Samsung has secured a contract for iPod chips, replacing long-term Apple partner PortalPlayer.

A Samsung executive claimed the company had secured the contract to supply the chips, in a move which sent PortalPlayer shares into free fall. The latter firm - which estimates claim sources 80 per cent of its business from Apple - announced it had lost Apple's business late last week.

Speaking at the SEMI Strategic Business Conference yesterday, Samsung senior vice president for the technical marketing group Jon Kang made the claims.

The chip is based on a 32-bit ARM processor, Kang explained, adding that he knew his company's win would impact against PortalPlayer.

"We've been working with Apple a long time," he said. "It's a huge win for us," he said, according to Information Week.