Apple has booked 40% of Samsung's flash chips for 2H 2005Apple is expected to introduce a 4 GB iPod Mini using NAND flash memory in time for the Christmas season, and they have employed Samsung to be the provider of that memory. The maker of the ragingly popular iPod has booked 40% of Samsung's NAND flash output for the second half of 2005.
"If Apple can sell 4 million units of its flash-based iPod in the fourth quarter, that demand alone will account for 36 percent of Samsung's fourth-quarter NAND capacity of 11 million units," said Deutsche Bank analyst D.J. Yook.
Nam said Samsung has aggressively courted Apple, offering extremely low prices on its NAND chips to encourage the firm to switch to flash memory instead of hard disk drives for its iPods.
The price of NAND flash chips is about double that of hard disk drives at the 4-gigabyte capacity level.
"With its abnormally high profit margins for NAND flash, we believe Samsung still will make money on this deal," said Nam. "For Samsung, sewing up the iPod memory business is well worth the reduction in margins."
Wow -- that is a lot of flash. There is no word yet on whether the 4 GB flash-based Minis will replace the current hard-drive-based Minis, but if that turns out to be the case, you might want to go pick up a 4 GB Mini before Apple starts rolling out the new ones. With the storage component at double the price, I'm sure Apple will have to raise prices a tad.
Article Link: Analysts: Apple to Buy 40% of Samsung's Flash Chips
