Disgruntled iPod also-rans accuse Samsung of ‘damage’ by selling Apple cheap NAND flash memory

“Samsung Electronics has denied industry accusations that the company damaged Korean firms by supplying Apple with extremely cheap NAND Flash Memory for its new iPod Nano MP3 player. ‘There was nothing unfair about the businesses with Apple,’ the CEO of Samsung’s semiconductor division, Hwang Chang-kyu, said Wednesday,” Digital Chosun Ilbo reports.

“A Samsung executive said the Flash memory supplied to Apple was of the new MLC type. That is 30 to 40 percent cheaper than the type used by Apple’s disgruntled Korean competitors, allowing the U.S. firm to outprice them. ‘The price difference may seem magnified since the only demand at the moment is from Apple,’ he added. ‘It’s true that the company that has the largest market will have the edge. Buying 100 units and buying one can’t be same.’ He said it was difficult to satisfy all customers and win the market at the same time,” Digital Chosun Ilbo reports.

Full article here.

Advertisement: Apple iPod nano. 1,000 songs. Impossibly small. From $199. Free shipping.
Economy of Scale: Operational efficiencies gained from increased production, thereby reducing cost per unit. Just another reason why iPod dominates world markets.

Related articles:
Apple’s iPod nano forces price cuts on flash-based MP3 players in Taiwan – September 15, 2005
Apple’s music competition having tough time and the iPod nano won’t help them – September 14, 2005
Piper Jaffray: Apple seeing high demand for iPod nano – September 14, 2005
Apple iPod nano 32GB possible in second half 2006? Samsung unveils new flash memory NAND chips – September 12, 2005
Also-ran MP3 player makers miffed by Apple’s impossibly low price for iPod nano – September 09, 2005
Apple introduces iPod nano – September 07, 2005
Apple stomps competitors in flash-based MP3 player market – September 02, 2005

29 Comments

  1. This applies to computers, as well. Apple has demonstrated a clear willingness to lower prices, as long as sales justify doing so. If Macs keep selling more strongly, I see lower prices in the future.

  2. Yeah, Us Mac users have had to pay a premium for our computers for all these years because of relatively low volume Mac sales.. You haven’t heard us complaining.. Have you? ” width=”19″ height=”19″ alt=”smile” style=”border:0;” />

  3. Nah, many other PC manufacturers do it too. At worst, it is a bit sneaky. I do wish they would clearly post the specs on the outer box at least.

    For example, I bought a Western Digital HD recently that said 120GB on the box, but when I opened it up, it actually had a 160GB inside along with a card saying I had received an upgraded drive for no extra charge.

  4. once upon a time there was an expression:

    “Cornered The Market”

    Apple has cornered the market on digital music players. They’ve done so in a relatively short period of time. It makes them the proverbial 800LB gorilla in the product space.

    Jobs is sitting in Cupertino rubbing his hands together, rocking back and forth, saying, “I’ve got all the tunes! I’ve got all the players.”

    Enjoy it while it lasts, because the industry won’t allow it forever. Either songs on iTunes will go up in price or Apple will start licensing FairPlay to competitors.

  5. LOL “Mac mini Update” you’re the only person I’ve ever heard say that it’s a rip off to get more than what you thought you were paying for. Those are the kinds of surprises most people would like!

  6. Tim, it’s only a rip off if you happen to get the old box with the old machine and then cannot exchange for the new one…

    I suppose if you wait a few weeks all the old inventory will be cleared out, but it is still a strange tactic.

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