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iPhone 5 Delayed Over Chip Shortage?

iPhone 5 Delayed Over Chip Shortage?

Apple (NASDAQ: AAPL) might be forced to delay the release of the iPhone 5 because of a shortage of high-end chips.

According to Want China Times (which cites a First Financial Daily report), "The newest generation of the iPhone uses chips manufactured using 28-nanometer fabrication, an advanced production technology known only to a few companies."

Want China Times quoted a Qualcomm China (NASDAQ: QCOM) spokesperson who said that the company "will be able to tackle the 28nm chip undersupply only by the end of this year." Qualcomm is Apple's primary supplier of chips.

To resolve this issue, Qualcomm has reportedly signed agreements with Samsung and United Microelectronics to help manufacture chips for the company.

If successful, this could help Apple meet demand, enabling the company to release the iPhone 5 on time.

"As Apple keeps firm control over its inventory, it is cautious about selecting new suppliers," Want China Times reports. "Its heavy demand for components often drive suppliers to operate at full capacity. Partners must meet Apple's tough demands or risk losing a major buyer; its production chain consists of 156 companies."

The chip shortage could also have an impact on Chinese brands, such as Xiaomi and 360, since they also use Qualcomm's 28nm chips.

Samsung and HTC, however, do not. This could give Samsung -- which shipped 52.1 million smartphones in the second quarter -- a significant advantage in the months ahead.

But Samsung should not celebrate just yet. Reports of iPhone delays are quite common within the mainstream media.

Last month, Want China Times reported that the iPhone 5 was "likely to be delayed due to unresolved issues with the phone's battery." Thus far, no such delay has materialized.

Follow me @LouisBedigianBZ

Posted-In: Apple HTC iPhone 5 Qualcomm SamsungNews Rumors Tech Best of Benzinga


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