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Samsung Gives Major Incentive To Its 103 Chip Suppliers

July 22, 2015 - Written By Ricardo Trevizo

Samsung has been working hard to become not only the world’s largest smartphone manufacturer but also the world’s largest smartphone hardware manufacturer; to achieve this, Samsung is planning to offer a rather hefty monetary inducement for the company’s chip suppliers to keep up the good work they’ve been doing over last year. Samsung currently has 103 chip suppliers, which since the Galaxy S6 and Galaxy S6 Edge began undergoing development, were acquainted with the task of meeting the quite elevated demand for hardware to power both flagship devices, as Samsung opted to include its own Exynos 7420 chipset instead of the Qualcomm Snapdragon 810 processor. Today, a new report stated that Samsung has finally addressed the incredible effort by said chip suppliers and will pay a combined 14.2 billion won (which is equivalent to $12.3 million), before the end of this year’s first half.

Samsung knows that without the great assistance of its 103 chip manufacturers, the company would have never meet the Galaxy S6 and Galaxy S6 Edge demands, although it is clear that Samsung is learning how to completely manufacture its own devices without relying in other companies, as it previously did when the South Korean-based company had a strong partnership with Qualcomm to produce processors for its flagship devices. Samsung wants to make sure that the overall quality of its own Exynos chipsets don’t drop, which is why the company will offer the largest incentive it has ever given to all its chip suppliers after 5 years of doing so. This strategy has helped Samsung grow exponentially in the long term, as the manufacturing firms that have been working with Samsung are mostly small or medium sized, which means that not a major investment has to be made for them to work together.

The 103 chip suppliers working with Samsung will also now be paid on a bi-annual basis, instead of once a year as the company previously did. Several reports have stated that the reason behind this is that the current state of the world’s economy is rather poor when compared to previous years. Samsung seems to be so confident about its 103 suppliers, that a rumor has spread about the company manufacturing the chips for the next-generation iPhone, which would show how Samsung has improved the quality of its hardware.