Technology
How Apple may be supporting smaller vendors with technology developed by larger vendors
Apple is reportedly helping smaller vendors prosper at the expense of major ones. According to a report from The Information, the Cupertino-based tech giant is sharing new technologies or processes developed by larger suppliers (which were developed only for Apple). The report states that this measure by Apple sometimes leads the original supplier to bankruptcy.
Apple contracts could make suppliers vulnerable
According to the report, Apple abruptly canceled the contracts of two micro LED suppliers. One of them reportedly spent $1.4 billion building a factory for the iPhone maker. The report notes that these suppliers also have no recourse with Apple, as cancellations may have been allowed in the contracts.
The report also notes that Apple’s typical contracts give it full control or at least co-ownership over each step of the supplier’s manufacturing process. This means that a supplier could invest in developing a production technique and Apple could have every right to take that process to another company. The report also accuses Apple of doing this by providing information from US companies to suppliers in China.
In 2014, a supplier called GT Advanced Technologies was working with Apple to create a scratch-resistant screen material. A previous report from AppleInsider claimed that the vendor was left owing nearly half a billion dollars. The report also stated that this happened to the supplier due to Apple’s increasing demands and refusal to renegotiate. For this cancellation of the contract, the supplier would have declared bankruptcy.
Later, Apple reportedly took the material recipe developed by GT Advanced Technologies and handed it over to suppliers including Hong Kong-based Biel Crystal.
Some unspecified former employees also alleged that Apple provided the details of the technology to another company called Lens and subsequently pitted each company against each other to get better prices.
Apple also reportedly spent years helping Chinese display maker BOE match the quality of displays made by Samsung. In November 2023, South Korean Samsung filed a lawsuit against the BOE. However, this lawsuit may just be a retaliatory response to the Chinese screen supplier who accused Samsung of stealing its patents.
The report also stated that Apple is helping China’s SeeYa Technologies by passing along the details of how Sony is making the Apple Vision Pro.
Sony has also refused to increase its production capacity for the Apple Vision Pro. This suggests that the iPhone maker may look for an alternative.
Apple contracts could make suppliers vulnerable
According to the report, Apple abruptly canceled the contracts of two micro LED suppliers. One of them reportedly spent $1.4 billion building a factory for the iPhone maker. The report notes that these suppliers also have no recourse with Apple, as cancellations may have been allowed in the contracts.
The report also notes that Apple’s typical contracts give it full control or at least co-ownership over each step of the supplier’s manufacturing process. This means that a supplier could invest in developing a production technique and Apple could have every right to take that process to another company. The report also accuses Apple of doing this by providing information from US companies to suppliers in China.
In 2014, a supplier called GT Advanced Technologies was working with Apple to create a scratch-resistant screen material. A previous report from AppleInsider claimed that the vendor was left owing nearly half a billion dollars. The report also stated that this happened to the supplier due to Apple’s increasing demands and refusal to renegotiate. For this cancellation of the contract, the supplier would have declared bankruptcy.
Expand
Later, Apple reportedly took the material recipe developed by GT Advanced Technologies and handed it over to suppliers including Hong Kong-based Biel Crystal.
Some unspecified former employees also alleged that Apple provided the details of the technology to another company called Lens and subsequently pitted each company against each other to get better prices.
Apple also reportedly spent years helping Chinese display maker BOE match the quality of displays made by Samsung. In November 2023, South Korean Samsung filed a lawsuit against the BOE. However, this lawsuit may just be a retaliatory response to the Chinese screen supplier who accused Samsung of stealing its patents.
The report also stated that Apple is helping China’s SeeYa Technologies by passing along the details of how Sony is making the Apple Vision Pro.
Sony has also refused to increase its production capacity for the Apple Vision Pro. This suggests that the iPhone maker may look for an alternative.
