Samsung Shouldn't Fret Losing Apple Chip Orders

As we look ahead to 2013, one of the more interesting story lines is that of the deteriorating relationship between Apple and Samsung. Things took a turn for the ugly between these two tech giants when the former won a patent infringement case against the latter and was awarded $1.05 billion in damages, but the war was far from over.

The two are still tossing lawyers into the ring with one another, but what some people don't realize is that they also have a working relationship with each other, however strained it might be. Samsung is a major chip supplier for Apple, though for how long is anyone's guess. Should Samsung be worried about the threat of Apple taking its chip orders elsewhere? As always, it depends on who you ask.

Samsung Galaxy S III
If Samsung stopped making processors for Apple, it could expand chip production for its own brand devices beyond just the high end models.

According to DigiTimes Research, the potential loss of Apple's application processor (AP) orders is unlikely to have a significant impact on Samsung's logic IC operations. Samsung's own products are selling like gangbusters, and because of that, the company's IC business is expected to sustain its growth momentum, DigiTimes Research says.

One thing that's interesting to note is that Apple's chip orders take up the majority of Samsung's AP production capacity. If Apple were to pull out completely, Samsung would be in better shape to produce chips for its own brand mobile devices. As it stands, Samsung mostly limits its production capacity to high-end devices like the Galaxy S III, S II, and Note II. But with Apple potentially jumping ship, Samsung could also produce chips for its lower end products.