Samsung plans to terminate LCD supply contract with Apple - Page 4

It's just as well, Samsung have a huge conflict of interest.  No way Samsung could avoid copying Apple's designs before Apple even delivers a new product.

Obviously Apple was already removing component production away from Samsung.

 

I'm sure other Apple suppliers are happy and may even come out with components better than Samsung's.

 

Apple is a business, this is a business decision. If it is in Apple's interest to do more business with Samsung in the future, they will. Just like Apple still deals with Microsoft, Adobe and Intel despite past competition and legal wrangling. I don't see a competent manager wasting time thinking up ways to screw with a major company with cutting edge technology that may be a future vendor.

 

 

You should get some perspective. Sharp has been making LCDs much longer than Samsung. Further, unlike Samsung, it actually builds all its own displays. In low to mid end televisions, Sharp's displays kick Samsung's butt. Where Sharp needed help was being able to produce smaller screens in the quantity companies like Apple needs. Some people might have forgotten, but Apple invested heavily in Samsung's display business years ago to help Samsung build the manufacturing capacity up to where it is at now. Apple and Foxconn are now doing the same with Sharp.

 

As far as profit margin being thin, that might be true, but it adds up over millions of units. Further, it is so thin that Panasonic wants to stop making TVs and focus just on building displays for companies like Apple. Whatever the case might be, Apple isn't hurting from the profit margins being thin. 

 

As far as Samsung's own divisions to feed its own production is concerned, you might be right, but each of Samsung's divisions are treated as different companies. So one Samsung division sells the product to the other divisions. Sure there is some discount built in there, but the division that is selling the product is trying to make a profit. Moreover, Samsung's top end phones often times cost more than Apple's. 

 

can you backup your statement "Apple invested heavily in Samsung" with legitimate sources?  or are you talking about the measly $100M Samsung received in late 1990's?

 

That sounds a bit nonsensical - especially given that most Apple displays until Apple's new iPads were made by LG.  (And LG is still LOSING money)

Edited by tooltalk - 10/22/12 at 5:31pm

 

i doubt using one (1) example from five (5) years ago will sway people to your opinion.

Then simply Google "broken samsung tv" and get countless hits!

 

last i heard, Foxconn has a ten (10) percent / $800+ million stake in Sharp Corporation.  Apple would have to invest about $3.5 billion to make Sharp Corporation a subsidiary of Apple / Foxconn.

Edited by emacs72 - 10/22/12 at 2:16pm

Made by Sony, not Samsung.

 

... which does absolutely nothing to strengthen your opinion.  if you type in 'broken apple iphone' in Google or Bing you'll get many more hits than the Samsung query.  both Samsung and Apple make quality products, and from both companies some items don't perform up to spec.

As my Grandmother would have said: "Cutting off your nose to spite your face".

I guess you missed the news earlier this year when Apple announced that they were prepaying $3.9 Billion to their suppliers.

Much of this money was being fronted to Samsung's competitors who needed investment in their LCD factories.

I don't think Apple is worried, they have been planning this for a few years.

http://www.youtube.com/results?search_query=broken+samsung+tv&oq=broken+samsung+tv&gs_l=youtube.3..35i39.13383.13383.0.13739.1.1.0.0.0.0.63.63.1.1.0...0.0...1ac.1.G2lRQBQ7_Zo

It perhaps could build the factories in the US, but they'd have to bring Chinese workers here to do the actual work. The US does not have trained workers; we graduate MBA's and bankers and financial advisors not folks who can make stuff. And who's going to train enough tool and die makers and build tool and die factories to build the components that go into the iDevices? 

 

Where is Apple going to find skilled high school students who will eventually learn the engineering to learn the skills to build the plants that build the machines that make the tools that make the machines that make the components that are assembled into the iDevices. 

 

Apple's $100B is far less then 1% of the amount of money necessary to build the infrastructure to start the process of bringing these job into the US. How much time would all this take? At least 2 generations or about 40 years. That is the number of years the US has been neglecting basic infrastructure and education in the useful arts. The last generation that had these skills in sufficient quantity was the WWII generation; by the mid-1970's this generation was reaching their 60th year, and retiring with comparatively few able to replace them. 

 

Dream on. 

 

Doesn't matter, just commenting that OEMs are moving beyond ~330 ppi...  HTC have always been the best Android manufacturer, and once again they're leading the way...  

