What Would Happen If Samsung Just Stopped Making Parts For The iPhone?

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It’s unlikely that Samsung would just suddenly stop making components for Apple with no notice — for one thing, it’s probable that air-tight product contracts are in place that would prevent Samsung from doing just that — but let’s get hypothetical: what would happen if Cupertino’s legal campaign resulted in Samsung just taking all of its silicon and going home?

Short answer: it wouldn’t be pretty.

A solid chunk of every iPhone is built out of components supplied by Samsung, including the flash memory, DRAM memory and applications processor. In total, these components account for 26% of the component cost of each iPhone 4.

If Samsung got so pissed with Apple over suing them for ripping off the design of the iPhone and iPad, who would supply these components? There are few companies that could match Samsung’s price, or ship in enough volume to make the tens of millions of iPhones the world is clamoring for.

Of course, all of this is just out loud musing. Businesses are good at compartmentalizing, and so while Apple and Samsung may be at each other’s throats in the courts over intellectual property issues, that may not affect the production side of things at all. That said, there’s a reason Samsung is fighting so hard for its Galaxy smartphones and tablets: there’s a lot more money to be made selling smartphones and tablets to customers than selling Apple the components to make the same.