Sony prioritizing Apple's supply of iPhone cameras, cutting back on other vendors

Posted:
in iPhone
Reports from the supply chain suggest that Sony is giving priority to CMOS image sensor production to Apple, forcing other vendors to source smartphone camera components elsewhere.




As a result of Apple's demand for the iPhone 7, and future iPhone models, supply from Sony to second-tier vendors is heavily constrained, according to a report from DigiTimes. Sources claim that Sony is focusing its output on Apple, Huawei, and Oppo for the vast majority of its supply.

Apple is Sony's largest customer for CMOS image sensors. Sony focuses on mid-range and high-end smartphones, and is one of the only suppliers for the quality of sensors that Apple needs.

Because of Apple's peak and dips in demand for sensors depending on sales and production needs, Sony profits are periodically impacted by Apple. While not naming Apple directly, Sony Chief Financial Officer Kenichiro Yoshida said in January 2016 that "certain customers" ordered fewer CMOS image sensors in the previous quarter, forcing a 13 percent drop in quarterly sales, contributing to a quarterly loss.

Sony also has a new CMOS sensor package in production. The new technology will have an effective resolution of 21.2 megapixels, and will be able to capture still images at 19.3 megapixels at 30fps, 4K video at 60fps, and Full HD at 240fps in a slightly thinner package than its 12MP sensor it uses in the iPhone 7.

Samsung generates its own CMOS image sensor supply and has little in the way of sales to other vendors.

DigiTimes does generally provide accurate information from within Apple's supply chain -- which is precisely what Thursday's report is. However, the publication has an unreliable track record in predicting Apple's future product plans. often predicting both timing and features incorrectly for upcoming products.

Comments

  • Reply 1 of 19
    CelTanCelTan Posts: 37member
    And what else should they do? "So sorry, mr. Apple, we gave those 70m cameras to... oh wait, there is nobody else that uses that high quality sensors to that scale" It could also go like this: "Sorry, Mr. Apple, we used our capacity to prioritise some cheap iCopies, would you mine coming back next quarter?" Right after that stocks plummet and people get fired for being morons. Same as the nintendo sorry, you produce for your biggest client.
    anton zuykovStrangeDaysjbdragonwatto_cobra
  • Reply 2 of 19
    22july201322july2013 Posts: 278member
    As a supplier to Apple I wonder if Sony will pull a Samsung and starting selling smart phones to compete with Apple. Oh, wait, they do... 13 models.
    watto_cobra
  • Reply 3 of 19
    It makes a lot of business sense to favor your largest client. That way they'll continue to do business with you in the future. I'm sure any company would rather favor a client with ten times the business of some smaller client. It might not be fair but that's how business goes. I'm waiting to see some negative headline saying, "Apple causes other companies to unfairly suffer by submitting huge component orders." It's like when Apple was grabbing all the trees in the Cupertino area for Apple Park and local people were complaining how selfish Apple is. Beats me. First come, first serve. Apple might have put in those orders well in advance. I don't know for sure, but it's highly likely those tree supplying businesses are going to cater to Apple needing hundreds of trees over some person only needing a couple of trees.

     I'm not quite sure why articles like this even exist. Apple's iPhone production has been getting this sort of preferential treatment for years. One thing is for certain and that's vendors know they'll be getting paid on time if Apple has any credit history at all.
    edited June 2017 watto_cobra
  • Reply 4 of 19
    rotateleftbyterotateleftbyte Posts: 1,006member
    Sony do make some very good sensors. The ones they make for use in their and other companies DSLR's are very good.
    They make the sensors for the nikon D800/D810 range. 36Mp. They are apparently also making the 45/46Mp sensors for the forthcoming D820/D850.
    The ones they make for Nikon as as I understand it, like the ones that Apple uses, made to the specs of the client rather than being an off the shelf item.

    stanthemanradarthekatwatto_cobra
  • Reply 5 of 19
    blastdoorblastdoor Posts: 1,888member
    The iPhone is among the best in overall camera quality and capability, but Apple really ought to push hard to be unambiguously the best (well, in smartphones anyway -- they can't change the laws of physics). 

    Smartphone camera quality is driven by the interaction between the optics, the sensor, the ISP, and the software. Apple controls the whole widget in a way that nobody else does. They have the potential to be the best by far more than just a whisker. Time to step up their game and put the competition down for good!



    jbdragonwatto_cobra
  • Reply 6 of 19
    boltsfan17boltsfan17 Posts: 2,105member
    Sony do make some very good sensors. The ones they make for use in their and other companies DSLR's are very good.
    They make the sensors for the nikon D800/D810 range. 36Mp. They are apparently also making the 45/46Mp sensors for the forthcoming D820/D850.
    The ones they make for Nikon as as I understand it, like the ones that Apple uses, made to the specs of the client rather than being an off the shelf item.

