Apple has reduced Samsung’s involvement in chip design, relationship going south?

October 15, 2012
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Apple and Samsung are not exactly in good terms due to patent disputes being lodged in the courts of law around the world. Samsung remains to be the biggest supplier of the processor and memory chips that power Apple’s smartphones and tablets, though. However, that relationship might change soon, as unveiled by a source from within Samsung.

A report by the Korea Times cited a Samsung official as saying that the relationship between the two companies have substantially changed. “Apple … has made it clear it will no longer use its rival’s technology, according to a senior Samsung official.”

The report has also cited an anonymous source, saying Apple is no longer collaborating with Samsung in designing its latest A6 processor chips. Rather, Samsung is now just producing the chips for Apple. “Apple did all the design and we are just producing the chips on a foundry basis.”

This is a change from the two companies’ previous working arrangements, in which both collaborated on chip design and development. Apple is reportedly shifting manufacturing work to other foundries, as well, such as the Taiwan Semiconductor Manufacturing Company (TSMC) or even Intel. And it’s not only in processor chips. Apple might shift orders for other components — including memory, display and Flash storage.

As such, Samsung stands to lose its biggest client, which might either turn to other suppliers or focus on in-house development. Case in point: a key chip architect was reported to have made the move from Samsung to Apple. This, along with Apple’s plans to shift production to other suppliers, might signal that the mutually-beneficial relationship might soon come to an end.

Should Samsung be worried with the prospect of losing its biggest client?

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