Behind Apple's Sapphire Screen Debacle 189
Frankie70 (803801) writes Apple invested more than $1 billion in an effort to make sapphire one of iPhone 6's selling point. But the iPhone 6 was released without the sapphire screen. GT Advanced Technologies, the small company chosen to supply Apple with enormous quantities of cheap sapphire, declared bankruptcy a month later. Recent documents from GT's bankruptcy proceedings, and conversations with people familiar with operations at Apple and GT, provide several clues as to what went wrong. GT said that to save costs, Apple decided not to install backup power supplies, and multiple outages ruined whole batches of sapphire. The terms Apple negotiated committed GT to supplying a huge amount of sapphire, but put Apple under no obligation to buy it. In its bankruptcy documents, GT would later accuse Apple of using "bait-and-switch" tactics, and said the terms of the deal were "onerous and massively one-sided."
Than don't sign the contract (Score:5, Insightful)
In other news: A company so desperate to get into bed with Apple signs away their soul for rainbows and promises.
Re:Than don't sign the contract (Score:5, Insightful)
Re:Than don't sign the contract (Score:5, Insightful)
it's a classic case of "customer knows better" and they have all the money so you have to do what they say.
GT is too excited to get into business with Apple. Apple is so excited about their super secret sapphire plant they won't let the people they PAID do the job they're PAID to do.
I've seen this at smaller companies all the time. Automakers are also famous for it. They sign up mom-n-pop shops and basically take them over till they run out of business... in the auto industry it's practically a revolving door of these type of deals.
Than don't sign the contract (Score:3, Interesting)
Re:Than don't sign the contract (Score:4, Insightful)
Happens all the time. IBM, then Microsoft, became famous for it. Message to small companies: you are always better off going without the business rather than taking a bad piece of business.
Re:Then don't sign the contract (Score:5, Informative)
It's not that cut and dried. Apple was the one who insisted on renegotiating the contract, as well as not installing a backup power supply for each furnace and starting production in a non-commissioned plant.
Apple originally offered to buy sapphire-growing furnaces from GT. But according to sources familiar with negotiations, after five months Apple demanded a major change in terms, requiring GT to supply the sapphire itself. In fact, Apple wanted GT to build the world’s largest factory to produce the stuff—more than doubling the world’s entire sapphire production capacity.
Producing sapphire requires a very clean environment, but ongoing construction at the factory meant that sapphire was grown "in a highly contaminated environment that adversely affected the quality of sapphire material," according to GT. It also requires uninterrupted supplies of water and electricity to regulate the temperature of the molten aluminum oxide used to form the boule. GT said that to save costs, Apple decided not to install backup power supplies, and multiple outages ruined whole batches of sapphire.
Make no mistake about it - Apple was in the driver's seat in this mess. It was their deadline for the iPhone6 that set the stage for attempts to grow sapphire in an unfinished factory. But Apple will find a way to make money out of this.
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They could still have ended negotiations. That said- it would take an extremely good businessman to do it at that point, most would already be counting the money Apple would make them. But if a deal is wrong you need to walk away. They're hardly the first company to fail because they made a bad decision to take on a contract they weren't ready for.
Re:Then don't sign the contract (Score:5, Interesting)
it would take an extremely good businessman to [terminate] at that point, most would already be counting the money Apple would make them. But if a deal is wrong you need to walk away. They're hardly the first company to fail because they made a bad decision to take on a contract they weren't ready for.
The Register ran an opinion piece when the details on this story were first appearing [theregister.co.uk] a couple of weeks back. It noted an almost unbelievable point others have commented on elsewhere in this thread:-
[The usual form of the contract is that companies agree] to build whatever to [the agreed] standard and by that time. Excellent. If we do so then you have to either take them and pay for them or if you don't take them you've still got to pay for them. If we don't make them to standard or in time then here's the damages we'll pay. But if we hit the spot then you're committed to pay for them.
