iPad 2 stock shortage causes Apple to shift strategy

I may be a lowly news guy, but even I knew months ago that Apple's iPad 2 would sell well. Apple have been caught napping, yet again and are having to reevaluate how they get more stock into the supply chain.

Apple are reportedly taking on a new supplier of displays for the tablet. According to sources in Taiwan, AU Optronics Corp, which is the world's fourth largest LCD maker by volume have been contracted by Apple to provide flat panel screens for the iPad 2. This would mark the first time that Apple have used AUO for iPad supplies.

The report also indicates that Apple will pay three or four times the average rate paid by others for displays of the same size. It is possible that AUO were able to negotiate a very strong rate in order to guarantee xxx percentage of AUO's total output capability.

The original iPad suffered from the same problem, with LG Display even saying at the time that they simply couldn't produce enough screens to keep up with the worldwide demand. Adding another supplier to this chain will make the process much better for Apple.

The knock on effect of this deal with AUO could mean that other companies producing tablets may very well be pushed lower down the chain, especially if Apple are paying three to four times the average rate others are paying.

KitGuru says: Will this help customers get the new tablet? It should certainly help Apple deliver more stock.

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