 

Anyhow, S-LCD was a Sony/Samsung joint venture, and now I believe Samsung are the owners.  Samsung products might suck, but their manufacturing is great - they make some of the best memory, SSDs, and various other parts...  

 

 

Well, hope it works out for Apple..  $3.9B sounds a lot, but Samsung spends that much in a month+. 

According to Anandtech, Samsung is bailing out because Apple was trying to get better pricing from Samsung (based on what they get from other suppliers), and Samsung claims they cannot compete under such pricing (while keeping quality?).

If true, here might be a reason why LG and Sharp have more quality issues.

This will be interesting on both ends - to see how will Apple overcome suppliers change in terms of volumes and quality, and what will Samsung do with additional manufacturing capacity. I'm expecting them to become even more aggressive with releasing new products. Anandtech has a Dailytech news about new Google 10" tablet with 2560x1600 resolution. Cannot open link from my office right now (http://www.dailytech.com/article.aspx?newsid=27995) but wouldn't be surprised Samsung is behind that screen...

All that being said. We had some issues with Samsung's monitors at work, as well as some of my colleagues had at home. Last 4 Samsung monitors dead lived just through their 3 year warranty and died within a few months after that. Coincidence it could be, but... as the old saying goes, bitten by the snake, scared by a lizard. Majority of our office monitors are Viewsonics nowadays, and I cannot say our office screen reliability went down at all. In fact we're still to replace any of our Viewsonics (and some are over 4 years old). I'm personally using LGs at home, both TVs and monitors, and can't find a complain, at least not for the money invested. Based on that humble experience of mine, I'd be surprised if this shift causes any problems to Apple.

 

Well, they couldn't compete with Samsung when they were financially better off back in the 90's.  Why are they going to all of sudden make *better* products now?

 

Everyone in the display business is losing money - except for Samsung.  Everyone in the semi business (memory) is losing money - except Samsung and Toshiba.  

Edited by tooltalk - 10/22/12 at 5:27pm

 

I'd take a Sharp display over a Samsung any day. Far superior.

 

I think Sony Mobile Display is still in business - in fact, it is now part of Japan Display LTD.   HTC is moving from Samsung because of the AMOLED shortages (caused by the growing internal demand from Samsung Mobile). 

 

Funnily enough last night a couple of my friends were saying some fairly insane things in their derision of all things Apple/iPhone.

 

Agree on both counts. Sharp and Panasonic would be great partners for Apple, from this consumer's point of view at least.

And in both of those key businesses they are about to lose their single biggest customer. Can Samsung mobile make up for those orders? Maybe. It was only a couple years ago that Samsung's mobile business was so bad that they stopped reporting on their sales and rolled them into the display numbers (because that made a ton of sense). Getting the Nexus twice has put them far and away at the top of the Android world, but for how long? Can other companies make up for Apple leaving? Maybe. Given their financial state, relying on the other Android vendors probably isn't a great goal either.

Oh, I'm sure Samsung's smooth sales can do make up the difference.

 

Actually neither of you have any idea what you are talking about.  Samsung was not a small mom-and-pop shop near Busan, South Korea in 1999.  Samsung was already a huge conglomerate, though not as big as Sony back then, many times bigger than Apple in terms of sales, profit, employees, etc, etc.  To claim that Apple's puny $100M investment somehow changed Samsung is not even laughable. 

 

Of course, there was (and is) no such firewall.  There are well over 100 Samsung subsidiaries under Samsung Electronics - and I'm not sure why, but many here in AI seem to believe that they are all compartmentalized, firewall'ed, etc.   No, these are nothing more than legal / accounting niceties. 

 

Strange, I'd never thought so myself and assumed the latter. Samsung mobile's design direction in the past few years would show this to be true.

There is none for Apple; there are several good suppliers waiting and happy.  Apple wouldn't have pushed this if they would suffer when Samsung: "says we quit you Apple"

Samsung loses out here, both from parts manufacturing and their early spying activity on Apple.

 

That statement just attracts people like me to fire back the bullet you've just shot.

 

Here are FACTUAL queries from Google.

 

 

"broken samsung tv"    About 12,000,000 results

 

"broken iphone"   About 235,000,000 results

 

That is close to 20 times more results.

 

Oh snap.

 

 

 

Just to be fair

 

"broken galaxy s" About 19,100,000 results

 

See how that works?