    Sony does make great sensors. I actually bought a Nikon D810 earlier this year. I was pretty amazed by the quality of pictures after I first used it. I couldn't believe how crystal clear they were. I used to be an all Canon person, but not anymore. 
    watto_cobra
  • Reply 7 of 19
    anton zuykovanton zuykov Posts: 1,031member
     It might not be fair but that's how business goes.
    Concept of fairness is a vague and subjective concept. However, everyone agrees that making more money by having a larger client makes more business sense, because it generates more revenue, which is a goal of any business.
    watto_cobra
  • Reply 8 of 19
    Herbivore2Herbivore2 Posts: 362member
    Hardware control is still supremely important. The best sensor is actually the Samsung Isocell component. Samsung cannot produce enough of them to even meet their own internal demand, never mind the Chinese OEMs. If Sony were to prioritize the Chinese or any other vendor over Apple, any guesses where Apple will turn? It would actually create an utterly dominant Samsung in the components industry. As it is now, Samsung is going to absolutely dominate the OLED industry. LG is already out of the game. Anyone heard of Samsung's next development in OLED technology? 

    It's bioblue and promises even greater energy savings over their current AMOLED product. NO ONE else has it. Once Samsung builds the phone that can wrap around a person's wrist, running Tizen only, Google will go into an existential crisis. 

    The cheap Chinese OEMs are losing access to NAND memory, to OLED panels and now to high end digital image sensors. Apple and Samsung have launched a full scale assault on Qualcomm's business model. Soon the Chinese OEMs will lose access to high performance mobile SOCs and high performance baseband radios also. 

    And the Android apologists still bury their heads. It's absolutely incredible. Unbelievable really. And people still think that Jobs fed us the KoolAid. Google doesn't even try to hide the cyanide in KoolAid. 

    Wishful thinking won't change reality. There will only be two players in the mobile hardware market, Samsung and Apple. Samsung WILL control the non iOS portion of the market. It all comes down to who has access to the superior hardware. Google does not. Nor can they realistically develop that capability either. They had better be hard at work porting the play store and their apps onto Tizen. Else Samsung will develop their own alternative. Much like MSFT developed windows in response to Mac OS. Very few remember the Windows 3.1 days. But MSFT eventually got it right, er. . . close enough to Mac OS that few cared. The same will happen to Android. It's coming. 

    There is going to huge differences in a cheap $200 mobile Android device and high end offerings from Samsung and Apple. The real problem is that the Chinese are going to taking major losses even selling devices for those prices. And it's quite doubtful that Samsung will be selling their high end components to the likes of HTC, Oppo, Huawei, Xiaomi and the like. If they do, it will be for far higher prices than what Samsung mobility will be paying for them. 
  • Reply 9 of 19
    NotsofastNotsofast Posts: 296member
    Hardware control is still supremely important. The best sensor is actually the Samsung Isocell component. Samsung cannot produce enough of them to even meet their own internal demand, never mind the Chinese OEMs. If Sony were to prioritize the Chinese or any other vendor over Apple, any guesses where Apple will turn? It would actually create an utterly dominant Samsung in the components industry. As it is now, Samsung is going to absolutely dominate the OLED industry. LG is already out of the game. Anyone heard of Samsung's next development in OLED technology? 

    It's bioblue and promises even greater energy savings over their current AMOLED product. NO ONE else has it. Once Samsung builds the phone that can wrap around a person's wrist, running Tizen only, Google will go into an existential crisis. 

    The cheap Chinese OEMs are losing access to NAND memory, to OLED panels and now to high end digital image sensors. Apple and Samsung have launched a full scale assault on Qualcomm's business model. Soon the Chinese OEMs will lose access to high performance mobile SOCs and high performance baseband radios also. 

    And the Android apologists still bury their heads. It's absolutely incredible. Unbelievable really. And people still think that Jobs fed us the KoolAid. Google doesn't even try to hide the cyanide in KoolAid. 

    Wishful thinking won't change reality. There will only be two players in the mobile hardware market, Samsung and Apple. Samsung WILL control the non iOS portion of the market. It all comes down to who has access to the superior hardware. Google does not. Nor can they realistically develop that capability either. They had better be hard at work porting the play store and their apps onto Tizen. Else Samsung will develop their own alternative. Much like MSFT developed windows in response to Mac OS. Very few remember the Windows 3.1 days. But MSFT eventually got it right, er. . . close enough to Mac OS that few cared. The same will happen to Android. It's coming. 

