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Last updated on April 23, 2014 at 21:24 EDT

Samsung Will No Longer Supply LCD Panels To Apple

October 22, 2012
Image Credit: Apple

Michael Harper for redOrbit.com — Your Universe Online

As it turns out, several global lawsuits and a 1 billion dollar payout can strain the relationship between two companies.

Samsung is a company with many tendrils wrapping around the computing, consumer and mobile markets. While Samsung´s Mobile arm may have been battling with Apple, their parts manufacturing arm still counted them as one of their best customers. Throughout their legal skirmishes, observers have been wondering how long this awkward relationship could stand underneath the pressure. While cracks in their happy facade have been showing for a while now, Samsung has officially announced they´ll begin severing ties with Apple, one tendril at a time.

A Samsung source told the Korea Times today they they´ll no longer be supplying LCD panels to the iPad maker, effective next year. The Korean company has said the rigid supply chain structure of Apple´s products could make the relationship no longer as profitable as it once was. Apple has also begun shopping elsewhere for their LCD displays in recent years, such as Sharp, LG and AU Optronics.

A Samsung source, who asked not to be named, told the Korea Times that the company would no longer be able to offer Apple the displays they need at the price they want.

“We are unable to supply our flat-screens to Apple with huge price discounts. Samsung has already cut our portion of shipments to Apple and next year we will stop shipping displays,” explained the unnamed senior source.

According to the Korea Times, there have been numerous other “unnamed sources” who have said Samsung will be moving much of this lost business to Amazon, an up and comer in this mobile device battle between Apple, Google and Samsung. During the first 6 months of 2012, Samsung was responsible for shipping more than 15 million LCD panels to Apple, making them the largest supplier for Apple LCDs. LG and Sharp came in second and third, shipping 12.5 million and 2.8 million panels, respectively.

The senior Samsung source told Korea Times, however, that shipments in recent months have been down considerably, with Samsung only shipping less than 3 million panels to Apple in the third quarter. According to the source, it will only get worse as 2012 comes to a close.

“We expect the quarterly shipment in the fourth quarter to fall to some 1.5 million,” said the Korea Times source, who is directly involved with this issue.

As further proof that Apple has already begun taking their business elsewhere, Samsung will not be providing displays for Apple´s rumored iPad Mini which may be announced tomorrow.

According to a Digitimes article, AU Optronics is responsible for more than  500,000 of these new 7.85-inch displays, with Sharp and LG filling the rest of the orders.

An earlier Korea Times report also suggests that the relationship between Apple and Samsung is moving from “Love-Hate to Hate-Hate,” as Apple has even begun to look elsewhere for their microprocessors.

According to the Korea Times piece, Apple´s latest A6 chip found in the iPhone 5 is not the result of a collaboration between the two companies.

“Samsung´s agreement with Apple is limited to manufacturing the A6 processors. Apple did all the design and we are just producing the chips on a foundry basis,” said another unnamed senior Samsung source.


Source: Michael Harper for redOrbit.com – Your Universe Online