Samsung to reportedly share production of Apple's 'A8' SoC with TSMC

Posted:
in General Discussion edited October 2014
A rumor out of the Far East on Sunday claims Apple has once again retained Samsung's services to build a next-generation processor dubbed the "A8," though a majority of production will reportedly be handled by Taiwan Semiconductor Manufacturing Co.

A7
Apple's latest A7 SoC. | Source: Chipworks


Citing industry sources, The Korea Economic Daily claims Apple has placed an order with Samsung to produce some 30 to 40 percent of a next-gen system-on-chip, dubbed the "A8," iterations of which is expected to power next year's flagship iOS devices. The sources explained difficulties with the advanced 20 nanometer fabrication process have resulted in unacceptable yield rates, prompting Apple to turn to Samsung's foundries.

It was reported in June that TSMC landed a contract to build future A-series SoCs starting next year, spurring speculation that the firm would be the sole provider of Apple's silicon. Rumors of a switch away from Samsung gained traction in April, when a separate report claimed Apple would move to TSMC after its current contract with the Korean company expired.

Further, AppleInsider reported in July that TSMC held a job fair in New York, suggesting the chip maker is planning to open a facility in the area. Apple could feasibly help finance the rumored fab, which could grant access to a dedicated production line.

Samsung has supplied Apple's A-series chips since the first iPhone debuted in 2007, including the A7 chip powering this year's iPhone 5s, as well as other components like RAM modules and device displays. The two companies have since become fierce rivals, however, due in no small part to an ongoing global patent dispute.

Recently, Apple has been actively looking to diversify away from Samsung, but the Korean company is one of the few electronics manufacturers that can produce the advanced components Cupertino needs to for its popular devices. The iPhone maker's attempts lessen its reliance on Samsung have been successful in some areas, however, an example being device displays.
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Comments

  • Reply 1 of 49
    Cant wait until apple cuts all orders from samsung. Will be hilarious to see them file for bankrupcy
  • Reply 2 of 49
    poksipoksi Posts: 482member

    It's almost unbelievable, how the whole west has given up to such a strategical value as silicon manufacturing is... 

  • Reply 3 of 49

    This is business.  No wonder if Samsung can pull all the production too for making best apple designed processors.  After all they make money.  

    But... But...

  • Reply 4 of 49
    First rule of business and politics: "No permanent friends, no permanent enemies".

    Though American WW2 hero General Patton would likely have described Samsung as "The Enema" :-)
  • Reply 5 of 49
    Quote:

    Originally Posted by jobsonmyface View Post



    Cant wait until apple cuts all orders from samsung. Will be hilarious to see them file for bankrupcy

     

    Samsung aren't dependent on Apple's semiconductor manufacturing orders, so I fail to see what your point is, apart from being some Apple fanboy, anti-Samsung fantasy.

     

    Back in the real world, losing Apple's orders would be painful for Samsung's Foundry Business Unit (yeah, like most large modern companies, Samsung isn't a single business entity) but so far it appears that Apple will be the one feeling pain, as Samsung appear to deliver for Apple, time and time again, when it comes to actually being able to produce working SoCs in the quantities that Apple needs.

     

    However Samsung have had enough prior warning to allow them to get replacement business for an in-demand resource. If Samsung's 20nm process works (no reason why it doesn't) then there will be customers who demand the latest processes lining up to use it.

  • Reply 6 of 49
    smalmsmalm Posts: 677member
    Quote:

    Originally Posted by jobsonmyface View Post



    Cant wait until apple cuts all orders from samsung. Will be hilarious to see them file for bankrupcy

    It will make a dent in their profits (revenue 197 bn $ / profit 26 bn $ in the last 4 quarters). 

  • Reply 7 of 49
    ``Further, AppleInsider reported in July that TSMC held a job fair in New York, suggesting the chip maker is planning to open a facility in the area. Apple could feasibly help finance the rumored fab, which could grant access to a dedicated production line.''

    The facility in the Area is Global Foundries Malta Complex.
  • Reply 8 of 49
    TSMC is leading in 28 nm. Why is Apple still stuck with samsung? Qualcomm, Nvidia all rely on TSMC.
  • Reply 9 of 49

    I can see why Apple would might wish not to spend money with an arm of its major competitor. However, business is business and Samsung appears to have been a reliable supplier:


    • They have the leading-edge fabrication technology in the required (high) volume

    • No-one has suggested that the A7 is constraining iPhone 5s availability

    • They appear to have respected Apple's confidentiality, at least this time*

     

    Some of these things are better than certain other suppliers: hands up those who saw leaked cases, cameras etc well before launch and shortage of some component is crippling 5s availability. So Apple potentially has something to lose also in any supplier change.

     

    *It's quite impressive that the 64-bit nature of A7 didn't leak to the press. What's more, I read Samsung's phone business's generic response on 64-bit - 'we'll do that sometime too' - as meaning they were surprised as well.

  • Reply 10 of 49
    mac_128mac_128 Posts: 3,454member
    command_f wrote: »
    *It's quite impressive that the 64-bit nature of A7 didn't leak to the press. What's more, I read Samsung's phone business's generic response on 64-bit - 'we'll do that sometime too' - as meaning they were surprised as well.
    Yes, it is quite impressive. I was genuinely surprised which is harder to do these days with all these leaks. The fact that Samsung did not immediately announce a 64-bit chip says to me they exercised amazing restraint, or really are managing to keep their divisions at arms length. That must be painful to do.
  • Reply 11 of 49
    Quote:

    Originally Posted by smalM View Post

     

    It will make a dent in their profits (revenue 197 bn $ / profit 26 bn $ in the last 4 quarters). 


