Are you suggesting that a total cost 2.4% of SRP for all patents would be a reasonable amount?
Such an amount would be far greater than the profits from Apple's components orders.
I didn't say any such thing.
I said that 2.4% for each patent is absurd.
Then I said that Microsoft is receiving $5 per unit from Android handset makers for all of their patents - many of which are not FRAND. And FRAND licensing is generally less.
By comparison, I would expect that Apple would pay less than $5 per handset to license FRAND technologies from Samsung - and much of that has already been paid by the chip manufacturers. But even if you choose $5, that's well under 1% of the price of a handset.
Considering that Apple gets a discount for buying components in bulk and paying upfront with cash, would Samsung be better off replacing Apple with a bunch of smaller clients to whom they do not have to offer a bulk discount?
You answered your own question with the statement in bold. The smaller clients aren't going to give Samsung an upfront cash payment. Most of them are going to buy on credit. Also, one customer buying $8 billion worth of stuff is far more valuable than 10 customers buying a combined total of $8 billion.
I agree though that Apple should consider quality when choosing a supplier. However, Apple has shown that they don't fire from the hip. Chances are that if they've chosen to move to another supplier, they've done their due diligence.
It also may well be that the media is embellishing this. Apple is a large customer. They might be trying to diversify component suppliers because one supplier can't make enough for Apple.
You answered your own question with the statement in bold. The smaller clients aren't going to give Samsung an upfront cash payment. Most of them are going to buy on credit. Also, one customer buying $8 billion worth of stuff is far more valuable than 10 customers buying a combined total of $8 billion.
Says who?
First, the $8 B customer is probably paying lower prices than the $800 M customers. Second, most companies intentionally try to diversify and avoid having too many eggs in one basket.
Quote:
Originally Posted by vvswarup
I agree though that Apple should consider quality when choosing a supplier. However, Apple has shown that they don't fire from the hip. Chances are that if they've chosen to move to another supplier, they've done their due diligence.
It also may well be that the media is embellishing this. Apple is a large customer. They might be trying to diversify component suppliers because one supplier can't make enough for Apple.
Of course the press is embellishing. Sometimes simply making things up, as well. That's what the press does.
Absolutely moot. Apple doesn't HAVE to switch. If they can't find an equal alternative, they can continue to buy from Samsung. But Apple has the option to choose someone else. If Apple does so, Samsung loses.
I was responding to LunarMoon's suggestion that Apple WILL ditch Samsung if Samsung wins in court. Either way, I expect Apple to do whatever makes the most business sense, and not act irrationally; changing suppliers out of spite.
Now, Apple could switch to alternatives if they had to, but they would only consider doing so for good business reasons. Accepting a more expensive chip which uses more power and is lower quality or performance just out of spite isn't going to happen.
Comments
Are you suggesting that a total cost 2.4% of SRP for all patents would be a reasonable amount?
Such an amount would be far greater than the profits from Apple's components orders.
I didn't say any such thing.
I said that 2.4% for each patent is absurd.
Then I said that Microsoft is receiving $5 per unit from Android handset makers for all of their patents - many of which are not FRAND. And FRAND licensing is generally less.
By comparison, I would expect that Apple would pay less than $5 per handset to license FRAND technologies from Samsung - and much of that has already been paid by the chip manufacturers. But even if you choose $5, that's well under 1% of the price of a handset.
Considering that Apple gets a discount for buying components in bulk and paying upfront with cash, would Samsung be better off replacing Apple with a bunch of smaller clients to whom they do not have to offer a bulk discount?
You answered your own question with the statement in bold. The smaller clients aren't going to give Samsung an upfront cash payment. Most of them are going to buy on credit. Also, one customer buying $8 billion worth of stuff is far more valuable than 10 customers buying a combined total of $8 billion.
I agree though that Apple should consider quality when choosing a supplier. However, Apple has shown that they don't fire from the hip. Chances are that if they've chosen to move to another supplier, they've done their due diligence.
It also may well be that the media is embellishing this. Apple is a large customer. They might be trying to diversify component suppliers because one supplier can't make enough for Apple.
You answered your own question with the statement in bold. The smaller clients aren't going to give Samsung an upfront cash payment. Most of them are going to buy on credit. Also, one customer buying $8 billion worth of stuff is far more valuable than 10 customers buying a combined total of $8 billion.
Says who?
First, the $8 B customer is probably paying lower prices than the $800 M customers. Second, most companies intentionally try to diversify and avoid having too many eggs in one basket.
I agree though that Apple should consider quality when choosing a supplier. However, Apple has shown that they don't fire from the hip. Chances are that if they've chosen to move to another supplier, they've done their due diligence.
It also may well be that the media is embellishing this. Apple is a large customer. They might be trying to diversify component suppliers because one supplier can't make enough for Apple.
Of course the press is embellishing. Sometimes simply making things up, as well. That's what the press does.
Absolutely moot. Apple doesn't HAVE to switch. If they can't find an equal alternative, they can continue to buy from Samsung. But Apple has the option to choose someone else. If Apple does so, Samsung loses.
I was responding to LunarMoon's suggestion that Apple WILL ditch Samsung if Samsung wins in court. Either way, I expect Apple to do whatever makes the most business sense, and not act irrationally; changing suppliers out of spite.
Apple uses licensed qualcomm chips.
Apple gives samsung a wink and a nod.
Why are we still talking about this?
Some reports ponder whether reason will prevail:
Report: Apple May Switch to Inferior, Pricier Chips to Spite Samsung
http://www.dailytech.com/Report+Appl...ticle22841.htm
Not likely.
Now, Apple could switch to alternatives if they had to, but they would only consider doing so for good business reasons. Accepting a more expensive chip which uses more power and is lower quality or performance just out of spite isn't going to happen.