Samsung COO Lee Jae-yong met with Tim Cook this week to discuss long-term component supply deals

Wed, Oct 19, 2011


Despite contentious patent lawsuits that span the globe, Apple and Samsung aren’t willing to part ways just yet. Just yesterday we reported how Apple was still tapping Samsung to handle the bulk of its A6 production and now comes word via Yonhap News that the two companies are also exploring future long-term component supply deals. Note that Samsung COO Lee Jae-yong this past weekend flew to California to attend Steve Jobs’ memorial service and, rumor has it, engage in some high level talks with Apple CEO Tim Cook.

And now Jae-yong has confirmed that those discussions took place in an interview with the Korea Herald.

Lee Jae-yong, chief operating officer (COO) of Samsung Electronics said Wednesday he had discussed long-term parts cooperation arrangements with Apple Inc.’s chief Tim Cook.

The meeting took place Monday after Lee attended a memorial service for Steve Jobs, Apple’s late co-founder, and as Samsung and Apple remain locked in fierce legal disputes to control the global smartphone and tablet computer markets.

As it stands now, Apple and Samsung are tied into component agreements through 2012 and the meeting between the two executives was meant to explore the potential for future deals going forward.

“For the 2013-2014 period, we discussed how best to supply even better parts,” he said, adding that during the more than two-hour meeting, the businessmen touched on past challenges and how to promote good relations in the future.

Apple has in the past entered into long-term contracts with Samsung in an effort to lock up supply of certain components such as Flash memory. As part of these deals, Apple pays a lot of money upfront and is able to secure favorable pricing as a result. These deals also work to limit the ability of rival companies from acquiring the volume of components they need for their own products.

Jae-yong didn’t flesh out any details regarding the success of his meeting with Cook, but with Apple supplying upwards of $8 billion to Samsung in 2011 alone, it appears that the two companies aren’t going to let their ongoing legal dispute get in the way of multi-billion dollar component contracts.

Not yet at least.


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