Comment by dwaite

5 hours ago

Apple funds creation of new factories in return for exclusive use of the parts they produce. I believe they also prefer to negotiate pricing down to cost, then pay bonuses for meeting quantity/date goals.

Supposedly, the reason there weren't more iPod competitors back in the day was that Apple already had negotiated exclusive rights at pre-negotiated prices to buy a big chunk of the flash memory that otherwise would have been on the market.