    There is going to huge differences in a cheap $200 mobile Android device and high end offerings from Samsung and Apple. The real problem is that the Chinese are going to taking major losses even selling devices for those prices. And it's quite doubtful that Samsung will be selling their high end components to the likes of HTC, Oppo, Huawei, Xiaomi and the like. If they do, it will be for far higher prices than what Samsung mobility will be paying for them. 
    You are making a lot of assumptions about OLED.   Apple may be preparing to leap past reliance on Samsung with their investments in microled
    tmayjbdragonwatto_cobra
  • Reply 10 of 19
    brucemcbrucemc Posts: 1,499member
    ...
    Wishful thinking won't change reality. There will only be two players in the mobile hardware market, Samsung and Apple. Samsung WILL control the non iOS portion of the market. It all comes down to who has access to the superior hardware. Google does not. Nor can they realistically develop that capability either. They had better be hard at work porting the play store and their apps onto Tizen. Else Samsung will develop their own alternative. Much like MSFT developed windows in response to Mac OS. Very few remember the Windows 3.1 days. But MSFT eventually got it right, er. . . close enough to Mac OS that few cared. The same will happen to Android. It's coming. 

    There is going to huge differences in a cheap $200 mobile Android device and high end offerings from Samsung and Apple. The real problem is that the Chinese are going to taking major losses even selling devices for those prices. And it's quite doubtful that Samsung will be selling their high end components to the likes of HTC, Oppo, Huawei, Xiaomi and the like. If they do, it will be for far higher prices than what Samsung mobility will be paying for them. 
    I am skeptical.  With smartphones, it is about the s/w & ecosystem, more than the hardware IMO.  Developing a new OS/ecosystem that would displace Android seems impossible at this point - and Samsung has no credibility in s/w.  As long as Android is the OS of the non-Apple space, there will be a variety of competitors.  While low-end manufacturers will come & go without impact on the industry, there is still competition for Samsung at the high-end, specifically in Huawei. H// is not just selling smartphones, but is the largest telecommunications equipment vendor in the world (I know - our company competes with them:).  They are a huge company, with revenues expected to hit 100B USD revenue in next year or so.  They are leveraging their telecom infrastructure business to help sell mobiles.  And from what I have heard of their phones, they have high end models expected to do well in Europe as well as home China market.  That isn't to spell out doom for Samsung, but to note the competition even at high-end, when everyone using a (mostly) common OS.
  • Reply 11 of 19
    avon b7avon b7 Posts: 3,200member
    Just to add that Huawei has even out-spent the likes of Apple in the past on R&D and has publicly stated it wants to be the world's top or second placed smartphone vendor by the end of the decade. It is well placed for 5G too.

    On the image sensor front, we might well see dual front and rear cameras on the future Mate 10 in a few months.

    The end of the year is looking good for high end smartphone competition.
  • Reply 12 of 19
    gatorguygatorguy Posts: 19,805member
    sog35 said:
    Take that you cheap piece of shit China brands!!!
    You missed the entire quote about who Sony is prioritizing. It's not just Apple. Sony is giving priority to Apple, and China-based Huawei, Oppo and Vivo. Were those some of the China brands you were referring to? 
  • Reply 13 of 19
    The cheap Chinese OEMs are losing access to NAND memory, to OLED panels and now to high end digital image sensors. Apple and Samsung have launched a full scale assault on Qualcomm's business model. Soon the Chinese OEMs will lose access to high performance mobile SOCs and high performance baseband radios also.

    Ignoring your repeated "Google is DOOMED" theory, I am just highlighting the facts about 2 new sentences that are added in your latest post.

    high end digital image sensors - Sony is prioritizing the Chinese OEMs along with Apple, as Gatorguy has already pointed out.

    High performance mobile SoCs - Huawei is ONE of the 3 companies who make high performance mobile SoCs in Android world, apart from Qualcomm and Samsung(NO, mediatek don't count, yet). Their latest SoC Kirin 960 is on par with SD 821 and Exynos 8890. Their upcoming Kirin 970 will reach the level of SD 835 and Exynos 8895 or even beat them. Yes, Huawei is about 6 months behind Qualcomm and Samsung in high-end SoCs, but not FAR behind. The gap is narrowing over the past 2 years. So to think that Chinese OEMs would NOT have high-end SoCs is FAR from ground reality.