But here's what it actually did sign up to:
Those agreements, said Daniel Squiller, GTAT's chief operating officer, were almost entirely one-sided. By the time Cupertino's lawyers were done, he said, GTAT was presented with an deal that, among other terms, required it to: commit to producing millions of units of sapphire, even though Apple was not obligated to buy any of them.
Something the author describes as "sheer lunacy". Either they were utterly, *utterly* struck blind or there is something strange and dubious going on. Oddly, the "struck blind" explanation isn't as improbable going by a comment in the letters section [theregister.co.uk] (from "Edwin"):-
The sexiness of having Apple (or some other A-list brand) as a major customer is extremely seductive to many 'executives'. Not only because it's great advertising, but the bolstering of the supplier's individual executive ego.
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I once contracted for a medium-small company that was under contract with Disney to supply services. Disney was a royal pain in the ass to this company in that they were super picky, but the company used them for bragging rights when attempting to sign on other companies. Eventually they dropped Disney when it was realized the bragging rights were not worth the abuse.
Re:Then don't sign the contract (Score:4, Interesting)
Eventually they dropped Disney when it was realized the bragging rights were not worth the abuse.
The problem is that- depending upon the contract- the smaller company being screwed over is now in a position where they *can't* pull out of the contract because their large customer has them over a barrel. They've expanded and/or dedicated significant resources to supplying and pleasing that customer they thought would be a cash cow- possibly dropping other markets- and if the large company was to terminate the contract as threatened, they'd then have a massive production operation to fund with no-one to buy the end result.
It's either that quick death, or the slow death of having your margins ruthlessly squeezed beyond a sustainable point.
From another letter in the comments section of that article (from "Mugs"):-
I was once stuck on a train with a colleague ranting about a similar contract. The contract was in the 40s between Woolworth and his grandfather who ran a broom factory. Woolies started off with a small order, gradually increased until they took all the output then drove the price down until the factory went bust.
This was behaviour I was already familiar with relating to Wal-Mart, but it shows you it happened even back then. You can bet your life that in every case, the large customer knew exactly how this was going to play out in advance.
See this:- The Wal-Mart you don't know [fastcompany.com]
And this:- The Man Who Said "No" to Wal-Mart [fastcompany.com]
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My guess is that at some point Apple decided the new manufacturing technology was unlikely to work in their timescale, and was not going to make its plans dependent on it (I imagine this was shortly before it backed out of acquiring the manufacturing equipment.) At this point, GT became the party desperately seeking a deal, and Apple effectively said 'show us, and we will consider it.'
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So one more example that, in the corporate world, a verbal agreement isn't worth the paper it's printed on. You'd think that sooner or later people would stop having to learn that one for themselves. I suppose some people like to gamble, but if a company doesn't include verbal agreements in the written contract shouldn't your first assumption be that they plan to screw you over sooner or later? Or are at least including it in their contingency plans.
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So one more example that, in the corporate world, a verbal agreement isn't worth the paper it's printed on.
Who makes a 500 million dollar deal based on a verbal agreement? You also took GTAT's word hook, line, and sinker.
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" Either they were utterly, *utterly* struck blind or there is something strange and dubious going on. "
Or they were led on by Apple and a bit naive. They probably over-extended themselves trying to please Apple on the implied promise of a large contract.
That's essentially what I was implying by the first of those two options.
Re:Then don't sign the contract (Score:4, Insightful)
I newer understood the "not installing a backup power supply for each furnace" situation.
Who owned and was responsible for the factory? The story has always been that GT produced Sapphire, and that apple maybe wanted to buy it.
So why did GT let apple control anything at all, about their factories?
From the article " after five months Apple demanded a major change in terms, requiring GT to supply the sapphire itself. In fact, Apple wanted GT to build the world’s largest factory to produce the stuff"
So If Apple wanted GT to supply the sapphire, why did they have any say in the day to day running of the factories. Sounds like GT gave far to much factory control to Apple for no reason at all.
