Posted by John Hultar on Feb 22, 2013

Samsung beats Apple, Almost

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Steve Job’s biggest nightmare seems to be becoming a reality. A manufacturer, of Samsung Electronics, utilizes Google Inc’s Android programming to make cell phones and tablets that are very similar to the iPhone and the iPad. Samsung appears to be stealing massive market share from Apple. Additionally, Samsung is responsible for hurting Apple’s margins, stock price and ultimately threatening its reign as the “King of Cool Electronics.”

Jobs, obviously, had a solution to this: a “thermo-nuclear” legal debate that should keep copy-cats off the market. Yet almost two years after Apple first filled a patent-infringement claim on Samsung, and six months after it won an immense lawful triumph over its South Korean competitors, Apple’s possibilities of obstructing the deal that Samsung offers are becoming dimmer by the day.

Tim Cook, an Apple official was prevented from suing Samsung, mainly due to the fact that Samsung is a main provider of parts for the iPhone and the iPad. In 2012, Apple purchased about $8 billion worth of necessary parts from Samsung.

Samsung, meanwhile, has profited massively from the business knowledge it picked up from their connection with Apple, and from processing cell phones and tablets that take after Apple’s.

While the two companies compete fiercely in the high-end smartphone business – where as one unit they control about 50% of sales and mainly all of the profits – their strengths and weaknesses are almost identical.

As their war comes to an end, it is clear that Apple and Samsung have more than enough in common including the drive to overpower other potential competitors, for example BlackBerry or Microsoft.

The comparison with other notable tech industry competition is stark. Any time Apple blamed Microsoft in the 1980s for ripping off the Macintosh to make the Windows managing framework, Apple’s entire being was at stake. Apple lost, the Mac came to be a niche item, and the group verged on extinction before Jobs came back to Apple in late 1996 and spared it with the iPod and the iPhone. Steve Jobs died in October 2011.

The partnership between Apple and Samsung goes way back to 2005. Back in 2005 the market for flash memory was highly unstable, so Apple needed to find a permanent provider who was rock solid financially. People who are familiar with the partnership said, Samsung held about half of the flash memory market.