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Comment by peoplearepeople | Hacker News Reader

At what point does Apple just buy Samsung?

Given the percentage of Korean GDP for which Samsung accounts, and the political influence they wield, they're effectively a state institution. We can assume they're not for sale, ever.

Samsung is like what happens if Microsoft Office, Microsoft Windows, Microsoft Xbox, and all of these divisions were actually separate companies with a very loose federation underneath the name "Microsoft" even though the real "Microsoft" doesn't have much power over any of the individual members.

As a result, you've got Samsung Display putting screens in iPhones and occasionally screwing over Samsung Electronics which is a completely separate company, that is still within the loose federation (and, due to the unusual legal structure and antitrust concerns, Samsung Display can't offer even the slightest of unfair deals to their own Samsung Electronics group, for example). And on the fringe ends you have Samsung Life Insurance, Samsung Skyscraper Construction, and Samsung Medical.

My favorite recent one is how the mobile division started refusing to use new Exynos chips from the semiconductor division. Imagine if Apple designed and built an A16 chip and then put Qualcomm SoCs in the iPhone.

A while ago I learnt that Samsung made artillery guns as well.

https://en.wikipedia.org/wiki/K9_Thunder

I wonder if it runs bixby.

CPU is i486 and it runs DOS. Also Samsung subsidiary that made it was sold 9 years ago. So no Bixby.

Apple has 57.1% of the US Smartphone market, Samsung has 29.3%, the next competitor has less than 5%.

I know antitrust regulators are mostly asleep at the switch, but they might wake up for that.

(And the US isn’t the only jurisdiction and smartphones aren’t the only market regulators might have concerns about.)

Antitrust laws in US/EU make that unlikely. Maybe they could buy Samsung Display though, if Samsung the conglomerate got desperate enough?

I highly doubt South Korean regulators would approve a sale of their largest single GDP contributor

Yeah. I meant from an antitrust perspective.

They maybe could, but I think it would be pretty unlikely. A lot of Asain companies strive to bring everything in house. Samsung Display is not just for making TVs, but also internal B2B as a supplier for Samsung phones, and such. This allows them to evade or not take as much of a hit by the value added tax I believe? If Samsung sold their display division, they would would then have to pay the 10% VAT on each display to make their phones. Right now, Samsung display can make the screens and they don't have to pay VAT.

My understanding of S. Korean VAT could also be wrong.

Businesses always pay VAT on purchases, and collect VAT on sales, but can reclaim the paid VAT if purchase was done for business purposes. This basically means that the ultimate wholly VAT payer is always the end consumer (person, not business).

So while costs are added on to the customer, it would result in a price raise resulting in lessening their competitive advantage. While they may not eat costs, it may cause them to loose out on potential customers, so they would still feel the VAT, just not directly then, correct?

> So while costs are added on to the customer, it would result in a price raise resulting in lessening their competitive advantage.

Every business that sells goods/services in VAT country collects VAT and transfers it to tax authority. There's no any advantage or disadvantage for someone, everyone plays by the same rules.

To sum it up, businesses "do not pay" VAT (technically they pay, but then reclaim it at the end of the month). All VAT burden always falls on the end consumer. Wikipedia says, that VAT is similar to sales tax, but since I'm not too familiar with sales tax, can't comment on that similarity.

https://en.wikipedia.org/wiki/Value-added_tax

Gotcha, thanks for the explanation!

Even if they could do this they'd probably be forced to stay in the same business as Samsung supplying displays to third parties (e.g. all of the Google Pixel phones have Samsung displays). It's really hard to imagine Apple would want to be in the business of doing display R&D and then selling the technology to competitors.

True.

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