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Probably the GT execs ran out of money (by greedy bonus payouts to themselves and/or incompetence in planning) and had to go begging to Apple for more money for backup power supplies, at which point Apple said, "no, why didn't you ask for that in the first place?"
Apple would never have given the money to GT if they knew the odds of failure were so high, GT must have done a song and dance to Apple that GT was able to execute. You can see other suppliers to Apple not having such a rough go of it because you m
Re:Then don't sign the contract (Score:4, Informative)
This isn't uncommon in industry (it's also not the normal way of things). If we want to to be certain that a supplier builds something the right way, we might specify every detail of the tooling, and sometimes buy it and install it ourselves.
Re:Then don't sign the contract (Score:4, Informative)
GT never produced sapphire prior to this arrangement, they manufactured photo-voltaic silicon. Apple was looking to produce sapphire on a scale needed for their iPhone, something nobody had done before. GT convinced them they could do it. Apple required an exclusivity clause because they didn't want to invest any money unless they got all the sapphire and in return, the production process would be owned by GT. Apple bought the facilities in Arizona and loaned GT money to manage the operations. It was a large gamble that GT was willing to take. Apple's position carried less risk because they have a strong cash position and could continue to use Gorilla glass. When production yields where bad and GT didn't meet its obligations, Apple decided not to buy any sapphire. For its part, Apple did agree to renegotiate the contract to help GT, as they held out hope that GT could perfect the process after the iPhone 6 shipped. Unfortunately, GT's cash position deteriorated to a point where they needed bankruptcy protection.
Re:Then don't sign the contract (Score:4, Insightful)
But it sounds like Apple was bankrolling GT for the factory. which means they negotiated some kind of investment budget. Apple probably went through the list, found what sounds like excesses and asked GT if all this was really necessary or if it could be done cheaper. Apparently GT failed to justify the cost, so it was stricken from the final budget. When shit hit the fan it might have been too late to start redesigning and they were already behind schedule and budget with botched batches, GT might not have had the financial muscle to fix it and Apple might be concerned about throwing good money after bad. After all, this is how most terrible investment decisions are made, we're already $500 million down the hole so we need to spend a hundred more to finish it. Then we're already $600 million down the hole so we need to spend a hundred more to finish it and so on. Apple had a reasonable plan B by sticking with Gorilla Glass so they weren't pot commited as they'd say in poker.
Remember, just because GT can point to this and say that's why it failed doesn't mean it'd be a success otherwise as they might have stumbled on the next hurdle too. After all, if the product that did come out okay was that great I'm sure Apple would have been more willing to see it through too, unless they decided it was cheaper to let GT fail and pick up the pieces. I really doubt it's as easy as Apple buying GT's assets, installing a few UPSes in the factory and they're ready to go for the iPhone 6s. Like they say, production at this scale had never been attempted before which generally means you have to expect the unexpected. GT seems to have bet everything on things going according to plan, they gambled and lost. It's pretty cheap to try blaming Apple for their own botched execution, they're a business and don't just throw money around. If they failed to get sufficient investment that's nobody but GT's fault.
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But GT signed up for this. When I had my small business, we turned down big contracts regularly. You can't have a single client be 90% of your business, because if anything glitches,you're out of business. We would never take on a job that was more than half of our annual revenues, and we only took on one job like that at a time, filling the rest of the calendar with smaller jobs.
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In other news: A company so desperate to get into bed with Apple signs away their soul for rainbows and promises.
Yeah, we all know how bad that ended for Corning, who got suckered into massive investments to produce a formerly failed product by Apple. http://www.wired.com/2012/09/ff-corning-gorilla-glass/all/ [wired.com]
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You saw Steve Jobs near the current glass deal somewhere? It means Apple is not old Apple anymore. There is nobody in Apple anymore who could make other people believe in impossible things and then deliever it.
And yet GTAT did believe they could deliver. Odd that.
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In other news: A company so desperate to get into bed with Apple signs away their soul for rainbows and promises.