Edited by Galbi - 10/22/12 at 7:14pm

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Edited by MacRulez - 1/23/13 at 6:04am

Actually I do think that the Samsung businesses in question are compartmentalized between components sales and their other mobile devices department, I read it over the Korean times earlier this year. They were affirming that sales of components weren't done according to what could be the best interests of the other department (e.g. keeping the latest tech for them, etc), but to sale the most. Which is rather logical as it grows their business wherever their other products are a success or not.

You were already called out at how tenuous those kinds of search queries can be in supporting your opinion, seriously.

It will happen eventually but it is more likely to be Apple's choice than Samsung's. Samsung knows it would be dumb to completely forgo lucrative guaranteed sales from Apple in favour of the supplying their own mobile division. They probably remember that it was only a couple years ago that their mobile sales were so poor they had to hide their numbers in with their display sales. While they rule the Android space for now, that can change in a heart beat. Putting all their eggs in one basket, and a basket that isn't that well made, probably isn't an idea they want to pursue.

 

You talk like Apple can reign supreme for many years. Remember how Nokia was #1 not too many years ago? The same thing could happen to your love child.

 

Samsung has diverse businesses that can supplant each other with funds and core competencies. Therefore, they can weather the various storms thrown at them in both booms and bust times.  Apple, on the other hand, do not have that luxury.

 

 

Take a look at this:

 

 

 

 

All those statements are from someone who actually follows the industry and have know-how.

 

This is absolutely incorrect. At the store where I got my mid-level rMBP, there were approximately 15 high-end rMBPs in stock. Only 1 of those had a Samsung display.

Like I said, most managers will not admit to the existence of said system either because they don't know it exists or they don't want a flood of customers choosing a product based on the component manufacturer.

 

'tooltalk' - I am in your camp.

 

We agree there was/is no firewall.

 

My statement about Apple investing in Samsung refers to Apple having first access and pre-purchasing of product for 'Apple to lead in the LCD space' with iBook, PowerBook, and more importantly a looming 3rd gen iMac going all LCD.  I would never infer that Apple somehow 'built' Samsung up or anything close.  I own and still love my Samsung LCD TV, still kicking after 4 years.  Samsung was a powerhouse then and certainly is now the new 'Sony'.

 

I do know what I am talking about.  I am saddened to see this 15 year relationship end on such bad terms.

No, I am talking like someone who realizes that Apple has been doing pretty well for a fair bit of time and also likes to prepay for many of their components to ensure supply. Samsung's tremendous consumer success, especially in mobile has been much more recent and is not nearly as certain. Again, just two years ago they thought it was necessary to start hiding their mobile sales in with their display sales because they were so bad. Having one division count on another, far from secure, division is not a well thought out plan. Certainly they can weather the storm, who said they couldn't? But giving up the huge orders from Apple, often prepaid well in advance, in exchange for a maybe order from their successful-for-now mobile division doesn't sound like a good idea. From Samsung denial of the ending of the relationship, it sounds like they agree.

How about we are getting into this "game" as a group of potential Samsung customers? Every time I see one of these Samsung "the-next-thing-is-already-here" commercials on TV, I feel like they portray all iPhone buyers as being the stupid ones. How can I (we) return the "favor"? I can't buy more iPhones but we could stop buying Samsung's TVs, washers, dryers and refrigerators. There are very good alternatives out there.
I can't wait to see the appliance division's VP calling his counterpart in the mobile group saying "Hey why don't you advertise your (great) hardware instead of alienating our (my) customers? We are sitting here on 50,000 unsold units...!"

I really wonder where their mobile marketing group is based: here in the U.S. or in Korea? They should know that this type of advertising just doesn't work here.

 

10 cents profit on a unit or 1 cent - it's still profit.  Where are these folks coming from?   Laughable!

Then again - What do I know?  

 

 

Obviously he's bullish on Samsung.  The bottomline is that Samsung and Apple is in a fierce war over patents and marketshare.  It's a bitter divorce we're following the past year or two.

 

With the eventual announcement of the Nexus Phone made by LG and one from Sony, Samsung may take a hit in the competitive Android marketshare.

 

Android is very competitive as some in the thread has pointed out, it can take just 1-2 product cycles to crown the new King of the Androids.

 

Sometimes the best thing you can do is to make a clean split.

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Edited by MacRulez - 1/23/13 at 6:07am