After a major victory in the UK courts, Samsung has hit Apple where it really hurts by raising the price of the processors they supply to the US Company for their iPhones and iPads by a whopping 20%.This year Apple will buy 200 million processors from Samsung, up from the 130 million they purchased last year. According to a recent teardown analysis from IHS iSuppli, the iPhone 5 costs Apple approximately $207 to produce. The new A6 processor is $17.50 – up from $15 in the iPhone 4S.
The problem for Apple, who has a contract with Samsung untill 2014, is that Samsung is the largest producer of processors for Apple and there are very few alternate suppliers.
Despite the two companies battling it out in courts around the world over patent issues, they continue to rely on each other when it comes to components: Samsung is one of Apple’s biggest suppliers, while Apple is among Samsung’s largest customers.
PC Mag claims in September, it was reported Samsung memory chips would not be inside the first shipment of new iPhones thanks to a fight over price.
Also, just last week, rumors surfaced that Apple gave billions of dollars to Sharp, a financially struggling supplier of iPhone components, as part of an effort to avoid having to rely on Samsung for display components.
Samsung Electronics and Apple’s South Korea office declined to comment on the report.
