Apple reportedly moving chip production away from Samsung

Oct 13, 2012
21

Apple and Samsung, as many of you already know, have not had the most civil of professional relationships. Samsung has long been a provider of hardware for Apple products, but with the recent high-profile patent suit between the two, it seems that relationship has soured a bit. New reports from CNET and Taiwan Economic News (via MacRumors) are claiming that Apple is looking to move away from Samsung when it comes to the chips for its products, instead striking a deal Taiwan Semiconductor Manufacturing Co. (TSMC) and having that company produce quad-core processors for future devices.

However, this shift in manufacturing partners may not necessarily be because of the bad blood between Apple and Samsung. Apple is interested in TSMC's 20 nanometer processes - currently, Samsung develops the A-series chips inside the iPhone and the iPad with a 32 nanometer process, and moving to TSMC's 20 nanometer process would promise chips that are more powerful and efficient. Unfortunately for Samsung, TSMC would become the sole provider of Apple's chips, which means that Samsung would lose a pretty big customer once Apple begins looking elsewhere.

Analysts confirmed the change in partners to CNET. "Apple is working with TSMC at 20 nanometers," said Piper Jaffray chip analyst Gus Richard. Another unnamed source did blame the shift on Apple's soured relationship with Samsung, saying that the iPhone manufacturer is merely looking to fulfill contractual obligations with Samsung before looking elsewhere. Because of that, we're likely to see some Apple products using Samsung-made chips, while others begin using TSMC chips as Apple slowly switches from one to the other.

While netting Apple as a customer would be a big win for TSMC, this isn't good news for TSMC's other customers. Apple, obviously, buys an incredible amount of processors due to the absurd popularity of its devices, so putting that kind of demand on TSMC means that less attention will be paid to the company's other clients. Apple could look to test out TSMC later this year or early 2013, with production of these new chips ramping up late next year for use in products that will be releasing in 2014. Stay tuned, because we'll undoubtedly hear more about this change soon.


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