Apple preparing A-series processor production move to TSMC: sources

Apple preparing A-series processor production move to TSMC: sources

Summary: As the patent battle between Apple and Samsung shows no sign of ending, it seems that the Cupertino, Calif.-based technology giant in preparing to turn to TSMC for its A-series processors.

SHARE:

It's quite evident that Apple wants to banish Samsung from its supply chain, and for good reason. The two companies have been locked in a bitter patent war, which has spread to nearly every continent in the world.

Now, industry whispers suggest that Apple could shift production of its A-series processors -- the silicon at the heart of every iOS-powered device that Apple sells -- away from the Korean electronics giant, and to the Taiwan Semiconductor Manufacturing Company (TSMC).

The rumor comes via Chinese tech site DigiTimes -- which is hardly the most reliable source when it comes to Apple-related news -- but the report does fit in with other chatter that I've been getting from the supply chain.

The report claims that TSMC will begin producing chips for iOS devices during 2013, but that the huge volume of chips that Apple requires -- some 200 million per year, which works out at some 200,000 12-inch wafers -- would put a huge pressure on TSMC.

TSMC chief executive Morris Chang has previously suggested that it would make sense for the company to devote at least one semiconductor fabrication plant (or "fab") to a single customer. And, just as it happens, TSMC has a new fab expected to come online in late 2013.

If Apple shifts production to TSMC, then a move from the 32-nanometer process that Samsung currently uses to a more efficient -- both in terms of power and dies size -- 28-nanomter process makes sense, especially given that TSMC already manufactures 28-nanometer parts for the likes of Nvidia and Qualcomm.

If Apple starts demanding hundreds of millions of processors from TSMC, then this could potentially put a crimp in Nvidia and Qualcomm's supply chain. A number of fabless companies have grown to rely on TSMC for silicon, and if Apple starts throwing its weight around, some of them could be left scrabbling for a new supplier.

As noted by Ars Technica, Apple has been testing production of next-generation A6 processors using TSMC's advanced 28nm process over the last year. If that is the case, then it's not a matter of if Apple move production away from Samsung, but when.

Image source: Apple.

Topics: Apple, Hardware, Processors, Samsung

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

8 comments
Log in or register to join the discussion
  • Not well thought out or reported

    There is a certain chip capacity and there is a certain chip demand. If Apple moves from Samsung to TSMC, the equation does not change; the production simply moves around. There is a small issue of process, but over time it is not really material. Everybody keeps shrinking and only Intel still has an ongoing advantage.

    It is also interesting that the tech press invariably talks about Apple ditching Samsung, but does not mention Samsung's booming sales in mobile, meaning they need more and more of their chip capacity in-house and therefore have less available for external contract manufacturing and presumably have to turn customers, perhaps Apple, away.

    I think this subject deserves a more insightful reporting than we are currently gettng.
    D.T.Long
    • Hi Sami

      Great to hear from the Samsung chairman!
      johnsuarez10
      • Better trolling required

        n/t
        Little Old Man
        • LOL...

          ...says the master.
          frogspaw
          • Thank you

            n/t
            Little Old Man
  • Doesn't even matter

    The Note II, Galaxy S3, and Galaxy Note were all listed as the top phones for the 3 largest Carriers in the USA with only Verizon listing the iPhone 5 as one of its top models.

    The Nexus 10 performs on par with the iPad 4 yet has a higher resolution screen. The Note 10 is also a top seller for Samsung as is the Galaxy Tab 2 7"

    Truth is, Apple cannot stop this tidal wave even if they take their business away. In fact doing such only stands to hurt their brand with Sub par performers.
    slickjim
  • Sue your customer

    It's bizarre that Samsung sued its customer, Apple.

    Apple will need to find a chip fabrication plant to manufacture multi-core 64-bit ARM processors for its future 'Macs', or whatever they may be called.
    Vbitrate
    • Sue your single-source supplier for CPUs

      It's bizarre that Apple started this silly patent wars. What were they thinking?

      Obviously Apple never understood the meaning of: "Never bite the hand that feeds you"?

      Please don't forget it is Apple who sued Samsung first. On false and malicious pretext of 'slavishly copying'. Something that has been legally proven false everywhere in the world, except in a blatantly biased courtroom 20 miles from the Apple headquarters in Cupertino, California.

      But now Apple is going to reap the consequences of their stupid, narcissistic actions of their demented leader Steve Jobs. The RDF is only limited to blind followers after all.

      As soon as the prior contracts between Apple and Samsung expire in 2013, Apple can kiss goodbye to their supply of CPUs. Apple better find an alternative source... Quick! Or else, they'll have nothing to sell.

      And Samsung certainly doesn't even need Apple's orders.

      Just Google Samsung 41.4 and Samsung 38.3 to see Samsung invested USD$ 41.4 Bn in 2012, and $38.3 Bn in 2011 alone. Far eclipsing the amount of business Apple brings to Samsung (less than $10bn). The sum of all Apple orders from Samsung now represents less than 2% of Samsung's annual revenues. Basically, completely insignificant. Mere noise not worth the trouble it causes.

      Ironically, Apple doesn't even figure on the list of the Global Innovation 1000: Top R&D Spenders 2004-2011
      http://i.imgur.com/OH4d6.jpg

      http://www.booz.com/global/home/what_we_think/global-innovation-1000/top-20-rd-spenders

      What a shame.

      ~~~~~~~~~~
      Never underestimate the power of human stupidity.
      ~ Robert A. Heinlein

      The difference between genius and stupidity is that genius has its limits.
      ~ Albert Einstein

      Gratitude is not only the greatest of virtues, but the parent of all others.
      ~ Cicero, 106 BC-43 BC

      Sent from my Google/Samsung Nexus 10...
      WinTard