New entrepreneurs are always optimistic. They haven't dealt with irresponsible organizations or organizations that think out loud but then choose decisions other than what they let people believe. In a way one could say Apple was bullshitting their plans to confuse the competitors.
LMAO (Score:2, Insightful)
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Not quite, It is more Apple ruined them by promising to buy their product and then not following through after they had already heavily invested in meeting the supply for that promise. regardless they need to accept responsibility for entering into such a lopsided agreement. You make stupid decisions and stupid things happen. Why would you trust any company in this way, especially apple.
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Re:LMAO (Score:4, Insightful)
The trust usually comes because the small company assumes the big one wants to make money by completing an actual product line and selling it - normally the way just about everybody thinks Capitalism works. The small company says to itself, well, they've got to have X (like Sapphire coatings for screens) to make money - they can't actively want us to fail and take steps to make us fail or they take a hit too. So what we have to do is deliver the component at the price where they still make money, and as long as we do that, we're on the same side. So the small company focuses on distrusting the contract clauses it thinks are rational to distrust, in ways that it thinks might allow abuses a rational but dishonest actor might try..
It's like buying a car and thinking you can't trust the salesman to tell you the truth - only you should have somehow known the salseman wasn't the real salesman but a psycho-killer who had just slain the real salesman and the big thing he wanted wasn't to make too much money selling that car, it was your home address so he could pop by at 2 AM with his skinning knife collection. Most people don't go through life checking with NASA in case the persons they are dealing with are secretly space ailens.
From the summary, Apple seems to have had control over the decision to install back up power supplies, and to have chosen to save money on them instead. That sounds like an Apple executive brought in a good quarterly bottom line and then got out before the product couldn't be made as specced, and to heck with whether Apple still looks good five years down the road. The big company takes a small hit, the little one goes bankrupt. Apple is by this definition exceptionally untrustworthy, just because they won't take as much damage as their smaller subcontractors, or individuals, but if that's true, then Capitalism is a system where the bigger a company gets, the less it should be trusted, just for sheer size, and smaller businesses and customers should rationally start distrusting sheer bigness. How about that, free-market types and Randroids, do we need stronger Anti-Trust laws? The other solution seems to be extreme paranoia. If great market share or rapid growth mean everyone should regard that company as exceptionally untrustworthy, they why doesn't it make sense for consumers to always pick a smaller competitor for everything?
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No.
They could not deliver it, they made promises to apple they had no right making. They had NEVER MADE sapphire before. and then hoped that apple would set them up for the process.
Read the article and get the facts instead of just spewing incorrect information.
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Well, yes. Do you think your company could survive if offered a contract orders of magnitude larger than you'd ever seen, re-tooled to accommodate that one massive order, and then not getting paid for it?
Slight over-simplification, yes, but fairly representative of what actually happened.
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Taking on a contract like that is always going to be a big gamble, if it goes well the returns can be massive but if it goes badly it can sink your buisness.
Each party is always going to blame the other for the sinking, regardless of who or what was really at fault for the failure.
Its just Apple being Apple (Score:4, Insightful)
Maybe suppliers will now reconsider getting involved with Apple. Large companies with extreme market power will often bully their suppliers. It is common for large customers to make demands for price reductions below the contract price, with threats to dump the supplier if they refuse. Having a single customer that makes up most of your sales is a significant risk to any business and something that has to be carefully managed.
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IIRC, this was what killed off TRS (they of Dungeons and Dragons). They massively overextended by selling to a large buyer, who then proceeded to return all of the goods right before the deadline expired. They had to sell the company to either that party or someone else. So they sold themselves to Wizards of the Coast, to avoid having to sell to the original company that sank them.
The worse your business sector is doing as a whole, the more the predators and parasites come out and have a go at you.
Re:Its just Apple being Apple (Score:4, Informative)
Yes, but in this case, they weren't allowed to sell the glass they made to anyone but Apple, and if the goods were rejected, then by contract, they couldn't sell them to another company.
