A few days ago it was reported that Samsung had decided that Apple would have to start paying 20 percent more for the mobile A-series chip processors used in its iPhones and iPads. Now, the Street is confirming that a Samsung official has denied these claims.
According to the Street:
After reports earlier in the week that the South Korean technology giant was raising application processor (AP) prices on Apple by as much as 20%, a Samsung Electronics official denied reports to The Hankyoerh, a Seoul-based newspaper.
Concerning the rumored price increase, the unnamed Samsung official reportedly confirmed that “prices are set at the beginning of the year and aren’t changed easily.”
Needless to say, Apple and Samsung have had a tumultuous relationship lately. When CEO Tim Cook was asked about its relationship with Samsung in LCDs, Cook responded with: “And Samsung, we continue to be a customer of Samsung and continue to have a commercial relationship.”
While Apple and Samsung have contracts that keep Samsung supplying at least some parts to Apple until 2014, analyst Gene Munster thinks “Apple may shift production to another vendor (TSMC has been mentioned in various news reports), but in the meantime, they appear to have no other avenue.” At least they won’t have to worry about a 20 percent increase on their processors.
We should keep in mind that the Street’s informant goes unnamed and could be someone entirely unfamiliar with the inner workings with upper management. That said, we would be plenty surprised if Samsung decided to sporadically increase its pricing on its processors.