Samsung Working to Keep Design Dispute Separate from Component Contracts
Reuters now notes that Samsung CEO Kwon Oh-hyun, who took the reins of the company as part of an executive reshuffling in June, was not present at that meeting. According to the report, Kwon's absence was part of Samsung's efforts to compartmentalize the patent and design dispute within the company. While he does serve as CEO, Kwon's primary responsibility is to oversee the company's component business, a division that maintains a close relationship with Apple.
The clear message from Samsung is that a strict internal firewall between its handset business and its components operations remains intact.The report notes that both Samsung and Apple have been seeking to diversify their supply relationships to reduce their reliance on one another, but the two companies remain very close partners on the supply chain side. According to statements by Apple's lawyers during the trial, Samsung parts currently comprise 26% of the component cost of the iPhone, even with Apple taking steps to move contracts for some commodities such as DRAM from Samsung to competitors Elpida and Hynix.
While it plans to appeal the U.S. verdict, and a damages bill for $1.05 billion for copying critical features of Apple's popular mobile devices - a sum that could be trebled - Samsung will not want to put at risk its Apple supply contract which is worth billions of dollars.