This is all hypothetical, but what would happen to the iPhone 4 if Apple’s vigorous legal campaign against Samsung caused an irreparable rift between the two companies?
Several key components of the iPhone 4 including the Flash Memory, DRAM memory and applications processor come from Samsung. Together, these account for $US45.68 in parts which is 26 per cent of the final component cost of the iPhone 4.
If Samsung were to turn its back on Apple, who would supply these components, how much would they cost and how quickly could another company supply them? We don’t often think about it, but Samsung supplies these critical components to Apple at a reasonable price and it supplies them at a volume few companies could match. Remember, Apple shipped 20 million iPhones last quarter which is a lot of processors and flash modules in a relatively short amount of time.
Thankfully, there’s no sign Samsung is ready to walk away from one of its biggest customers. But with Apple winning injunctions left and right against the Galaxy Tab, you can’t help but wonder, what if? [The Economist]