediu addresses that very point on Asymco:

Receiving funds with which to build capacity is an enormous help when turning on production for your own versions of the product. With that knowledge and the capacity built to serve Apple, Samsung was able to go from near zero market share in smartphones to being the largest vendor in two years a feat that Apple itself could not accomplish.

James Allworth follows up on Asymco in greater detail, on how Apple can cope with this type of threat from Samsung.

So, what’s Apple got to do? In so much as it is able to trust its suppliers of key components not to become competitors, it can continue to use them. But where it can’t, or where those suppliers have already become competitors, it has only one sensible choice — replace them. It has two choices here: the first (and obvious one) is with another supplier. But that risks the same thing happening all over again — Apple nursing another supplier into a competitor. The second choice: for components and services that are critical to maintaining competitive advantage in the markets which Apple plays, Apple needs to build the components themselves.

Apple has already switched to designing their own chipsets with the Apple A6, and will be manufacturing a Mac in the US next year. The damage with Samsung is already done, however. Apple showed them how to design and manufacturer smartphones at scale, and Samsung, to their credit, learned quickly and well.

Arguably, Samsung hasn't -- yet -- done as well in tablets as it has in smartphones, but either way there's no putting their genie back in the bottle. All Apple can do now is prevent another partner from becoming a competitor.

Both articles are excellent. Read them here:

Source: Asymco, Asymco

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