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Apple 'games' NAND flash market

Order a lot, buy a few?

graph up

Korean flash-memory manufacturers are grumbling that Apple is gaming the NAND market.

An article in Sunday's The Korea Times reports that the kvetching centers around allegations that Apple is depressing flash prices by ordering large amounts of NAND chips from Korean manufacturers, but purchasing only smaller amounts - and then only when prices fall to a level that Cupertino finds acceptable.

Sounds to us like some Koreans aren't writing airtight contracts.

Or, equally likely, that the market clout of Apple's iPhone and iPod product lines has NAND manufacturers by the short and curlies.

The Korea Times quotes a NAND-industry exec as saying: "Apple should certainly be blamed for deteriorating the supply and demand cycle in the global NAND flash market."

The official, according to TKT, refused to be named. Also nameless is another official who described Apple's purchasing strategies as "absurd" and who said "Samsung and Hynix both provide chips to Apple and have less of an edge in deciding prices and volume. Apple's strategy could hurt the industry's health."

Namelessness, of course, has a long and honorable tradition in industry leakage, but in this case, it appears that it's being used as a shield by execs who want to stir up a hornet's nest while remaining in Cupertino's good graces.

One can't blame the Korean manufacturers for wanting to put some pressure on Apple's purchasing strategies, seeing how those strategies are depressing their margins. However, until allegations of actionable illegality surface, all Cupertino can be charged with is what's called in the States "good ol' country hardball."

Apple did not immediately respond to our request for comment. ®

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