Tension rises as Samsung complains about not receiving iPhone 6 chip orders

By , Mar 30, 2013

A6 Chip

Despite the ongoing legal wrangling over mobile technology patents, Samsung to this date remains the only supplier of Apple-designed processors which drive iPhones, iPads and iPods. The South Korean conglomerate has been exclusively building these chips according to Apple’s blueprints at its multi-billion dollar fabrication facility in Austin, Texas.

However, recent chatter increasingly points to rival Taiwan Semiconductor Manufacturing Company (TSMC) possibly stealing the Apple contract from Samsung as Apple looks to further distance itself from its chief rival.

A new report from South Korea alleges Apple has now actually excluded Samsung as a future mobile processor supplier. In turn, TSMC, which is the world’s largest independent semiconductor foundry, may produce a significant portion, even possibly all of mobile chips for Apple’s next-gen iPhone 6 to be released in 2014…

Money Today Network, a Seoul-based broadcasting unit of Money Today, filed a report Thursday quoting a Samsung Electronics official as saying the company has not received an order for 20-nanometer chips from Apple for the next year’s iPhone upgrade , the iPhone 6. As a result, the story notes, internal tension inside Samsung is rising.

The story goes on to assert that TSMC may produce all chips for the iPhone 6, but Korea Investment & Securities researcher Seo Won-seok cautions Samsung is likely to secure about 70 percent of Apple chips in 2014, with TSMC supplying the rest.

This is another important piece which helps complete Apple’s semiconductor puzzle.

iPad mini keynote (Phil Schiller, A6x slide 001)

Unlike TSMC, Samsung, a conglomerate with diverse interests, supplies Apple with chips and other components while also directly competing with the California company on mobile devices.

Author Sam Grobart in a wide-ranging Samsung profile in  Bloomberg Businessweek explains how the Galaxy maker uses its production depth in powerful ways.

It’s been often argued that Samsung’s components arm is separate from its mobile gadget business, with the former being walled off from the latter, with one side not knowing what the other is doing in order not to antagonize its major clients like Apple.

That may not be entirely the case, Grobart notes:

Few people who watch the company think Samsung keeps itself in the dark. New technologies take time to develop, particularly if that technology is needed in large quantities.

“Having that early-stage insight into the supply chain has been one of the key factors to give them an edge,” says Neil Mawston of Strategy Analytics. “They can see three years ahead.”

Also, this:

However the many court cases play out, Samsung wouldn’t have to break the law to use its position as a supplier to its advantage. If a manufacturing customer merely approaches Samsung with a request for a new kind of processor, that information is valuable.

“Having a road map of, say, Apple and knowing what competitors are doing is pretty useful,” says Bernstein’s Newman. “It’s not copying, and it’s not illegal. You just know that in 2013, Apple’s going to need a quad-core processor.”

We previously heard Apple may have ordered a “very large volume” of chips from TSMC as the company reportedly looks to pit Samsung, TSMC and Intel against each other in a bid to have the world’s largest semiconductor makers compete for contracts to build the engine that powers iThings.

Samsung Life-affirming chip in Yongin
Samsung’s apt mission statement on an oversized chip outside its complex in Yongin, a city about 45 minutes south of Seoul, South Korea.

TSMC was recently thought to be finalizing production designs for Apple’s A7 chip. According to the latest chatter, the foundry began pilot production of the A7 chip earlier this month. TSMC should have first prototypes of the A7 package ready as early as in May, with full scale production slated for early-2014.

Another telling sign: TSMC, along with Apple’s contract product assembler Foxconn, allegedly will add 5,000 new jobs each ahead of upcoming Apple product launches, which most definitely will include the iPhone 5S and possibly a rumored budget iPhone.

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  • http://twitter.com/sl0wCydia0101 Cydia is sl0w

    Samsung Sucks!!!!!!!!!!!!!!

    • http://www.facebook.com/joe.jonsen Joe Jonsen

      thank you

      • Kurt

        Looks like you have a boyfriend to agree with you now.

      • Ben

        You’re just as bad as him, honestly, get the f$€k over yourselves. Stop whining about Samsung vs Apple. Please.

  • Peter Sion Dioner

    Well, well,well…

  • Jife66

    “Never bite the hand that feeds you” springs to mind !!

    • WolfgangHoltz

      Tell that to the workers in Austin, bet they are thrilled to hear this. Hahaha

    • http://www.facebook.com/joe.jonsen Joe Jonsen

      never feed the mouth that bights you either lol

  • http://www.facebook.com/zacksloane Zachary Sloane

    I mean, honestly, what did Samsung expect? This comes as no major surprise to anyone right?

    • orthorim

      It’s surprising that Apple was so naive to think Samsung would act professionally and actually keep those business units apart.