  • Reply 14 of 19
    gatorguygatorguy Posts: 19,805member
    Even the little Chinese OEM's are building in really great cameras now, which seems to be the "focus" of a lot of companies. Don't know where the camera module sources from but the just announced Nubia Z17 features dual rear cameras at 12 & 23MP, f/1.8 2x zoom rear, and a 16MP wide-angle front one.
    http://www.nubia.com/en/presscenter.php?a=showArticleDetail&id=16

    High-end hardware but mid-range pricing is what is causing Apple to lose share in the Chinese market. Those home-grown smartphone companies certainly caught on fast, and increasingly are the ones to offer the very latest tech. This one for instance is the first to offer Qualcomm's QC4+ Quickcharge, beating out the likes of LG, Samsung, Apple and other big OEM's. Still for well under $500US, under $600 for even their premium version. 
    edited June 2017
  • Reply 15 of 19
    avon b7avon b7 Posts: 3,200member
    gatorguy said:
    Even the little Chinese OEM's are building in really great cameras now, which seems to be the "focus" of a lot of companies. Don't know where the camera module sources from but the just announced Nubia Z17 features dual rear cameras at 12 & 23MP, f/1.8 2x zoom rear, and a 16MP wide-angle front one.
    http://www.nubia.com/en/presscenter.php?a=showArticleDetail&id=16

    High-end hardware but mid-range pricing is what is causing Apple to lose share in the Chinese market. Those home-grown smartphone companies certainly caught on fast, and increasingly are the ones to offer the very latest tech. This one for instance is the first to offer Qualcomm's QC4+ Quickcharge, beating out the likes of LG, Samsung, Apple and other big OEM's. Still for well under $500US, under $600 for even their premium version. 
    Yep. And Huawei designs its own battery tech and associated fast charging tech too. They just added graphene into the mix to increase the temperature range at which their batteries can operate (but not their smartphones, yet).

    www.eenewseurope.com/news/high-temp-li-ion-battery-breakthrough-uses-graphene-based-tech-0

    They are working closely with Leica on the cameras and have their own ISP onboard as their own chip design.

    All providing solid competition to Apple and Samsung at competitive prices. Cameras have clearly been an area of growth at the high end but quality cameras are fast entering the middle range where Q117 saw the most growth in smartphone sales (both the very low end and very high end saw some contraction). The result is that Apple is seeing far more competition of late on tech, price and design. The next iPhone will give them another boost but beyond that...
    edited June 2017
  • Reply 16 of 19
    brucemcbrucemc Posts: 1,499member
    avon b7 said:
    gatorguy said:
    Even the little Chinese OEM's are building in really great cameras now, which seems to be the "focus" of a lot of companies. Don't know where the camera module sources from but the just announced Nubia Z17 features dual rear cameras at 12 & 23MP, f/1.8 2x zoom rear, and a 16MP wide-angle front one.
    http://www.nubia.com/en/presscenter.php?a=showArticleDetail&id=16

    High-end hardware but mid-range pricing is what is causing Apple to lose share in the Chinese market. Those home-grown smartphone companies certainly caught on fast, and increasingly are the ones to offer the very latest tech. This one for instance is the first to offer Qualcomm's QC4+ Quickcharge, beating out the likes of LG, Samsung, Apple and other big OEM's. Still for well under $500US, under $600 for even their premium version. 
    Yep. And Huawei designs its own battery tech and associated fast charging tech too. They just added graphene into the mix to increase the temperature range at which their batteries can operate (but not their smartphones, yet).

    www.eenewseurope.com/news/high-temp-li-ion-battery-breakthrough-uses-graphene-based-tech-0

    They are working closely with Leica on the cameras and have their own ISP onboard as their own chip design.

    All providing solid competition to Apple and Samsung at competitive prices. Cameras have clearly been an area of growth at the high end but quality cameras are fast entering the middle range where Q117 saw the most growth in smartphone sales (both the very low end and very high end saw some contraction). The result is that Apple is seeing far more competition of late on tech, price and design. The next iPhone will give them another boost but beyond that...
    ...so you believe that Apple will have some differentiating new features/functions in this year's iPhone, but that is not likely to be the case going forward?
  • Reply 17 of 19
    avon b7avon b7 Posts: 3,200member
    brucemc said:
    avon b7 said:
    gatorguy said:
    Even the little Chinese OEM's are building in really great cameras now, which seems to be the "focus" of a lot of companies. Don't know where the camera module sources from but the just announced Nubia Z17 features dual rear cameras at 12 & 23MP, f/1.8 2x zoom rear, and a 16MP wide-angle front one.
    http://www.nubia.com/en/presscenter.php?a=showArticleDetail&id=16

