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Apple actually does this with a few different commodities. It sources Aluminium directly from mines and smelters in Australia [1], and prefers these type of dea

Apple actually does this with a few different commodities. It sources Aluminium directly from mines and smelters in Australia [1], and prefers these type of deals over buying materials on dubious secondary markets like it is forced to do for Tantalum for batteries [2]. Before he became CEO, Tim Cook ran the entire supply chain for Apple and before that for HP/Compaq and he became a master of doing big deals to lock up global materials supplies to make it much harder for competitors to compete [3]. As a consequence Apple is known to have one of the most efficient large scale supply chains in tech. [1] https://www.businessinsider.com.au/how-apple-forced-microsoft-to-build-a-tablet-2012-6 https://www.businessinsider.com.au/how-apple-forced-microsof... [2] http://www.newsweek.com/2015/02/13/where-apple-gets-tantalum-your-iphone-304351.html http://www.newsweek.com/2015/02/13/where-apple-gets-tantalum... [3] http://fortune.com/2009/02/19/report-apple-has-cornered-the-flash-memory-market/ http://fortune.com/2009/02/19/report-apple-has-cornered-the-...

gxs 9y ago
FYI those articles are super old, one is from 2009. The landscape's changed quite a bit in the last few years.
ksec 9y ago
You kind of expect, with their possibly the best supply chain teams and economy of scale, Apple will be getting some advantage over other players. Example they are possibly the largest NAND and DRAM purchasers, and yet it doesn't seems to be reflected in their product. I.e the NAND prices for Apple should be cheaper then say Lenovo, HP or Dell. I have had the same theory about Apple's diseconomies of scale long before Gruber publish it [1], although we may have no way to prove it, this Cobalt story may just be another example. Apple are willing to pay a premium for it, as long as the supply is stable. [1] https://daringfireball.net/linked/2017/07/17/iphone-2017-snell https://daringfireball.net/linked/2017/07/17/iphone-2017-sne...

gxs 9y ago

FYI those articles are super old, one is from 2009. The landscape's changed quite a bit in the last few years.

ksec 9y ago

You kind of expect, with their possibly the best supply chain teams and economy of scale, Apple will be getting some advantage over other players. Example they are possibly the largest NAND and DRAM purchasers, and yet it doesn't seems to be reflected in their product. I.e the NAND prices for Apple should be cheaper then say Lenovo, HP or Dell. I have had the same theory about Apple's diseconomies of scale long before Gruber publish it [1], although we may have no way to prove it, this Cobalt story may just be another example. Apple are willing to pay a premium for it, as long as the supply is stable. [1] https://daringfireball.net/linked/2017/07/17/iphone-2017-snell https://daringfireball.net/linked/2017/07/17/iphone-2017-sne...