      The same thing doesn’t work in tightly-controlled US banks. To expect it from a corrupt copier of products in South Korea is just plain stupid.

  • http://www.facebook.com/khan.rulzz.7 Khan Rulzz

    Dont cry samsung bitch !!!

    • http://www.facebook.com/joe.jonsen Joe Jonsen

      yeah they should be happy cause now that can focus on their crappy Sphones

  • http://twitter.com/int3nsive Int3nsive

    Finally.. well done Apple…well done!

  • http://twitter.com/TonyLonsway Tony Lonsway

    Great news! Nice work Apple

  • http://www.facebook.com/tafk1 Taf Khan

    So Samsung crying because Samsung No Copy No More.. .

    • Stanley Traub

      I’m sorry, but what exactly did Samsung copy? As far as i know it is Apple that is copying everyone else and calling it “innovation”

      • Kurt

        If Apple was smarter, they would be copy even more from Samsung. The Note 3 will be my future phone because of innovation. Samsung innovates like no other company. They deserve my money.

        Btw, Samsung copied the rectangle. They should have made the triangle phone I guess?

      • Stanley Traub

        LOLOLOL +100000000

      • Raj

        Again, please do not say Samsung innovates. I feel shame about that.. Sorry you should feel shame about that.

      • http://twitter.com/int3nsive Int3nsive

        Seriously? you were living in what planet? here’s the incomplete list
        9gag com/gag/5215322

        And those are only from Apple, because some people doesn’t know but Samsung also copied a lot of other brands. They do not deserve any respect at all, as a brand company. They deserve respect, ONLY, as a manufacture. But since they betrail their clients, they don’t deserve any respect at all…

        Samsung innovation were? They use Android, they don’t even own the OS that they use! They copy all the UI from other brands , and are the last one to pull out some real innovation. Apple was the first that used RETINA DISPLAY and the irony is that Samsung build screens and was not the first one. They pulled out the AMOLED, people realized that the quality sucks and they bring back again the OLED… now, how ironic it is…

      • Stanley Traub

        MY GOSH! the RETINA display! Omg! Its marketing u dumbass! Spec wise the full hd OWNS it. Blind follower much?

      • http://twitter.com/int3nsive Int3nsive

        The way you talk, clearly we all know how is the dumbass here. The sound of fandroid butt hurt it’s clear on your reply.

        Better image quality without noticing the pixels and without decreasing the aspect ratio size it’s cleary “marketing only”. Omg, how could people fall on that “marketing”.

        Btw, did you liked the link? I bet you didn’t. I guess why…

      • SoCoMagNuM

        “Your” way to emotionally attached to your phone lol

      • Kurt

        He’s a “progressive” troll

      • http://twitter.com/int3nsive Int3nsive

        For people like you and other fandroids, who are always in denial and can’t handle the true… sure, i’m the troll. please don’t forget to mention my bad grammar too. it’s always important…

      • http://www.facebook.com/tafk1 Taf Khan

        Takes one to know one right Kurt? :P

      • http://twitter.com/purpledodi Jens Tinnerholm

        Retina is just an ips panel for the screen btw. It looks good indeed. But its just ips

      • Yacko

        This is for you and Kurt below. For the Galaxy Note series Samsung copied the Apple Newton, which is 17-18 year old technology. Samsung’s motto should be “Innovating into the past”.

      • http://www.idownloadblog.com/author/dujkan Christian Zibreg

        If I’m not mistaken, Samsung’s ripping off of the iPhone and infringement of patents has been established by the court last August. So let’s not pretend like they did not lift Apple’s work, shall we?

      • Stanley Traub

        Name one plz? :-) oh THAT patent! That the phone is in the shape of a rectangle! DANG… they should have made a triangle phone!

      • orthorim

        He’s not talking about any patents. We’re talking about a 130 page document where Samsung engineers compare an iPhone to a Samsung phone feature for feature and on about 80% of them “recommends” to do it the way the iPhone does.

        If that’s not copying then what is? That document is public. Google it.

  • mhchehade

    The war has just begin

  • f5faith

    Reap what you sow, Samsung. Lets see how well your company actually does without the massive surplus from Apple’s component orders.

    • WolfgangHoltz

      Yea, And let’s see how well Apple do as well.

      • http://www.facebook.com/joe.jonsen Joe Jonsen

        lol @ YOU being MAD

      • WolfgangHoltz

        Yes because it’s gonna be some sad faces in Austin when the jobs disappears. But who cares, there is plenty of jobs in Austin.
        Come On let’s make Asia No 1 economy in the world.

      • orthorim

        Well I think they should team up with Intel and put some factories in places.

        It’s obvious you can’t give your biggest competitor ALL the details for your next products year after year…

      • WolfgangHoltz

        Until now not much new from Apple only little faster CPU and a bigger screen on the latest model, like all the other competitors.
        And now they talk about Steve was involved in the design in the next model?? Are they serious the guy been dead for almost two years now. What does this mean next model is from the past.

