Who Else Feels the Apple/Samsung Verdict?

One reviewer of Samsung's Galaxy Note 10.1 griped that {complink 4751|Samsung Electronics Co. Ltd.} has too many Galaxy products, all of which will likely be affected by last week's US court ruling that Samsung infringed on {complink 379|Apple Inc.}'s patents.

So far, the ruling has not included an injunction preventing Samsung from selling its products in the United States. If that should come to pass, Samsung will either have to call a temporary halt to sales (unlikely) or quickly redesign its products (more likely). The impact on Samsung's suppliers would be negligible unless suppliers are designed out of the newer products.

An IHS teardown of the Galaxy Note 10.1 lists the suppliers to the device and notes that these same suppliers and products show up in other Samsung devices.

Samsung has been able to save costs by leveraging its relationships with suppliers as well as utilizing vertical integration, the researcher says. Starting with the priciest components in the Note, leading suppliers are:

  • Samsung Mobile Display
  • Samsung Semiconductor
  • Samsung (batteries)
  • DAP Corp.
  • Intel
  • Murata
  • Wacom
  • Atmel
  • Skyworks
  • Winbond
  • ST Microelectronics
  • Maxim
  • Silicon Image
  • Doestek
  • Wolfson Micro

If Samsung can maintain its price point on the Note, it will command a higher profit margin that Apple's iPad. Andrew Rassweiler, senior director of teardown services for IHS, said:

Samsung is a behemoth in the electronic industry and its competitive strength lies in its control, via internal sourcing, of a large percentage of the components that go into its final products. This allows Samsung to keep costs down, while delivering competitive differentiation. The company's internal sourcing strategy is certainly in evidence in the Galaxy Note 10.1, where Samsung supplies the memory — both flash and DRAM — as well as the core processor, battery and many other components.

6 comments on “Who Else Feels the Apple/Samsung Verdict?

  1. prabhakar_deosthali
    August 28, 2012

    Even if Samsung is barred from selling its products ( related to patent infringement) in US, It has a strong hold over the fast growing asian markets ,the market size of which is in my opinion far bigger than the US market.

    Coupled iwth that is the Samsung's ability to redesign products to avoid further patent infringment, will keep  the Samsung brand as strong as it is today

  2. SP
    August 28, 2012

    Patent infringement case was a very interesting one. Especially the argument given by both the parties. Was not surprised that Apple won. I think they had the facts right and their case was stong. I feel good for Apple.

    August 28, 2012

    $1B + award.  I imagine Samsung will appeal and it wil stay in the courts for years to come.

  4. bolaji ojo
    August 28, 2012

    Samsung is likely to ask for expedited hearing of its appeal. Even then, it may take a minimum of six months for the case to finally make its way to the Appeal Court and then several more months before a ruling is issued. Of course, that won't be the end. Whichever party wins would most likely find itself back in court because the losing party would appeal the verdict to the U.S. Supreme Court. It ends there.

    By that time, the market would have long moved on. The issues would be blurred and consumers won't be impacted the way people think they might be because the two companies and rivals are taking steps to modify their products already.

    Apple has been adamant about protecting its intellectual property and others are adopting its hardnosed strategy. This is only one of many battles ahead.

  5. Barbara Jorgensen
    August 28, 2012

    Apple has indeed asked for the injunction as expected. It is in Samsung's best interest that the appeals processes stretches out as long as possible to give Samsung (and others) time to develop new products, as you point out. The other businesses affected, I think, would be the carriers. Go to any Verizon or T-Mobile store and you'll see a lot more Samsung models than Apple models. Anyone know exactly how the carrier-hardware relationship works?

  6. Himanshugupta
    August 28, 2012

    I think that it will be better for Samsung to close this chapter as soon as possible because the jury has favored Apple. If i think as a customer then buying an Apple product will give me more satisfaction due to its seemigly original tag. Consumer psychology can hurt Samsung more than just 1B+ loss.

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