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And there you go.
The owner of the company is just a whiny baby that is angry he was stupid but does not want to take responsibility for his poor leadership and even worse business abilities.
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Tactical Studies Rules aka TSR ... not TRS, FYI
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IIRC, this was what killed off TRS (they of Dungeons and Dragons). They massively overextended by selling to a large buyer, who then proceeded to return all of the goods right before the deadline expired.
If you have a contract that allows the buyer to return the goods and get the money back, then you haven't actually sold them.
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I kind of wonder if something like this causes Apple to reconsider partnerships with vendors and play somewhat less hardball. It's obviously in Apple's best interest to have GT succeed -- the loan gets remade, they get a new gee-whiz screen material that no one else has or can even make (an established Apple strategy of cornering supplies of new technologies) and GT gets to make money, too, which can be invested in even better sapphire for the iPhone 7.
Squeeze your vendors too hard, there are fuckups and y
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Yes, go ahead...Blame Apple (Score:5, Insightful)
In its bankruptcy documents, GT would later accuse Apple of using "bait-and-switch" tactics, and said the terms of the deal were "onerous and massively one-sided." (Emphasis mine...)
And Apple gets blamed for this shortcoming? Why did GT sign on the god damned dotted line?
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Re:Yes, go ahead...Blame Apple (Score:5, Funny)
Pray I do not change it further.
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They gambled and lost.
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Why did GT sign on the god damned dotted line?
Perhaps because of said "bait-and-switch" tactics?
Doubtless Apple assured GT they would definitely buy all that sapphire; why else would they invest so much in producing it? Even though the contract technically allowed them to back out, there was surely very little chance that would actually happen, and a far greater chance of massive revenue from being a key supplier for the next iPhone...
Then it turns out that the product wasn't as shatter-resistant as they'd hoped, and they backed out, or whatever. But w
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Just a reminder GT did not sign on the dotted line, GT is not a real person not matter how many deceitful and disingenuous corporate types like to pretend it is, in order to shift responsibility away from themselves to other people and make them pay. So why would the corporate executives of GT sign, what kind of motivation would they individually need to risk their whole company in order to provide Apple the best deal possible. So how much money and risk could Apple save by investing in the executive team
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Just a reminder GT did not sign on the dotted line, GT is not a real person not matter how many deceitful and disingenuous corporate types like to pretend it is, in order to shift responsibility away from themselves to other people and make them pay. So why would the corporate executives of GT sign, what kind of motivation would they individually need to risk their whole company in order to provide Apple the best deal possible. So how much money and risk could Apple save by investing in the executive team of GT, keeping in mind as per typical executive teams the one thing they always put in place for themselves is a golden parachute when it all fails. So how much would Apple have to shift from one offshore tax haven bank account to another offshore bank account to basically get corporate executives to stab their own company in the back, keeping in mind Apple could save hundreds of millions of dollars over the life of the contract or eliminate hundreds of millions of dollars of risk.
Strange things go on in the world of finance where investment companies routinely buy into doomed companies, that enable vulture capitalists like Mittens Romney to make huge profits. For some strange reasons those executive teams of say pension funds go stupid and buy all sorts of crap for billions of dollars and yet they all still retire rich no matter how much other people's money they lose.
It should be pretty obvious by now when it comes to corporations, psychopathic corporate executives always act in their own interest and whether or not that serves the interests of the company they work for is completely arbitrary.
This is a case of over eager executives at GT biting off more than they could chew and a bunch of over eager executives at Apple trying way too hard to maximise profits with the result that everybody ended up with egg on their face. So IMHO they are both to blame. GT had the option of not signing a deal that was "onerous and massively one-sided" and telling Apple to go jump in a lake. As regards Apple they should have known better than to offer GT that crappy deal in the first place. I mean saving costs by
Both sides equally (albeit differently) at fault (Score:2)
Apple intimidated a smaller company into an unworkable deal.
The smaller company that supposed to be an expert in the field agreed to sign an unworkable deal.