  • http://www.facebook.com/joe.jonsen Joe Jonsen

    apple needs to cut all ties with that crazy company samsung

    • Kurt

      (as you often say) “You mad bro?”

    • orthorim

      I am sure they’d just love to; but as always at Apple, the product comes first and if nobody else can produce, say, retina screens in quantity then Samsung it is…

  • lrd555

    If I were Apple I’d copy Samsung for a change and start making say 42″ SmartTVs. Not to make billions; but directly disrupt Samsung’s weak margins in this vulnerable sector. If Apple could sell one of every 15 or so 42″monitors it would put real hurting on Samsung. And if could sell one of every 10 or better; it would have them reeling. Why not use the brand to make your point?

    • http://twitter.com/int3nsive Int3nsive

      Apple doesn’t need to copy the smart tvs. Apple only need to make it better, that’s all. They will outsell Samsung if they do that, for sure. Copying all products from their rivals is for low companies like Samsung. I hope that Apple never fall on that mistake.

  • RarestName

    Didn’t people say that Apple’s orders from Samsung are not affecting them?

  • Kurt

    So LCD screens, and processors made by inferior companies is a good thing? You people are idiots. I want my iPad 5 to have as many parts by Samsung as possible. Stop taking things so personally. You are not Apple (which is a non-living entity by the way). Morons…

    • http://twitter.com/jdogg84able Jdgg84

      You arent Samsung either ass clown.. riding peoples nuts on an iphone blog? that takes an awesome life! LOL

      • Kurt

        Pervert, I didn’t bash Apple. I clearly said I want my iPad to be superior to what it now will be with inferior parts. You are clearly one of the morons I was talking about. Read someone’s comment two or three times before commenting. You’re pedophile mind works slow

      • Stanley Traub

        +10000000000000

      • http://twitter.com/int3nsive Int3nsive

        iPad has inferior parts and does the job better than all Android devices out there, with the so called “better specs”. Now Tell me…do you prefer having “nerd numbers” or real results?

        I know it’s hard to belive (specially for nerds) but numbers doesn’t represent quality at all. iPad deliver quality, it’s fast and just works. It the point. He was designed to serve people, not to brag about how good specs he have but doesn’t make the job very well, like all Android tablets out there. And windows tablets are a huge mess, because it doesn’t matter having a “full OS” if all apps are not designed for 100% finger usage. Remember, that was one of the reasons why Microsoft failed on tablets, before the iPad.

        Tablers with x86 and other ARM tablets, with apps totally incompatible.. it’s crazy and specially for people who doesn’t understand tech, get crazy why “they have windows and can’t install some apps, designed for Windows…”

      • Kurt

        Guess who didn’t read all that troll crap you just wrote…ME
        haha

      • http://twitter.com/int3nsive Int3nsive

        Off course not. I’ve totally forgot that you’re a butt hurt fandroid over here. My bad.

    • http://www.facebook.com/profile.php?id=1849765376 Jordan Rushing

      Precisely. These people are completely incompetent…Samsung makes the iPhone as fluent as it is. Software always plays second fiddle to hardware. Samsung is an experienced and professional chip maker. To drop Samsung and it’s internal hardware is more like starving yourself more than biting the hand that feeds you…

      • Kurt

        Exactly. And much more well said. LG is known for making very good LCD screens for TVs, but their screens for TVs and for iPads have been inferior to Samsungs. Before Apple started suing, people wanted to get the iPads that were made with Samsung screens. Now all of a sudden, less of Samsung is better? Short sighted idiots.

      • orthorim

        I’d love for that to not be true anymore but I just got the LG panel in my retina MacBook Pro replaced. Got a Samsung panel by chance and it’s just much sharper. Definitely better.

      • http://twitter.com/int3nsive Int3nsive

        “Software always plays second fiddle to hardware”

        No, just no. That kind of thought is what makes Android badly optimized compared to iOS. Samsung has, for sure, great quality on internals but there’s a lot of great hardware makers too, that only need the boost (money) to hit that quality, like Sharp for example. Apple actually design a lot of specs and only oder that specs to Samsung. What they can make is exactly the same thing with other manufacturer, asking them the same quality parameters.

      • http://www.facebook.com/profile.php?id=1849765376 Jordan Rushing

        How droll. So I’m still wondering why iPhone now doesn’t have single core anymore if if the software is that great…why would you need dual core or quad core if both are optimized? Illogical. Regardless of the reason Apple upped the cores, it was only to help help he current level if software run the way it does now. You ever try running Windows 7 on a computer from 10 years ago? Hardware can’t handle it. Unless it’s optimized to run it.

