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iPad mini shortage concerns following screen supply issue

Life after Samsung: Apple hit with iPad mini screen supply issue, has to find new battery suppliers

The iPad mini is on many a Christmas wish list, but the fall out from the legal fighting between Apple and Samsung may mean that Apple cannot meet pre-Christmas demand for the iPad mini.

A report from DigiTimes suggests that one of Apple's screen suppliers for the iPad mini is struggling to meet demand.

In what many see as Apple's attempt to distance itself from arch-enemy Samsung, the company has been searching for other companies to supply parts for its devices. For example, LG Display and AU Optronics were confirmed as the suppliers of display components in a teardown of the iPad mini by HSI iSuppli earlier in November. Samsung had been the supplier of screens for the full-sized iPad. This confirmed expectations - back in March this year we reported that AU Optronics and LG would make panels for the iPad mini.

However, AU Optronics is said to be having a few issues meeting demand for the screens. That company is suffering from poor yields in the production of panels, according to DigiTimes sources.

That report claims that LG Display and AU Optronics shipped about four million panels for the iPad mini in November. The report notes that industry observers expect the cumulative shipments of the iPad mini to reach 6-8 million units by the end of 2012.

A separate IHS iSuppli report in October suggested that "any display manufacturing and yield issues could impact the availability of the mini iPad for the remainder of the year." In the context of this claim, there are concerns that the issues at AU Optronics might mean Apple struggles to meet demand for the iPad mini. However, iSuppli's later tear-down of the iPad mini noted that "Apple has multiple sources for many key components, such as the display" and luckily LG appears to be capable of providing sufficient panels, according to DigiTimes sources.

Samsung won't recharge Apple's battery account

It's not only screens that Samsung is no longer providing for Apple. The company is also said to have stopped supplying Apple with batteries.

Apple now uses Chinese companies Amperex Technology Limited and Tianjin Lishen Battery, according to China Business News, via Brightwire.

In this case it's not only the iPad that Apple needed to change battery supplier for. Samsung will also cease providing batteries for Apple's MacBook laptops.

Samsung v Apple: War declared

Samsung and Apple are embroiled in a legal war, with each company saying that the other has stolen its patented technology. News that Apple is seeking alternative suppliers suggests that the outcome of the Apple versus Samsung California trial could cost Samsung far more than the $1bn the company is supposed to pay Apple for infringing its patents. Apple is Samsung's biggest customer and its business is worth 8.8% of Samsung's revenue.

The new iPhone 5 doesn't include memory chips or displays supplied by Samsung. Samsung does still build the A6 chip for use in the iPhone, although Apple now designs the chip itself - and is said to be considering switching to Taiwan Semiconductor Manufacturing Company (TSMC) to supply processors from the second-half of 2013.

However, speaking at the recent Apple financial results conference call with analysts Tim Cook said Samsung is a "crucial" component partner and will remain so at least in the near future.

It has been suggested that the reasoning behind the move has nothing to do with the Apple verses Samsung patent dispute. Instead, it is in line with Apple's plan to diversify its supply chain.

Follow Karen Haslam on Twitter / Follow MacworldUK on Twitter

Related:

iPad mini teardown reveals 43 per cent gross profit margin for Apple

Report: Samsung Display terminates LCD contract with Apple

New iPhone 5 'won't include' Samsung chips or screen

AU Optronics, LG to make panels for iPad mini

AU Optronics found guilty in LCD price fixing scheme

Sharp can't make iPhone 5 screen fast enough, caused supply issues

Will ditching Samsung parts mean Apple struggles to meet demand for iPhone 5?

Apple contract worth $2.1 billion to Samsung this year


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