In an "exclusive" Reuters reports that Samsung makes Apple's iPhone chips in a Texas plant which is two parts surprising: first, the two companies have been spatting for months over patents and Apple is known mostly for manufacturing its iThings in Chinese factories where labor conditions don't exactly meet American conscience standards. But perhaps one has to do with the other?
Forget that Apple and Samsung hate each other. After all the bad publicity Apple has received for the conditions at the firms that manufacture its goods (Foxconn followed Steve Jobs to the grave), you would expect the company to seize an opportunity to play up its contribution to American manufacturing. But Apple declined to comment on the Reuters write-up, which is sourced to "people familiar with the operation."
That brings us to the other odd part of this news. There are not very many chip manufacturers who can satisfy the demand of a company like Apple, but it's still a bit strange to see Apple more deeply intwine itself with its legal enemy. The two companies are in a patent war that Apple started, after-all. Back in April, Apple filed a suit against Samsung for copying the design of its iPhones and iPads. Samsung gadgets indeed look a lot like Apple. Though, Samsung certainly isn't the is only offender. And Samsung has its own gripes with Apple's design choices.
Apple has always had a financial relationship with Samsung, buying over $6 billion worth of parts from Samsung from Summer 2010 to Summer 2011 alone, according to The Austin Statesman. At that point American Statesman's Kirk Ladendorf wondered if the fighting would tarnish the state of the plant, which had not yet begun processing Apple's chips. Apparently not, as Reuters is now reporting that the chip production line reached full capacity in early December and accounts for a majority of non-memory chip output.
Yet, the fight has tarnished this arrangement at least a little bit. Apple has since broken its exclusivity with Samsung, signing a deal with the Taiwan Semiconductor Manufacturing Company back in September, claims Digitimes report. But, that supply line isn't expected to start moving until 2012. It's always smart to cover one's bases.
This article is from the archive of our partner The Wire.