        I stand by what I said…and I don’t deny the capabilities of other manufactures. I’m just saying I liked the Samsung internals in my phone…which is why I use my iPhone. Heheh.

      • http://twitter.com/int3nsive Int3nsive

        iPhone 3GS and iPhone 4 are both single core and both have iOS 6.1

        Hardware improvements it’s always important, but more important than that is having a software that takes full advantage of that. iPhone 4S and iPhone 5 have better specs to handle more features and better aps, and most important, to be ready for future iOS updates. Yes, Apple still guarantee at least 3 years of iOS updates.

        Now on the Android side, I always see great specs being blocked for new updates to make them sell more devices. Because brands like Samsung don’t earn money with the OS like Apple, so they need to make their devices with a lower lifespan. I remember people talking about the first Galaxy S, saying that was better than the 3GS and guess what? the 3Gs and iPhone 4 are still here… the Galaxy S was totally forgotten.

      • http://twitter.com/ningamoh mohamed ahmed

        it is all about price

      • http://www.idownloadblog.com/author/dujkan Christian Zibreg

        Actually it’s the interplay between iOS and hardware that makes the experience fluent, not the chips themselves. My S3 has a quad-core processor – built by Samsung – and yet the user experience is choppy, jerky and not nearly as smooth as the iPhone. So speeds and feeds matter but only to a certain extent.

    • Stanley Traub

      Aw.. no surface pro? I just saw it at best buy and that thing is a BEAST. But yea these people really need to realize that Apple really couldn’t care less about their opinions of the company.

      • Kurt

        Surface Pro is great since it is a real computer. But I’m looking to buy a tablet, and use tablet apps. And iPad has the best tablet apps. But I sure do hate iOS. Terrible OS.

    • orthorim

      Well… that’s the reason Apple is _still_ using tons of Samsung components. Apparently the others can’t make ‘em as good.

  • 笑傲江湖

    狗咬狗

    • http://twitter.com/YzMENTALzY YzMENTALzY

      Yeah great point… Makes alot of sense … * facepalm*

  • http://twitter.com/scheerschuim Marc

    Always enlightening the remarks here

  • wswalex

    Samsung should be affraid now.. North Korean leader use imac.. so maybe first target is that factory whahahahha

  • http://www.facebook.com/Akshaydoiphode05 Akshay Waitforit Doiphode

    wow all these iphones run on samsung , bravo!

    • Mike

      Apple uses Samsung because Samsung knows what they are doing with hardware. That is why Apple has used them for so many years since at least Iphone started. Now that JOBS is dead the grave is also being dug for Apple. Apple will become what it was prior to JOBS return to straighten out the company. Without JOBS the company is going to fail again without a Knight to come save it. Apple is very proprietary and this one word could be the downfall of the company. I will never drink the Apple Cool-Aid as 36% of the smart phone market has. Yes only 36% is owned by Apple. Over 50% is Android and that is because it is better. But you can’t tell that to the Apple cool-aid sipping market. Android is tops for now but remember Microsoft has jumped into the market and OS Hardware and all. They may not have the share of the market BUT their Phones OS tie into the Tablets and PC. This makes for a very interesting mix. It will be interesting how the market changes as the changes occur. Companies will fail, OS’s will die and equipment will too disappear. The only consistent thing is innovation and the benefits we all gain from these innovations.

      • http://www.facebook.com/Akshaydoiphode05 Akshay Waitforit Doiphode

        i love android man , here in india i have xperia z , which is cheaper and way better than iPhone!

  • pauleebe

    Samsung will have a rough year between $1 Billion in litigation and a huge component revenue cut.

  • http://www.facebook.com/jay.albenesius1 Jay Albenesius

    People here just dont seem to get it here Apple needs Samsung and Samsung needs Apple

    • http://www.idownloadblog.com/author/dujkan Christian Zibreg

      That’s just not true. samsung is one of Apple’s suppliers of components and that’s it. there’re plenty of other suppliers that can deliver screens, flash memory etc to apple’s exacting standards. And Samsung isn’t the only semiconductor maker. these things take time, you just can’t start building chips elsewhere overnight. but rest assured apple is moving its business away from samsung. why would apple want to give samsung’s chip making arm an early look into the next iphone’s processor, for example? samsung is a components provider, but also a phone/tablet/computer maker and a lot of other things, which creates conflict of interest.

  • SoCoMagNuM

    The problem with this generation is that to many people are so emotionally attached to their phones their losing grip on reality and what matters the most. Technology is a nice gimmick in life but remember we all existed before it. iPhones are great phones (I know ive used them for years) and my newest galaxy s3 is a great phone in its own way as well. Idk why people have to continuously bicker on which ones best. The only one thats BETTER is based on preference. Thats it in a nutshell. Yay iPhones Yay Galaxys. Yay for technology.

  • Tom

    Samsung has the best cell phones not like kids toy iphones