Apple and Samsung, frenemies for life
Poornima Gupta, Miyoung Kim and Dan Levine article for Pinchcreekecho gives a very good overview of the origins and subsequent deterioration in the Apple – Samsung relation.
[quote] Tim Cook, Jobs’ successor as Apple chief executive, was opposed to suing Samsung in the first place, according to people with knowledge of the matter, largely because of that company’s critical role as a supplier of components for the iPhone and the iPad. Apple bought some $8 billion worth of parts from Samsung last year, analysts estimate.
Samsung, meanwhile, has benefited immensely from the market insight it gained from the Apple relationship, and from producing smartphones and tablets that closely resemble Apple’s.[/quote]
The article continued by highlighting:
[quote] The partnership piece of the Apple-Samsung relationship dates to 2005, when the Cupertino, California-based giant was looking for a stable supplier of flash memory. Apple had decided to jettison the hard disc drive in creating the iPod shuffle, iPod nano and then-upcoming iPhone, and it needed huge volumes of flash memory chips to provide storage for the devices.
The memory market in 2005 was extremely unstable, and Apple wanted to lock in a supplier that was rock-solid financially, people familiar with the relationship said. Samsung held about 50% of the NAND flash memory market at that time.
“Whoever controls flash is going to control this space in consumer electronics,” Jobs said at the time, according to a source familiar with the discussions.[/quote]
It’s hard to understand why Apple has not anticipated that Samsung may one day become a fierce competitor. I’ve illustrated in an earlier post – Samsung: Here is Why Apple Should Be Afraid, that Samsung has inflicted maximum damage to Sony and other vendors in the Television industry. This should have sent off a few warning bells at Cupertino. However, these bells appeared to have been heard a little too late.
My only guess is that Tim Cook got seduced by Samsung’s Component division and lost track of Samsung Electronics division.
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