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News
iPhone Demand May Outpace Parts Suppliers
Wednesday, January 24th, 2007 at 2:00 PM - by Jeff Gamet
Apple's iPhone has the potential to be a success, but the company may have issues meeting demand if parts suppliers aren't able to keep up with manufacturing needs. The holiday 2007 buying season is likely to put a strain on suppliers if they aren't prepared to ramp up production quickly, reports CNN.
Touch-panel and NAND Flash memory suppliers face the biggest risk of parts shortages - both are key components in the iPhone. The demand for Flash-based memory chips is growing since they are used in the iPod nano, iPod shuffle, cell phones, digital cameras, and other MP3 players. That demand increases the possibility of a supply shortage before the end of the year.
Merrill Lynch analyst Tony Tseng commented "Flash is the most possible sector that may face the [shortage] problem, and touch screens are also a niche product, so it might be another concern too."
Apple hopes to gain 1 percent of the cell phone market in 2008. Hitting that goal, however, may be based on parts availability, and not consumer demand.
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