Matt is the former News Editor for The Next Web. You can follow him on Twitter, subscribe to his updates on Facebook and catch up with him Matt is the former News Editor for The Next Web. You can follow him on Twitter, subscribe to his updates on Facebook and catch up with him on Google+.
Samsung has reportedly been forced to push forward the launch of its new 20-nanometer mobile memory chips to calm shareholder fears it lost a major contract to supply DRAM chips to Apple.
According to various unnamed Samsung executives, speaking with The Korea Times, the new 4GB ultra-thin memory chips are going to be used in Apple devices, despite reports that its rival had shifted part of its supply chain to Japanese company Elpida.
Digitimes claimed that Apple had placed orders for around 50 percent of the Elpida’s output of its Hiroshima factory, forcing Samsung’s share prices down 2 percent to a two-month low in morning trading, stripping more than $10 billion off its market cap.
Samsung’s press release, which hit earlier this morning, is said to have been scheduled for this coming Monday, but had been brought forward to ease concerns of an Apple-Elpida partnership.
Here’s the key take-away from the article in The Korean Times:
Samsung is increasing the output of mobile DRAMs using a finer 36-nanometer processing technology for Apple as planned. It doesn’t have plans to reduce production of the chips,’’ said another senior Samsung executive in a telephone interview with The Korea Times.
The report from Taiwan is exaggerated. Apple is always looking to diversify its part-sourcing channels. In flat screens and chips, Apple is sourcing parts from various clients that include Samsung, however, that doesn’t mean we are losing our edge as Apple’s top-tier client,’’ said the executive.
The reliability of The Korea Times has been called into question before, with quotes often taken out of context. However, the news outlet does tie official press releases with quotes from what it calls Samsung’s executives, lending a little more credibility to its report.
Apple’s continued reliance on Samsung components is almost certainly down to the Korean company’s reliability and scale. The two companies are currently locked in patent lawsuits around the world but Samsung is one of the only memory makers that is able to fulfil such a large number of semiconductor orders from a large client like Apple.
Elpida may well have secured new orders (it is already an Apple partner), but Samsung isn’t taking any chances. When it comes down to production, Apple will be careful to ensure it can fill its supply chain instead of cutting ties with major partners and threatening the availability of its products.
If true, Samsung’s decision to move forward its launch shows the effect Apple has on the component market. Not even the Korean electronics giant can afford to miss a trick.
Get the TNW newsletter
Get the most important tech news in your inbox each week.