“The iPad 2 is still hard to get, both in the U.S. and in other countries where it has launched internationally,” Darrell Etherington reports for GigaOM. “Luckily for would-be buyers, Apple is taking steps to reinforce and supplement its existing supply chain in order to be able to move more iPads more quickly.”
“In order to boost iPad supply, Apple is reportedly taking on a new supplier of displays for the tablet,” Etherington reports. “According to the Taiwan Economic News, AU Optronics Corp, which is the world’s fourth-largest LCD maker by volume, has been contracted by Apple to provide flat panel screens for the iPad 2.”
Etherington reports, “This would mark the first time Apple has used AUO for iPad supplies. The report also says the rate Apple will pay for the displays is roughly three or four times the average rate paid by others for displays of the same size. It’s possible AUO was able to negotiate a very favorable rate in order to guarantee a significant percentage of AUO’s total output capability.”
Read more in the full article here.
[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]
Doubtful, most Taiwanese OEMs are dying to become an Apple supplier. If they charge exhorbitant rates, then Apple will drop them as soon as they can.
Odd that a company with enough sales volume to name its price would go for this. Doesn’t sound like a Tim Cook move to me at all. I don’t believe it’s true but instead is probably underhanded manipulation of that company’s stock price by some fund manager.
It’ll rise by several points today and tank by Monday.
It’s pretty simple.
Apple is taking drastic measures to make iPads and get them into retail as fast as possible.
They know they are losing revenue because of the lack of supply.
This is why apple is doing this.
Customers want ipad 2s and apple just can’t makethem fast enough.
If this situation extends beyond afew months this will damage their international brand equity which may effect the share value.
How much revenue could they be losing with little to pathetic competition? Check the facts… do Ferarri , Rolls Royce or Lamborghini loose panache when they have back log orders? Puhleeze, betah check yo self before you wet yoself.
Loosing to xoom and samsung ….. Poster is correct Apple wants to get as many iPads into as many hands as possible, even if they make X Less per unit ….
Apple wouldn’t take on a new supplier’s products at gun to the head prices. That would be far to risky and an unacceptable qc gamble.
Letmeget this right. Isupplisays ipad2 display costs $127. Four times this is $508. Add $200 in other parts you have $708. Apple will lose $100 per iPad. Incredible planted lie by WS SHYSTERS to get ahead of the real story which is- apple has no supply problems and is ramping up iPad production to 18 million per Q. By lying apple’s costswill rise astronomically they mitigate the astronomical rise in sales.
yeah paying 4 times price makes no sense.
if supply is really under constraint it would be financially better for apple to just delay shipping times than to have cost rise so much. Apple doesn’t really face competition that can jump in if apple delays: most if not all rival tablets suck and if apple has supply problems most of the rivals would too.
This story is rubbish.
4 x the price? In your dreams.
Don’t forget the iPad screen is IPS so costs more than a cheap TN panel for a POS netbook with a poor viewing angles.
I think they mean that the iPad screen costs 4 times more than the typical pos they build for Acer, etc..
This story is straight BS. I think Apple Still has inventory of IPad 2 hidden somewhere. Apple are total control freaks they will release iPad 2 at their own rate. The product that actual looking to be delay is iPhone 5. They could have cover all the demand in the US but held back prodouct for the international launch.
There really needs to be accountability for dissemination of unverified FUD.
Make that unsubstantiated FUD
because verified and substantiated FUD is so much more reliable? ;-p
As far as conventional displays goes, there is a surprising variance in sharpness and color. Apple was known to pay display-makers extra for the right to select the top 5% quality monitors. Michael Dell was happy to get the leftovers for a few dollars less.
Nothing in this article or the dozen others on this story says Apple is paying more than to other manufactures. What they are saying is that IPS panels used by Apple cost 4x as much as the junk AU sells normally. AU hasn’t been making IPS panels and will need to expend capital establish the capacity so on a short term basis this is likely to be a negative for them. Unless of course as by both Apple statements and rumors has it with some of Apple’s other component suppliers that deals are struck to aid financing of plant and equipment. Story out today is that Samsung is spending 3.5 billion expanding chip fab capacity to meet demand for A5 chips.
Apple has 35 billion stranded overseas and is using it to strategic advantage. No one should be fooled by poor journalism to think Apple is just going to bend over without vasiline to meet demand. Instead expect them to strike deals that keep making it harder for the compitition to catch them.
So, looking ahead to Spring 2012 when the iPad3 is announced and then, finally, placed on sale, is Apple going to undervalue the demand once again or will they anticipate the numbers really needed to produce adequate units to their customers? Is Apple going to ramp up production to have many more units available at launch? Or, will we have to go thru this debacle again with limited supply?
I call 4xRate Bullshit! Apple strategists are FAR too smart for that…
I think the article is bullshit too. But it raises the issue: Apple’s problem with supply. Jobs always admired Sony because he said they had such a great ability to meet demand with advanced manufacturing and supply chain management.
Demand for Apple’s products is unprecedented. I’ll give them that. But so was demand for the Sony Walkman, and Sony was brilliant in its supply of that product.
Apple really needs to get more iPads out the door faster or they will lose customers. Yes the iPad will be dominant but we’re talking weeks delay worldwide. That damages their reputation as a company.
People forget so quickly: the iPhone 4 had the same problem. For months it was backordered, line ups every night in Canada downtown Vancouver for MONTHS, for example. And the white iPhone was nowhere to be found.
Make no mistake: this supply problem is incredibly challenging for Apple and the biggest thorn in their side right now. There’s no easy solution because going with other manufacturers at this point is risky since the product has already launched. Adding other suppliers mid-stream could cause quality problems…