Company aims for 'three cover guarantee'

Apple is becoming aggressive when it comes to securing components for its products, says Ticonderoga Securities' Brian White. The analyst claims, for instance, that following the earthquake and tsunami in Japan, the company immediately sent executives to suppliers to guarantee a steady flow of parts. It has in fact been offering suppliers upfront cash payments, according to White.

Contacts in Taiwan claim that the company is trying to secure component production using a "three cover guarantee," meaning capacity, stock and price. The policy could be harming Apple's rivals, as supplies were already in contention prior to the earthquake and without such strict demands. RIM's PlayBook is alleged to have been delayed by a month because of Apple touchscreen demands.

During its Q1 results call in January, Apple revealed that it had forged a $3.9 billion component deal. It did not say who the deal was signed with, or even what kind of parts it had secured. It is widely believed, however, that the arrangement is for displays, which have become absolutely essential to the company because of the iPhone and iPad.

by MacNN Staff