Future iPhones destined for Chinese market may draw upon local supplier for flash storage

A report by the Nikkei Asian Review on Wednesday claims that the Chinese government-backed Yangtze Memory Technologies is in talks with Apple for future NAND supply. If the report is accurate, it will be the first Chinese supplier to produce memory for the iPhone, with any delivered product not expected until 2018 at the absolute earliest, as the first factory lines for the new company won't come fully on-line until then.

Citing unnamed sources, the report notes that full capacity and quality won't be possible until after 2020. Additionally, the publication claims that according to two other sources the chips would only be used for iPhones sold in the Chinese market — a first for Apple.

The company, previously known as both Yangtze River Storage Technology and Changjiang Storage is owned by state-supported Tsinghua Unigroup. At present, it is not known if the Chinese government is applying any pressure upon Apple to source locally, like the India government does as a condition to do business in the country.

Why Apple would make this move is not clear, nor is the accuracy of the report. Nikkei's track record from the supply chain overall is adequate, but its predictions on Apple's future specific plans, like where any given chip order is destined, are iffy.