How and why Samsung may finally bite the price bullet – Times of India

Samsung may finally bitten the price bullet when it comes to chips. According to a report in Apple Insider, Samsung may join the rest of the chip production industry in increasing the price to make semiconductors. The price rise comes as chip foundries raise the cost of manufacturing important components used in modern electronic devices. As per the report, sources familiar with the matter told Bloomberg that Samsung is talking to clients to increase semiconductor pricing.
Incidentally, Samsung is not the first company to increase the chip prices. Most of its rivals have upped prices in early or mid-2021. This includes Apple chip partner TSMC, which some say may also lead to increase in iPhone 14 pricing. However, Samsung managed to maintain status quo with its pricing throughout 2021.
How much more: Depends
The rise in prices may go up to as much as 20%. However, it is not likely to be a flat increase, but range between 15-20%. The rise in prices may vary from customer to customer based on a number of factors. This includes the design and nodes required for production. The tougher the designs the higher the price. Similarly, customers going for legacy nodes may have to pay more.
When does the new costing come into effect
There are no confirmations on this, but report claims that the new pricing is likely to come into effect starting from the second half of 2022. Samsung is still talking to some customers, while has concluded talks with others.
Why the price hike
Samsung managed to control the prices despite Covid-19-related supply chain disruptions. However, the fresh Coronavirus-related lockdowns in China and global uncertainty over Ukraine-Russia war has made it tough for Samsung to weather the storm this time.