    High-end hardware but mid-range pricing is what is causing Apple to lose share in the Chinese market. Those home-grown smartphone companies certainly caught on fast, and increasingly are the ones to offer the very latest tech. This one for instance is the first to offer Qualcomm's QC4+ Quickcharge, beating out the likes of LG, Samsung, Apple and other big OEM's. Still for well under $500US, under $600 for even their premium version. 
    Yep. And Huawei designs its own battery tech and associated fast charging tech too. They just added graphene into the mix to increase the temperature range at which their batteries can operate (but not their smartphones, yet).

    www.eenewseurope.com/news/high-temp-li-ion-battery-breakthrough-uses-graphene-based-tech-0

    They are working closely with Leica on the cameras and have their own ISP onboard as their own chip design.

    All providing solid competition to Apple and Samsung at competitive prices. Cameras have clearly been an area of growth at the high end but quality cameras are fast entering the middle range where Q117 saw the most growth in smartphone sales (both the very low end and very high end saw some contraction). The result is that Apple is seeing far more competition of late on tech, price and design. The next iPhone will give them another boost but beyond that...
    ...so you believe that Apple will have some differentiating new features/functions in this year's iPhone, but that is not likely to be the case going forward?
    There are many factors coming into play.

    Saturation.
    More high end phones fighting it out in the same space as Apple.
    Far better phones than ever before in the lower tiers just under where Apple sets out its store - and at better prices.
    5G will allow for far more options than 4G and competitors are very well placed to hit the ground running.
    Apple's stagnant market share.

    Apple could put some nice options on the table with the next iPhone, no doubt about it, and there is pent up interest. The problem is how much of that interest translates into actual sales if rumours of a $1,000 plus price tag prove true.

    Let's run with a smash hit. What comes after that?

    Recently, Apple has been behind in key areas. For example screen size. Just as well they finally released the Plus because it has made up a large chunk of revenue over the last couple of years. Most people agree that Siri (as of today) is lacking. They now have a stale design on their phones. Samsung and Huawei have also released designs that are just as similar and stale but the last time I checked at a big retailer (Media Markt) Huawei had 15 phones on the stands (something for everyone at all price points) and some of them were absolutely gorgeous. That's without counting Honor. Apple had three. For varying reasons, carriers are promoting rival phones over iPhones, in stark contrast to a few years ago. Apple is way behind on fast charging and wireless charging. OLED? Catch up again. iOS is not showing any great progress for the end user and Android is steadily correcting a lot of its historical problems. Cameras, once a deciding factor for many, are now good enough right down into the mid range. Speed? Most people simply don't run into speed issues. A faster new phone isn't really going to feel much faster than a current phone. AI, VR and AR will need some power but that power will be there on the first wave and just filter down to the mid range over time. Just like cameras have.

    AI and especially AR is going to require collaboration. I can use Apple Maps and get some information pop up on the map. The same map on Google Maps will give me infinitely more information about the same area. That's because there are so many more users pumping information into Google. AR will live or die by the state of the information it feeds off. I doubt Apple will be able to break away from the pack for long in either field.

    So even if the next phones are runaway successes what cards can be played next? Don't we already have most of what we need now? What do you look for in a phone that isn't already available? Let's give Apple a 20% share of the market. Do you think it is likely to grow rapidly over the next five years? Most of the factors I have​ given are facts with some opinion thrown in.

    Many articles on AI cite Counterpoint for market analysis but I don't think anyone mentioned the Counterpoint piece that reflected massive growth in the 'affordable premium' segment and stalling in the lowest and highest ends. People say 'Apple doesn't cater to that market' but if the trend were to continue, would it be wise to stay out of that segment? 

    Once, you could expect to see iPhones a plenty in Finland. Apple has been virtually wiped from the map there now.

    Apple's strongest market for premium phones is the US market simply because some competitors are being prevented by government from rolling out the same practices that saw Apple overwhelmed in Finland.

    It's impossible to know how things will pan out but I have given you some real reasons as to why it will be much harder for the Apple of today to replicate the growth of the last seven years in the coming seven years.

    You asked me about Apple but I'm not saying Android, Samsung, Huawei etc Will have it any easier. No one stays top forever though.



    edited June 2017
  • Reply 18 of 19
    irontedironted Posts: 129member
    The Chinese are making their own processors eg. Huawei with its Kirin and Xiaomi with its Surge. Omnivision who makes sensors has been bought by China. I would like Apple to be brought down a peg since it is too dominant, thank you.
    edited June 2017
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