“The recent investment in Sharp by Samsung can pose a serious threat to Apple in the long run,” Ashit Gulati writes for The Motley Fool. “Apple is considering to trim down its dependence on Samsung for supplies, as Samsung is also one its prime competitors. However, Samsung’s investment (3% stake) in Sharp that also supplies display panels to Apple, will force Apple to re-think the entire supply chain strategy.”
“Samsung’s stake in Sharp will enable it a stable access to display panels. Apple being the largest player in the industry controls a tight ship over its suppliers, however having to struggle with Samsung over production capacity and volume will relinquish its hold,” Gulati writes. “As the smart phone industry grows and diversifies with new entrants, existing players will strive hard to diversify the supply chain to sustain competitive advantage. Samsung’s growing smart phone business and the recently announced backward integration will force Apple to re-strategize, in order to avoid losing further control over its vendors.”
Gulati writes, ” A 3% stake is not very threatening; however it now pushes Apple to think out of the box to establish new supply chain partnerships for a steady and reliable access of display panels.”
Read more in the full article here.
MacDailyNews Take: Wait, how did we go from “serious threat” to “not very threatening” in seven sentences?
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