Apple Tops List of Largest Semiconductor Buyers in 2010

Top 10 OEM Semiconductor Buyers
(Ranking by Revenue in Billions of U.S. Dollars)

According to a new research report from IHS iSuppli, Apple became the world's largest semiconductor buyer among original equipment manufacturers (OEMs) in 2010, leaping past HP and Samsung to comfortably grab the top spot with $17.5 billion in spending. Apple's surge has seen it rise from third place in 2009 and sixth place in 2008.

"Apple's surge to leadership in semiconductor spending in 2010 was driven by the overwhelming success of its wireless products, namely the iPhone and the iPad," said Wenlie Ye, Analyst for IHS. "These products consume enormous quantities of NAND flash memory, which is also found in the Apple iPod. Because of this, Apple in 2010 was the world's No. 1 purchaser of NAND flash."

Apple's lead over second-place HP, which stood at $2.3 billion in 2010, is expected to balloon to over $7.5 billion in 2011 as Apple expands its purchases to over $22 billion while other vendors remain relatively stagnant.

The report points out the marked differences between Apple's and HP's businesses, citing data showing that 61% of Apple's semiconductor spending in 2010 was on wireless products while 82% of HPs spending was on traditional computer products. That difference in focus, combined with the exploding smartphone and tablet market, has been driving Apple's run up the charts.

Apple is also cited for its ability to create an "ecosystem" of its products, with the company's tie-ins across devices leading consumers to stick with Apple for each new computer and mobile device purchase. This contrasts with the traditional PC business that offers no such ecosystem, thus leading to considerably lower brand loyalty across the range of devices and more fragmentation in purchasing patterns.

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120 months ago

Wonder what the world would look like if it's all an Apple ecosystem...


A lot more efficient.
Score: 4 Votes (Like | Disagree)
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120 months ago
Apple continues to rise and take over just about every metric we have for a tech company.

I hope other American companies take note. Apple is a company that takes pain to, and successfully defines itself through its product offerings and philosophy. That's what's necessary to differentiate yourself from many other companies in a global economy.
Score: 4 Votes (Like | Disagree)
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120 months ago
Wouldn't be good for anyone to lose Apple as a customer . . .
Score: 2 Votes (Like | Disagree)
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120 months ago
Wow... like i said last week, looks like it's definitely time to put some money into TSM Taiwan Semiconductor Manufacturing TSMC
Score: 2 Votes (Like | Disagree)
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120 months ago

So Samsung could bring out there own device and have an almost zero purchase cost as they would make most of the internals themselves.


No, they wouldn't have "almost zero" purchase cost. Creating silicon isn't cheap. There are immense investments to be made, and the production is definitely not free either. If Apple and Samsung use the same Samsung chip, then Samsung's cost is probably more than 95% of Apple's cost. If Samsung tried to charge Apple $100 for something that costs $90 to produce, then Toshiba would offer the same item for $95 and Apple would buy that.
Score: 1 Votes (Like | Disagree)
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120 months ago

Do the chips in Macbook Airs also count in this? Since they are somekind of flash?

It includes chips in all Apple products, whether they be Macs, iDevices, or other things like Airport base stations or Apple-branded AC adapters.

Basically, if it has an Apple logo and it has parts made of silicon, it counts.
Score: 1 Votes (Like | Disagree)

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