The iPhone X proves Apple and Samsung are frenemies
As Apple gears up for the release of its hotly anticipated iPhone X, its rival Samsung will be quietly rooting from the sidelines.
That’s because the South Korean tech giant, Apple’s archenemy in the smartphone market, stands to make more money from the parts it makes for the iPhone X than from the parts in its own flagship smartphone, the Galaxy S8.
Samsung’s components division is the exclusive supplier of the iPhone X’s new, high-resolution, battery-efficient OLED screen, as well as of its memory chips. As such, it stands to make about $110 from each unit sold, the Wall Street Journal reported Monday.
Samsung’s components unit, meanwhile, gets $202 for each Galaxy S8 from the company’s smartphone division. But the S8 will move 50 million units through summer 2019, while the iPhone X will move 130 million, according to a forecast by Counterpoint Technology Market Research.
This means the iPhone will put a full $4 billion in revenue more into the Samsung components division’s coffers than its flagship phone.
Apple’s demand for Samsung’s smartphone parts is vital for the South Korean company, which sees 35 percent of its revenue come from its components business.
In fact, when visitors to Samsung’s headquarters bashfully take out iPhones, Samsung executives say “it’s OK. They’re our best client,” according to the Journal.
Apple, however, would prefer that its nemesis not have full control over the fancy new screens it puts into its top-tier phones.
Reports indicate that the Cupertino, Calif. company is pushing other suppliers to expand their OLED production so it can diversify by 2019 at the latest. The screen, which is making its first-ever appearance in an iPhone, is notoriously difficult to manufacture, and has reportedly contributed to the production issues plaguing the forthcoming phone.
Apple is reportedly considering going into business with Japan Display, who claim to have the technology to create a high quality, edge-to-edge LCD display. Other reports suggest they are looking to develop their own OLED equipment to license to trusted manufacturers.
For now, though, Samsung will be content to watch Apple fanboys line up at stores around the country before the iPhone X’s Nov. 3 release.
Post a Comment