Whilst Apple is seeking to dominate the market by suing all the competition over petty design patents, Samsung is hitting Apple where it hurts. Chip supply.
The patent war between Apple and South Korean company, Samsung, still wages with Apple claiming that the Samsung Galaxy phones and Galaxy Tablets infringed on design patents held by its iPhones and iPads. Back in August of this year, Apple was awarded victory in the US courts which ordered Samsung to pay $1.05bn (£644m) worth of damages. Here in the UK however, Apple lost to Samsung as the judge claimed that Samsung’s products “weren’t as cool” as Apple’s counterparts, ruling that Apple should display a message on their website, stating that Samsung did not steal their ideas.
In what appears to be a backlash by Samsung, MarketWatch reports that Samsung has raised the price of their chips which are in every iPhone, iPod and iPad by 20%. With Apple tied to a contract with Samsung which lasts till 2014, there is not much Apple can do. With Samsung supplying roughly 130 million processors last year and an expected 200 million this year, it is a big chunk of money. Time will tell if Apple will transfer this cost across to its products and customers or if they will just make it back by continuing to chase patent infringements.
It is most likely that we will begin to see Apple phase out the use of Samsung chips over the next 24 months and begin to use different suppliers whilst Samsung can concentrate on developing their own products.