updated 02:28 pm EDT, Mon August 27, 2012
Internal 'firewall' separates business units
After taking a significant blow in US courts for patent infringement in an ongoing legal battle with Apple, Samsung is reportedly working to ensure that the conflict does not pollute the companies' component partnerships. The Korean company is said to have held an emergency meeting in Seoul on Sunday, as executives talked of maintaining an "internal firewall" between the company's phone segment and component supply group, according to a Reuters report.
Both players are fierce competitors in the smartphone and tablet markets, and to a lesser degree in the consumer computer business, however many of Apple's products, including the iPhone and iPad, rely on Samsung components such as display panels and memory.
Samsung attorney Charles Verhoeven has suggested that more than a quarter of the component cost of the iPhone is sourced from the Korean conglomerate. Jurors in the case against Apple outlined a damage award totaling over $1 billion, which could be tripled due to willful infringement, however the parts deal is estimated to be worth much more.
"Apple needs Samsung to make the iPhone and iPad. Period," said KDB Daewoo Securities analyst James Song. "Samsung is the sole supplier of Apple's processing chips and without Samsung, they can't make these products."
Despite the promise to embrace Apple as a component customer, the Korean company has vowed to keep fighting its American competitor in courtrooms around the world.