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Korean FTC May Investigate Apple/Samsung
freaktheclown writes "Samsung may have sold Apple flash memory chips at below-market prices, possibly violating the country's competition laws. From the article: 'According to a report by Yonhap News, Korean Fair Trade Commission (FTC) Chairman Kang Chul-kyu said that his agency could look into allegations that Samsung sold the memory chips to Apple at below-market rates. Apple reportedly grabbed a significant share of Samsung's flash capacity in order to introduce its new iPod Nano. Analysts also speculate the computer maker got a significant discount from Samsung in order to hit the Nano's $199 and $249 prices.'" Adds a new layer to a previous story, eh?
The "article" on the blog this story points to is full of "may" "could have" "possibly" and other weasle-word disclaimers. Nothing to see here.
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> Analysts also speculate the computer maker got a significant discount from Samsung in order to hit the Nano's $199 and $249 prices.'"
They can speculate that all they like, but the $199 2GB nano has Toshiba chips, not samsung.
Try again.
Don't most - indeed, if not all - electronics suppliers give substantial volume discounts? I'd say buying up 40% of stock would qualify for a discount. IANAL, but I don't see why that is an issue.
have gotten at leas one thing wrong
"Analysts also speculate the computer maker got a significant discount from Samsung in order to hit the Nano's $199 and $249 prices"
the $199 model uses flash chips from toshiba (2* 1gb) whereas the $249 model uses flash from samsung (2* 2gb)
If Mac OS had become the dominant platform back in the day instead of Windows, you'd all be talking about Microsoft's superior engineering and decrying Apples anti-competetive tactics.
;-) But I wouldn't put too much behind a statement like "There's a reason Apple was the only one to put out a small/sleek player when everyone else was still putting out clunky nightmares"... The original iPods still looked, felt, and functioned much better than the competition, and after those 1.8" drives hit wider availability said competition STILL hadn't whipped up anything much that's par, let alone a few swings under.
;-)
You got that right.
Those talking about Apple's superior engineering and aesthetics still have quite the point.
Dirty? About as dirty as any restaurant that only sells Coke or Pepsi products.
Apple got Hitachi to sole-source the HDs it used in the iPod. Big woop. Not necessarily dirty. Others had their chances at a slice of the 1.8" drive, too.
And Apple agreed to buy a big-ass load of NAND chips for the Nano to very favorable terms. Again, big woop.
If you are selling a commodity product, and someone comes along and says, "Hey, I'll buy all of your production for the next 18 months," and you still make money on it, you tend to bite on it.
Since we don't know what pricing level the KTC is looking into, it could be that Apple just committed to a magnitude larger memory buy than other buyers had done up until that point. Instead of selling several lots of 1 million SKUs, maybe, at varying price points over time, Apple says, "Hey, we'll buy 10 million SKUs over the next year at $5.00/10000 (when "the market price" tends to be $5.5/1000, or whatever) with half of the total up-front, and the rest delivered monthly upon delivery...", which is guaranteed money for Samsung (and pissing off AMD, Intel, Xylinx et al).
Again, not a big deal.
Want to buy a couple of animals from a farmer, but it'll take a week or two? OK. But if someone comes along and offers to buy everything he has for sale a couple of days after you talk to him, too bad!
Can someone explain to me how this is reflects badly upon Apple? I'm asking sincerely. When I go shopping I look to find the cheapest price. Seems as if Apple was just doing the same. If they can negotiate a better rate from Samsung, I'd consider it foolish not to. It more sounds as if Samsung might have broken some Korean law, no?
It's Toshiba, not Hitachi.
Apple has never used Hitachi 1.8" drives in iPods. Rio did, in the Karma.
And there were no other drives available because Apple was buying them as fast as they could be made. That's the only reason. The drives were available before the iPod came out (in 2.5 and 5 gig configurations), so anyone could have got them. And anyone perhaps could have gone for an exclusive. But they didn't, Apple did. Toshiba could have made an mp3 player of their before Apple made the iPod (they made one later instead).
You're off your rocker. Even if Apple is the only one who could get these drives, that's not even Apple's fault. Any company would like an exclusive. It's Toshiba's fault for granting them one.
Apple innovated a lot with the iPod. A company that was there before Apple like Creative or Archos could have made a device with the 1.8" drive before the iPod even came out. They didn't. That's the Apple difference.
Anyway, I thought this horse got beat to death when Apple killed Mac clones. Is there really anything left to be said about Apple's willingness to compete as a commodity after that?
http://lkml.org/lkml/2005/8/20/95
Not below cost, "below market prices"?
If selling below market prices is illegal, how do market prices ever fall?
http://lkml.org/lkml/2005/8/20/95
Dirty? Hell yeah.
Hell, no. Apple made a deal to buy all the drives they could make. They placed a big enough order that Toshiba brought up a second factory just for those drives. Nobody put a gun to Toshiba's head, and if someone else wanted to buy those drives, so what? Every deal has two sides, and if Toshiba would rather deal with a single customer for the first year (or more), that's their prerogative.
That while every other large coorperation will lie, cheat, and steal to get ahead -- Apple is somehow different.
Show me an example of Apple lying, cheating or stealing, cause this isn't it.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
First of all, I was incorrect. It was toshiba. It wasn't until hitachi started making 1.8 drives that someone was ABLE To compete with apple. My appologies for that mix up.
Second of all, my point isn't that this was some awful thing that Apple did. This is how business is played. It's not nice and friendly, its down and dirty, and Apple plays the same game as everyone else.
If Microsoft had used their clout to buy up all of Toshibas drive to make a slim mp3 player that took the market by storm, and companies like Apple were uanble to get any 1.8 drives to make players with your collective outrage would know no bounds. You would bitch and moan to no end that Microsoft was not playing fair. While I fully expected my original post to be unfairly moderated down (my karma can take the hit), it surprises me that so many of you could be so hypocritical.
I don't take issue, really, with how Apple condudcts itself, simply with the ultra-unrealistic impression that many of you seem to have about it. Apple is not some peace-loving commune where flower children lovingly hand-craft gadgets for your enjoyment. It's a business and it's run just like every other business.
Everytime they're accused of breaking the rules (as businesses will often do), there's a torrent of people anxious to rush to Apple's defense to tell us why it was "totally ok" for Apple to cheat. It's not ok for ANYONE, no matter how sexy their latest toy may be, to cheat wether it's Microsoft, Apple, or anyone else.