This is a cautionary tale for any company that makes and sells stuff in any industry.

Up until about 15 years ago, Apple manufactured the products it sells in its own factories. Aside from buying commodity parts like memory chips, drives and processors, it actually put everything together itself. 

Aside from paring down its product lines and designing desirable pieces, the real key to Apple's enormous profitability has been the outsourced manufacturing process Tim Cook put in place. As James Allworth describes in his article, this process has taught suppliers like Foxconn and Samsung a lot about how make huge numbers of gadgets very efficiently. 

That is almost certainly a major part of why Samsung is the only cell phone maker besides Apple to generate any significant profits in recent years. 

These lessons don't apply exclusively to the technology industry. Beginning in the early 20th century, +Ford Motor Company and then +General Motors became huge and profitable in part through tremendous vertical integration. In recent decades, they increasingly outsourced component and system manufacturing and even engineering. While they had plenty of internal problems, relying increasingly on suppliers means that you lose control of things that could be a competitive advantage. 

For example Ford was dependent on Aisin Saiki for the the first generation of transmissions for its hybrid Escape and Fusion. Aisin is an affiliate of Toyota and as a result, Ford couldn't get enough supply and it paid higher prices for transmissions, limiting the number of hybrids it could sell even as Toyota's hybrid sales went through the roof. 

For the new 2013 C-Max and Fusion, Ford decided to in-source the major hybrid components, thus enabling higher volumes and 30% lower costs. Ford and other automakers are recognizing the issues with outsourcing and are now increasingly reversing course.