Both failed to amend the deal in time to fix the debacle. Businesses amend deals all the time. Provided the fundamentals were good, all they had to do was communicate timely.
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Apple originally offered to buy sapphire-growing furnaces from GT. But according to sources familiar with negotiations, after five months Apple demanded a major change in terms, requiring GT to supply the sapphire itself. In fact, Apple wanted GT to build the world’s largest factory to produce the stuff—more than doubling the world’s entire sapphire production capacity.
In the end, the fundamentals weren't good for either party. GT is bankrupt, and Apple had to switch their plans from sapphire at the last minute.
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risk is nothing unusual in the business. all GT would have had to do was either:
- pad the contract enough to account for the risk (they may have, i've not read the contract)
OR
- say "no" to the amendment.
worst case scenario they would have lost a (granted, large) customer. instead they went bankrupt.
the fundamentals _were_ good. namely one side clearly wanted sapphire and had plenty of cash. the other side knew how to make it and had the expertise.
only goes to show that fundamentals alone are not enough to
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I guarantee the GT executives all got dirty filthy rich off of the failure.
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Except that Apple had no way to intimidated GT. GT did not have any need for Apple, and they could simply have walked away from Apple, and continued their business as before.
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it was never about "need".
nothing wrong with good old fashion greed..
Comment removed (Score:5, Interesting)
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That doesn't sound like this situation at all.
Apple loaned GT more than half a billion dollars to build the plant. When GT failed to deliver, Apple stopped giving them money. When GT ran into financial difficulties, Apple offered to give them more money and defer repayments to keep them afloat.
What did you expect Apple to do? Just keep on giving them more money indefinitely without getting anything in return?
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Try reading about the Atari-Amiga deal. It sounds a lot like this deal.
Atari made a loan to Hitoro to develop the computer. With the option of buying it afterwards when it was completed. But Atari, under Tramiel, decided it was better to let Hitoro sink with the development costs and get the Amiga for nothing extra - basically they would foreclosure Hitoro to 'pay back' the loan they made. The founders and partners of Hitoro would lose all the money they invested in the process. Thankfully Commodore bailed
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Jack Tramiel didn't doom himself when he took ATARI.
Under his leadership, ATARI made computer history with the ATARI ST line.
It is when he semi-retired and let his sons at the helm that the company slowly degraded into irrelevance.
Selling the exact same model of computer for 7 years was what doomed ATARI.
His late return consisted of killing the computers division and betting everything on a new game console (the Jaguar).
But his strategy towards games was simply to make the best possible hardware, and game w
sounds like IBM / Micropolis (Score:5, Informative)
IBM had used Micropolis drives back when 5MB was a common size. They insisted that Micropolis buy new production equipment to make the 40s in enough quantity to supply the projected PC demand, then IBM chose another vendor, leaving Micropolis with a lot of production capacity for which to pay, and no customer. Bye-Bye, Micropolis.
Post-human capitalism (Score:2)
Understanding how business is done in the second decade of the 21st century requires a level of cynicism that I'm just not willing to endure.
"onerous and massively one-sided." (Score:4, Insightful)
Uhm, you're supposed to notice this before you sign, not after you go bankrupt.
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It's not always easy to tell. In spite of all the apparent business and legal experts on slashdot screaming how obvious this should have been with 20/20 hindsight, I rather doubt the contract stated "Apple has the right to screw GT over royally". I think in this case, the devil will be in the details - it's probable that Apple abused obscure clauses (or possibly even violated the agreement) that at the time seemed unlikely to cause issues - the lawyers here will probably have to go over a lot of detailed do
Can see how this happened (Score:5, Insightful)
The salespeople saw money. The business people, who would normally assess risk, got blinded by the prospect of making huge amounts of money. The engineers who could see disaster coming were not consulted or ignored.
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The salespeople saw money. The business people, who would normally assess risk, got blinded by the prospect of making huge amounts of money. The engineers who could see disaster coming were not consulted or ignored.
