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Apple Increases Use of Samsung DRAM Despite Patent Disputes
No Choice
Apple Increases Use of Samsung DRAM Despite Patent Disputes
  • By matthew
  • August 26, 2014, 05:11
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Apple needs Samsung again. Apple has been decreasing the use of Samsung components due to patent disputes that have been lasting for three years, but has recently increased the purchase of Samsung components again. Production would be inevitably suspended due to a supply shortage if Apple keept excluding products from Samsung Electronics.

According to the related industries and foreign press on August 25, Apple decided to use Samsung Electronics mobile DRAM in the iPhone 6 to be released this coming September, and requested Samsung Electronics to supply these components.

In its previous iPhone 5 and iPhone 5S, Apple excluded Samsung Electronics from the list of long-term suppliers, and only used mobile DRAM manufactured by SK Hynix and Micron. Apple has been trying to reduce the supply from Samsung Electronics due to fierce competition and intense disputes over patents.

Apple has been very persistent, but had no choice but to ask Samsung Electronics a favor due to a supply shortage of mobile DRAM. In order to meet the production target right before the release of new model, there is no solution other than to greet Samsung Electronics, the number one company in mobile DRAM, again.

DRAM Exchange, a market research company, projected, “Major manufacturers do not have expansion plans for their facilities. As Apple is preparing to launch new products including the iPhone, iWatch, and MacBook Air, supply of mobile DRAM is very tight.”

Apple has been excluding Samsung Electronics from suppliers of major components, including application processors (AP) and batteries, since 2012, but is returning to its previous practices from this year. Apple decided to load the mobile AP of Samsung Electronics in the iPhone from next year.

Apple has been trying to diversify component suppliers so far. As a part of the plans, Apple chose the TSMC of Taiwan over Samsung Electronics on 20 mn APs for the iPhone 6. However, as Samsung Electronics showed more advanced technologies than its competitors, for example, by successfully developing 14 nano test chips for the first time in the industry, Apple changed its mind.

Apple also increased purchases from Samsung Display. Although Apple attempted to decrease its dependence on Samsung Electronics by having supply contracts of panels with Sharp of Japan and AUO of Taiwan, Apple had to suffer from production suspension due to late supplies. In fact, Apple accounted for 9 percent of the total sales revenues of Samsung Display during the first quarter of this year, a 6 point increase from a year ago. This exceeds 8 percent, which was recorded before Apple tried to decreased purchases from Samsung Display.