In the unlikely event that the current tensions in the Korean Peninsula escalate into a full-blown war, it would have a devastating impact on the smartphone and tablet markets, IHS predicts.
Smartphone market leader Samsung would of course also face risks of disruption, as would LG Electronics. Together these companies account for over 30% of global smartphone market share by unit sales.
But an armed conflict that disrupts South Korea's technology manufacturing base would also be a disaster for the tablet display market, the research firm says – the nation accounts for 70% of total shipments.
Samsung and SK Group's SK Hynix also together hold 66% market share by industry revenue of the DRAM market and 48% of the NAND flash market. The world's remaining memory manufacturers would be unable to easily replace this proportion of global production.
IHS senior principal analyst for DRAM and memory Mike Howard pointed out that a smartphone needs the original amount of DRAM it was designed to use in order to work.
He said these statistics underline the fact that “South Korea now plays a more important role than ever in the global electronics business.”
The impact of even a relatively brief disruption on the sector would therefore be severe, Howard said. “Any type of manufacturing disruption of six months would prevent the shipment of hundreds of millions of mobile phones and tens of millions of PCs and media tablets.”
Howard said IHS advises electronics companies to understand the scale of South Korea's role in the global market, and to start preparing for any contingencies.