I suppose the people signing the contracts saw big bonuses coming their way, plus big money from their company share options, with the risk being that they had to find a new job if the deal went sour. So a contract was signed that benefitted those signing the contract, but didn't benefit the company.
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They actually cached in lots of their stock one month before the release of the iPhone.
They knew very well what was going on.
Maybe Apple Will Learn a Lesson (Score:2)
Sure, it's great to drive the a good bargain with your suppliers. But, when you drive your suppliers out of business, particularly a sole supplier, maybe it's better to let them make a little money too.
Hardball negotiations not an effective strategy (Score:5, Insightful)
Not much sympathy for either party from me, as I'm sure both companies understood the nature of the contract. I wonder, though, how much it has cost Apple in sales and good will to be putting out a product without the top-of-the-line screen. Probably a lot more than they were trying to squeeze out of this deal with their ruthless negotiating tactics. This is the sort of thing Stephen Covey (7 Habits of Highly Effective People) was going on about when he advocated seeking out the win-win deal. If your partners don't prosper, it will always come back to hurt you.
They don't seem to care... (Score:4, Insightful)
In the meantime, at the office, all iphones without protectors are full of scratches, while the Samsungs have mostly pristine screens...
Ah, that old Apple Hater Lament (Score:2, Informative)
Perhaps they know that their customers are mostly fans who will always buy whatever overpriced gadget they throw at them
Or it could be Apple Haters do not and never will understand the reasons why people buy iPhones, and keep buying them after the first one.
It's also always been a puzzle to be how Apple Haters claim Apple has over-priced phones when the are the same price in and out of contract as other supposedly high-end phones.
iPhones do use Gorilla glass (Score:4, Informative)
They always have. The original iPhone was the first smartphone to use Gorilla glass, created by Corning at Apple's prompting. iPhones have continued to use the best available Gorilla glass continually on every single iPhone since. The screen on a Samsung is no more scratch resistant than the iPhone--your anecdotes are either coincidence or just you making shit up. Guess where my money is.
Re:Hardball negotiations not an effective strategy (Score:4, Insightful)
I wonder, though, how much it has cost Apple in sales and good will to be putting out a product without the top-of-the-line screen.
It's cost Apple nothing. They're selling every iPhone 6 they can produce.
Here's what could end Apple's winning streak [cnbc.com]
Another fear is that iPhone sales could hit a wall in 2015 because of its success rate, RBC's Daryanani said.
The iPhone is on track to capture almost 70 percent of the high-end smartphone market ($300 or more) in the next few months, at which point the company could possibly face some market saturation concerns, said Daryanani, who has an "outperform" rating on the stock with a $120 price target.
"If you are looking at having 70 percent market share in the next few months, you have to ask where is the new opportunity or where are the new revenue drivers for them?" he said. "So you have a hit point where you run into some saturation in the market. In the next six months this could become an issue."
Apple PR flacks are talking this risk down, but other than smart watches, Apple doesn't really have room to grow in the USA.
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It does have a top of the line screen (Score:2)
I wonder, though, how much it has cost Apple in sales and good will to be putting out a product without the top-of-the-line screen.
It dies; like every other top of the line smart phone the iPhone 6/+ uses Gorilla Glass.
In theory Sapphire about have been the new top of the line, but since nothing else uses anything better than what it ships with now why would Apple be losing sales over it?
Note that the Gorilla Glass guys claim Sapphire might have better scratch resistance, but is not as good in terms of shat
The missing information here: is it feasible? (Score:2)
Is it feasible to make sapphire smartphone screens which are not too shatter-prone? or not?
Are the properties of the material at that physical thickness and expanse just not good enough?
Or could it be done, if done more carefully?
Never mind the bolloxed business deal and manufacturing process in this case, is it feasible in principle at this stage of physics and engineering knowhow?
If so, isn't someone else going to pick up the slack here?
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Is it feasible to make sapphire smartphone screens which are not too shatter-prone?
