Hacker News Reader

Comment by tzury | Hacker News Reader

Let me figure this out: Samsung manufactures Touchscreen, CPUs and perhaps other chips for Apple, yet Apple sue them from time to time over software patents and design ideas.

Can someone help me understand this?

View on HN

Gigantic multinational megaconglomerates are, well, huge. They may operate under the same overall banner, but operationally they tend to be almost fully independent entities. Many are legally distinct corporations with their own finances, budgets, and operations.

Apple employing the component manufacturing arm of Samsung can occur simultaneously with Apple suing the consumer device design arm.

The current relationship may not last much longer. It's been reported that Apple has signed a deal with TSMC for 2014.

That is a great way to damage Samsung for Apple. Initially contracting them with a very high-volume and then dropping off to zero. Samsung will make a huge net-loss, if they don't partner up with Microsoft(=Nokia now) or Google in another big deal.

I don't think Apple is as interested in being punitive (though some of it might be that) as they are in diversifying supply sources. It's probably unlikely that TSMC will exclusively build them right away, but Apple may shift more over to them if they do a good job.

It's just business. The same thing happened when Apple switched from PortalPlayer to Samsung; their stock tanked and they were bought by Nvidia.

I thought upvotes and downvotes are for moderation. It's so childish to downvote someone just because you're not of the same opinion.

Samsung is actually having trouble meeting their own internal demand for components. IIRC, they were even getting memory from arch-rival Hynix at some point this year. Having Apple dial back might not be such a bad thing for Samsung if it helps sort out their internal supply chain.

Samsung has long sourced externally for parts. Despite being (one of?) the worlds biggest LCD panel vendors many of their TVs had non-Samsung panels in them at least a few years ago. It was particularly the mid-low ranges.

Their Galaxy S4 in the US uses a Qualcomm CPU...

They use Qualcomm anywhere they need LTE, as nobody else has that properly sorted.

Qualcomm CPU, not just Qualcomm LTE module.

Not true, contract component manufacturing made only 7% of Samsung profits last year. The value of the Samsung branded smartphones they ship out is by far their most important financial metric.

Say you sell lumber, and I sell furniture, and buy a lot of my raw materials from you. You start making furniture too, and your furniture seems a little too inspired by mine, maybe going over the line of what's legal, so I sue you. However, your lumber is still top quality despite that, so I keep buying your lumber even while suing you over your furniture.

In your example, 15-20% of your lumber sales are to me, so regardless of what happens with the furniture situation, you still want to keep selling me lumber. It's a symbiotic relationship.

If you've ever worked at a company with more than a single employee, surely you've noticed that not all employees necessarily know what the other employees are doing.

Now imagine that scaled up to a giant corporation, with hundreds of thousands of employees, and multiple independent divisions with their own goals, strategies, and financial responsibilities.

Yes, when you are working with a company and sharing trade secrets only to have them turn around and take those secrets to make their own devices that compete directly with yours and then they make commercials making fun of said products and your customers, that doesn't really help the business relationship.

It can't have hurt the relationship that bad if Apple haven't sourced a new provider. If I were Apple I'd pull the contract on principle but I'm sure financial forces are at play here.

They are doing everything the can to source a new provider. There just aren't that many people who have the manufacturing capacity to produce these chips at scale.

I keep hearing this. What are those 'secrets' that you are talking about (Any link which gives specific information?) Samsung has been making phones much before Apple has been. Are those secrets "Rounded phone corners", "icons in a grid", "Slide to Unlock", or "jumping scrollbar"?

Detailed definitions of the chips they are making and the strategy/prioritizations they use while upgrading them?

If you really think Apple has contributed nothing more to the modern smartphone than 'rounded corners', this is not the appropriate place to ask this question because you risk being mistaken for someone trying to start a flamewar. I recommend quora instead.

Recommend Quora? Remind me to ignore your recommendations in the future.

As for Apple contributions, you should probably check out the lawsuits vs Samsung.

I know where the assertion about the round corners comes from.

Are you seriously claiming that this is all that Apple has contributed to the design of modern smartphones?

Your question seemingly assumes that they contributed 'rounded corners' to the smartphones in the first place.

So are you really saying that apple contributed nothing at all to the modern smartphone?

Samsung does a lot of things. They build ships. The left hand doesn't know what the right hand is doing. Well, it does, but it can't do anything about it. This is a big company.

It's simple, unless Apple aggressively defends their patents, Samsung could easily create very competitive clones of Apple's products.

Companies as big as Apple and Samsung have gotten over their egos in favor of profits. Just because one company is suing the other, in no way prevents them from entering other mutually beneficial agreements.

Which part is hard for you to understand? That Apple has patents that are applicable irrespective of the underlying hardware?

Maybe Apple leveraged some advantageous deal with them in exchange for not suing them anymore

Reply on news.ycombinator.com