Samsung Produces Apple iPad2 and iPhone 4S Chips at Texas Facility

The key component of the iPhone 4S and the iPad 2 is now made in a Samsung-owned electronics factory in Texas, according to an exclusive Reuters report.

While the irony of the situation is self-evident, this news, if true, denotes an interesting change in Apple Inc.'s strategy of sourcing raw materials, on the cheap, from overseas manufacturers, the Reuters report suggests, quoting unnamed sources.

The 1.6 million square foot facility in Austin, Tx., is believed to manufacture, among a number of other chips, according to a Samsung spokesperson, Apple's A5 processor. This processor was first used in Apple's iPad 2 and then the iPhone 4S, as a replacement to the A4.

The South Korean electronics company has reportedly expanded its logic chip-making facility this year, to facilitate the production of the A5 processor chips. According to the Reuters report, the newly-constructed non-memory chip production line will be fully dedicated to A5 processor production.

The facility is the Samsung's only semiconductor manufacturing plant outside Korea and also has one of the most advanced semiconductor plants in the United States, where state-of-the-art NAND Flash memory chips are made.

Despite the chip bonhomie, both Apple and Samsung remain rivals, across a number of markets and countries. Both firms are also engaged in a legal patent war involving IP rights over Apple's iPad and Samsung's Galaxy Tab range.