Sure it is. Home Depot checkout scanner glass is sapphire-coated. You can drag steel tools across it all day for years on end.
Apple's CSM Strikes Again (Score:2)
Re: haven't been following... (Score:4, Insightful)
It's aluminum oxide. Basically impossible to accidently scratch. Can be made very Crack resistant if made correctly.
Re: haven't been following... (Score:5, Informative)
Crystaline aluminum oxide (AL2O3) to be precise. This material is called ruby if it is red, or sapphire in most other colors (Provided it is of gem quality, otherwise it is just corundum regardless of color)
It is pretty much only diamond that can scratch sapphire.
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Does anyone actually have problems with scratching of the latest generations of gorilla glass? I've had my Xperia Z2 for over half a year and because it has a glass back as well as front it makes it less risky to try scratch tests, so I've done it a number of times and let other people try to scratch it, and nobody has ever succeeded. I'm sure if you put a diamond to it you'd scratch it, but short of that, I can't see why more scratch resistance is needed.
Now, *crack* resistance, they could use good improve
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Re: haven't been following... (Score:4, Insightful)
Could not agree more, don't care what it's made from, if you do the above, it will come out scratched.
It's like keys that are unobserved in your pocket turn into diamonds.
Re: haven't been following... (Score:2, Insightful)
Wedding band or phone? Wedding band or phone? Wedding band or phone? ...fuck it, wedding band has to go!
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So it is transparent aluminum?
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Maybe the GT deal was a big ruse - a relatively cheap way to bargain a better deal for Gorilla Glass.
Re:WRONG- it's brittle (Score:4, Informative)
Sapphire ***IS*** extremely true scratch resistant (as in the surface atoms resist displacement) because sapphire is BRITTLE.
Well... no. Sapphire is extremely scratch resistant and sapphire is relatively brittle. Just because something is scratch resistant does not mean it has to be brittle. Gorilla glass is, for example, both harder and tougher than normal glass. Diamond is both harder and tougher (iirc) than sapphire.
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Apple drank the beta kool-aid that science/engineering is 'magic'.
So your argument is that GTAT conned Apple?
Re:haven't been following... (Score:5, Informative)
" Is anything LESS scratch resistant than a soft metal like aluminium? Does no-one here have even a basic understanding of material science."
Do you even have a basic understanding of mineralogy, let alone the Moh's scale of hardness, let alone basic chemistry to apply to those two particular topics?
Because you certainly seem to not have it.
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Re:haven't been following... (Score:5, Informative)
Re: haven't been following... (Score:2, Interesting)
Not op, but I assumed it was a trade name, not that they were using actual sapphire crystals. Now that I know the truth, it's much cooler.
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There are blue diamonds as well.
What makes the color is impurities in the crystal.
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Besides being an extremely hard, scratch-resistant gemstone that can obtain exceptional beauty, it is also highly-prized for being used in the bases of things like LEDs as a substrate for the indium-gallium based junctions because of similar thermal expansion and stability.
It's really a decent material in many applications. It's quite often used in watch faces.
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Sapphire is the crystalline form of aluminum oxide (-Al2O3). It's a variety of the mineral Corundum.
It's special because its hardness of 9 in the Mohs scale [wikipedia.org] combined with its transparency make it an ideal material for electronic devices' screens.
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Oh, you've seen the terms of the contract, then? Do please share.
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Did you even read the court filings?
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Which one? I couldn't find anything here [kccllc.net] that describes what you posted about.
The opposite, perhaps - e.g. GT Equipment Holdings, Inc was indeed incorporated separately to GT Advanced Technology Inc, and GT Sapphire Systems Holding LLC (and others).
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That's obviously nonsense, and the fact you'd post it just highlights you have no experience working with large multi-nationals. Firstly Apple will very much care about things like staff working conditions, following pollution rules etc which makes the general statement that they "didn't care how it is made" entirely incorrect. Secondly, it is very common for large companies to get ex