Micron to buy major Apple supplier Elpida, takes on Samsung

Micron will become the second-largest maker of memory chips worldwide, second only to Samsung, as it is set to buy Elpida Memory, a big supplier to Apple.

(Credit: Micron)

The Boise, Idaho-based chipmaker will purchase the bankrupt Elpida for US$2.5 billion, instantly doubling its share of the memory chip market to about 24 per cent. Market leader Samsung has about a 42 per cent share.

Elpida was formed in 1999, when NEC and Hitachi merged their memory chip businesses. But the price volatility of the memory market forced it to file for bankruptcy in February with US$5.6 billion of debt, despite having become the world's third-largest maker of memory chips.

The Japanese company has a strong presence in the mobile DRAM market, and has been a major supplier of memory to Apple — it was a leading DRAM supplier for the third-generation iPad and iPhone 4S.

"We suspect Apple may have influenced Micron's bidding in an effort to avoid disruption to their mobile DRAM supply," Glen Yeung, an analyst at Citigroup, wrote in a research note in May.


Add Your Comment 1

Post comment as

casbott posted a comment   

Pity, Samsung missed the bus on this one. If they (or another android based manufacturer) had bought it, they would have a sledgehammer to hold over Apples head in the Patent Wars, being able to disrupt supply in order to stop/punish malicious lawsuits, and just basically mess up any big apple launch. Say explain that they cannot do business with someone litigating against them- while Apple gears up for the iphone 5 launch and discovers it has no components.
Apple has definitely thought of this, which is why this deal went ahead, to prevent it happening, since Samsung is now a component provider to Apple. But instead of playing hardball with Apple, Samsung is supporting them while Apple weans itself off their factories. You can be sure that if the situation was reversed, Apple would embargo other companies, and intimidate third parties not to supply them, which is why Apple has worked to prevent it being done to them ("what if they behave like us?"). It's a bit like supplying arms to Germany in the 30's, you're just creating a bigger opponent for yourself down the road, while if you go all out now, well problem solved with your over aggressive rival.
This is part of the problem of Apples competitors being too honorable, they have got to get as nasty or they will keep losing ground, which only encourages Apple to keep pushing that tactic. If a whole series of different manufacturers all launched Patent Lawsuits on everything they could think of in every relevant market against Apple, it might put a end to the wars (by winning) forcing Apple to halt it's litigations.
Apple has even tried to get new standards in place for technology that they have to pay royalties for (Sims I think) and are investing heavily in research into fuel cells (buying up companies), stating that should they succeed and it does indeed become the new standard, of course they will allow other companies to use their technology - yeah right.

Apples corporate philosophy can best be described as "Can everyone else please f@*% off and die"

Sponsored Links

Recently Viewed Products