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Finisar deal helps Apple block rivals' path to AR features

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Finisar deal helps Apple block rivals' path to AR features

Postby MrFredPFL » Thu Dec 14, 2017 12:40 am

Story :

Apple Inc’s (AAPL.O) $390 million deal with chip supplier Finisar Corp (FNSR.O) announced on Wednesday helps lock in the supply of a component that Apple believes will play a big role in its future products by bolstering augmented reality features.

And because the parts Finisar supplies are new and in extremely limited supply, the deal also helps Apple lock out Samsung Electronics Co Ltd (005930.KS), Huawei Technologies Co Ltd and other competitors in the premium smartphone space that are working to develop similar features, analysts said.

The investment will enable Apple to “get better supply and better pricing, and it makes it more difficult for Android phones to compete,” said Gene Munster, a longtime Apple watcher at Loup Ventures.

Apple awarded Finisar $390 million from a $1 billion fund dedicated to American manufacturing. Finisar, a much smaller firm with a market capitalization of $2.2 billion, was quick to say that the deal did not represent debt or equity investment but “anticipated future business between the companies over a period of time.”

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