Samsung tied in fight with Apple over supply chain control as only 10% of Galaxy S4 units have Exynos chip

Samsung tied in fight with Apple over supply chain control as only 10% of Galaxy S4 units have Exynos chip
The Samsung Galaxy S4 has become the fastest selling device for the company as it is about to sell in 10 million volume less than a month after launch and to secure stable supply the company is now getting tied in a huge fight with Apple over supply chain control. And while just months ago Apple grabbed the majority of smartphone profits, Samsung has almost evened it out, and the two took 100% of the profits in the industry last quarter.

To secure it can continue making enough Galaxy S4 phones and meet user demand Samsung is now buying more components than ever and the next huge battle between the industry’s two giants might not happen in courtrooms but with suppliers.

"The next round of the post-patent battle for them will be over component supplies," NH Investment & Securities analyst Lee Sun-tae said. "Who wins access to the best performing components in class in large quantity - that's the key ... and explains why Samsung is shopping for components more than ever."

Samsung manufactures a lot of the components for the Galaxy S4 including the AMOLED display, memory chips, battery and its core, the Exynos 5 Octa processor. However only one in ten Galaxy S4s ships with the Samsung-made Exynos chip. The remaining overwhelming majority of S4s actually runs on the Qualcomm-made quad-core Snapdragon 600 chip (including the US version of the phone). Qualcomm is a major Apple supplier.

But that is not the only conflict of interests. Apple’s traditional LCD supplier Sharp is courted by Samsung and rumor is the Korean company placed orders for Sharp displays for Galaxy smartphones last year but cancelled it later on. Samsung is also using Sony image sensors, NAND memory from Toshiba and Corning Gorilla Glass, all components that Apple also uses in its mobile devices.

That outsourcing of components, though, has the downside of Samsung using its differentiation factor. It bet on flexible displays promising to roll out bendable screens by the end of 2012, but that turned out too ambitious and now, one year later, the company has no schedule for flexible screens and has officially denied the Galaxy Note III would have such a display. LG on the other hand is promising a device with a flexible screen by the year end.

There is one thing in this whole situation Samsung understands very well and it is how its smartphones business quickly became a core driver of profits and is now spending more on marketing than research and development. So far, that’s working out great, but the competition gets tougher by the day.

source: Reuters



1. SonyFindOneDroidple

Posts: 865; Member since: May 11, 2013

Smartphones' hardware now is becoming very similar thats why

2. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

When will this competition end? Don't they ever get tired of fighting?

4. dsDoan

Posts: 235; Member since: Dec 28, 2011

Of course it won't end. They have products competing for the same audience.

26. hung2900

Posts: 966; Member since: Mar 02, 2012

Yes. Cocacola and Pepsi have fought each other for about 100 years


Posts: 4851; Member since: Apr 13, 2012

Pepsi tastes better than Coke, just like Apple is Coke, and Android is Pepsi. Coke is a hype! ®

34. Daftama

Posts: 641; Member since: Nov 03, 2012

Lol o definitely got use that in my sales pitch haha

37. Jillxz

Posts: 149; Member since: Jun 04, 2012

Troll no way. Cocacola is better than Pepsi and Android is Cocacola.

7. _Bone_

Posts: 2155; Member since: Oct 29, 2012

Competition is the best thing for the end-user, because companies are forced to come up with bigger and better things. It's a great thing for us.

9. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

Yes, this competition can go on, but they're having an unfair competition, they're suing each other. Why can't they have a fair competition?

17. _Bone_

Posts: 2155; Member since: Oct 29, 2012

I'd probably sue in their position, Apple spent top dollar to buy out the US Patent Office, and like any company, they want what they paid for. Samsung would do the same thing if they jumped the patent gun early, so would every other company, including mine. This. Is. BUSINESS!!! Shady it may be.

22. darkkjedii

Posts: 31541; Member since: Feb 05, 2011

Bone that was a very good and true's big business.

10. chocolaking

Posts: 495; Member since: May 22, 2012

Apple FTW!

18. anywherehome

Posts: 971; Member since: Dec 13, 2011

Just for kids and olds are outdated iConboards appropriate :-)

15. quadrazeus

Posts: 359; Member since: May 03, 2013

So how does it feel after losing respect in lightjedii's eyes?

3. twens

Posts: 1182; Member since: Feb 25, 2012

All we want is top notch hardware and software with a decrease in price. We consumers want good products that cost less. Which ever company satisfies us wins. May the battle continue. Lol

5. InspectorGadget80 unregistered

Apple will be taken down by Samsung no matter what with its marketing strategy. Still sucks our u.s version don't have the Exynos chip


Posts: 4851; Member since: Apr 13, 2012

well Saïd, very true *+1 Apple down south*®

6. _Bone_

Posts: 2155; Member since: Oct 29, 2012

The 10% Octa is not really a supply issue but a scheduling one, the final A15 Octa is simply isn't ready yet as the first-gen found in the I9500 is NOT fully functional big.LITTLE. So the first phone officially to launch on the tech as it is intended will be the Note III, and I don't expect supply issues for that. It's probably 10% for the S4 so all resources could concentrate on that device, and it will be a monster phone. But the Snapdragon 600 is more than a just a strong wolf, it's a smaller tiger itself.

8. gaurang

Posts: 94; Member since: Nov 16, 2012

apple jelous


Posts: 4851; Member since: Apr 13, 2012

Apple will spend what ever it takes, cause it was steves last dieing wishes, that will never ever come true GOD BLESS SAMSUNG FTW®

23. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

I think Sammy understands the invest in marketing concept better than Apple. Otherwise, Apple would be out-spending Sammy on marketing. Steve was very stingy with his cash, and it seems the culture of stingy-ness lives on.

24. darkkjedii

Posts: 31541; Member since: Feb 05, 2011


12. sinple

Posts: 132; Member since: Nov 04, 2011

company that supply both apple and samsung have the last laugh

14. verbalize

Posts: 150; Member since: May 03, 2013

Samsung will fail like all other Manufacturers. Once you drink the Kool-Aid they have your money the quality goes down hill. Low grade plastic cases, Glitchy operating system , and very little innovation. What a waste of plastic... So now they'll put their money into advertising and the quality goes out the window. And the suckers will continue to buy until they wake up and find out what they bought is garbage .

16. InspectorGadget80 unregistered

Are u just another teen on this website hater?

19. HASHTAG unregistered

Well he does have a point. Like Apple, went from glass to some cheap aluminum material.

20. nobelset

Posts: 270; Member since: Oct 17, 2012

Glitchy operating system? What are you, from 2008? Lol plastic is a lot more comfortable to hold than an aluminum one. Unlike you, we don't really care what others think about our phones. All we want is a beast with a powerful processor, sd card storage, removable battery, (s note for galaxy note), Amoled and an open operating system.

29. tedkord

Posts: 17456; Member since: Jun 17, 2009

Keep repeating that until you convinced yourself and can finally get as good nights sleep.

30. darkkjedii

Posts: 31541; Member since: Feb 05, 2011

I read your comment till you said very little innovation. Saying Samsung has very little innovation, is like saying Shaq has very little feet.

21. Loubielou

Posts: 603; Member since: Jul 11, 2012

O.k we were pleased that Apple joined the Smartphone market,but they are a Company who does not like Competition,they think they are Supreme,but now they are acting like Babies,an Why can"t they join the Tennis market as they just love going to"Courts"

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