     

    No way that Samsung would go Bankrupt. Its a conglomerate. And, i am sure of the billions of stupids who still buys Samsung products. So, sorry!

  • Reply 12 of 49
    The whole idea of a hatred between Apple and Samsung is simply to deter an antitrust allegation, lesson learned from Microsoft. It's interesting how Google's Android spawned from a close relationship and suddenly turned to "stealing"- reality was that Jobs gave it to Schmidt to have a friend in charge of the competition. No one would keep up with iOS otherwise. Then when the hardware market showed it couldn't keep up either, Apple recruited HTC but settled on Samsung. Don't let the lawsuits fool you, they're just a dog and pony show. All these companies are in bed together. Not that it's a bad thing, they seem to be doing the right thing with it- healthy competition.
  • Reply 13 of 49
    Just because Samsung didn't say anything about their 64 bit roadmap prior to the announcement of the A7 doesn't conclusively prove anything. I still wouldn't trust them. Also, keeping the internal architecture of a new processor secret is far easier than say the design of a new case or camera which would have an obvious physical difference to many factory staff. It's not like anyone can look at the chips rolling off the plant, or even the very rare few with access to the designs, and easily proclaim it to be 64 bit... That's why the info stayed private...
  • Reply 14 of 49

    Actually this makes lots of senses, not that I would not like to see apple pull all its business from Samsung to teach them lesson about who is paying their bills. However, Apple took a large risk putting all it productions in Samsung in the first place. The same would be true for putting it all in TSMC. It is smart to split the business. Plus it allows apple to pit each supplier against one another. Now Mothership Samsung has to decide is it worth losing apple all together to allow the Samsung phone guys insight into apples doing as well as selling internally at the same price they sell to Apple. It makes the dynamics more complicated for Samsung that is for sure.

  • Reply 15 of 49
    jragostajragosta Posts: 10,473member
    chandra69 wrote: »
    No way that Samsung would go Bankrupt. Its a conglomerate. And, i am sure of the billions of stupids who still buys Samsung products. So, sorry!

    I don't think anyone said that Samsung would go bankrupt. But losing a few billion dollars in orders would definitely hurt.
    A rumor out of the Far East on Sunday claims Apple has once again retained Samsung's services to build a next-generation processor dubbed the "A8," though a majority of production will reportedly be handled by Taiwan Semiconductor Manufacturing Co.

    "Well, this rumor wasn't true the last 10 times we tried to pass it off, but it should be good for a few more tries, so let's have another go at it."
  • Reply 16 of 49
    froodfrood Posts: 771member
    Quote:

    Originally Posted by s2kip View Post



    TSMC is leading in 28 nm. Why is Apple still stuck with samsung? Qualcomm, Nvidia all rely on TSMC.

     

    TSMC struggled to meet Qualcomms and Nvidia's demands and almost lost them as customers.  Those are their #1 and #2 customers.  Apple will be the new number one.  While I'm sure they are being told 'nothing will change' with Apple becoming their biggest customer, we all now that things *do* change when you are no longer the top tog.  I wouldn't be surprised if one of them seek a new supplier.  Hopefully TSMC can deliver for Apple as well as Samsung has.

     

    I really think Apple did this right, as the temptation to cut everything Samsung must have been tremendous.  Rolling in a new supplier while phasing out the old is a much better way to go.  Actually, keeping a second source handy is even better.

     

    Samsung outsources a huge percentage of its manufacturing for its own devices to third party companies.  Apple leaving Samsung would just mean they shift their outsourced business back in house- so its those third party manufacturers that would be left in the lurch, not Samsung.

     

    I would like to see Apple build some venture in NY in the good old USA.

  • Reply 17 of 49
    People can argue whether or not Samsung, TSMC or another party will build the next A Series chip until you're blue in the face, but that doesn't make it relevant.

    What is relevant (and also happens to be 100% true) are the following facts:

    - The A7 is the worlds most advanced, most powerful and efficient mobile SoC you can get.
    - The reason the A7 can lay claim to this title is due to the fact that Apple is far ahead of Qualcomm and even ARM when it comes to designing processors.
    - Samsung still has yet to deliver any custom designed SoC (or even announce one).
    - Samsung has to to rely on Qualcomm SoC's for their high-end devices as they outperform Exynos.
    - Apple has not only beat veryone to 64bit, but they are in a position to be 100% 64bit in only 2 years and have a smooth transition while doing so.
    - Samsung is in no position to dictate when they will be able to go 64bit since they only control half of their product (the hardware). And no, It's highly unlikely Tizen will be 64bit.
  • Reply 18 of 49
    cnocbuicnocbui Posts: 3,613member
    Quote:

    Originally Posted by Chandra69 View Post

     

     

    No way that Samsung would go Bankrupt. Its a conglomerate. And, i am sure of the billions of stupids who still buys Samsung products. So, sorry!


    Among those 'stupids' who buy Samsung products, you would have to put Apple at the very top of the list.

  • Reply 19 of 49
    cnocbuicnocbui Posts: 3,613member
    Quote:

    Originally Posted by EricTheHalfBee View Post



    People can argue whether or not Samsung, TSMC or another party will build the next A Series chip until you're blue in the face, but that doesn't make it relevant.



    What is relevant (and also happens to be 100% true) are the following facts:



    - The A7 is the worlds most advanced, most powerful and efficient mobile SoC you can get.

    - The reason the A7 can lay claim to this title is due to the fact that Apple is far ahead of Qualcomm and even ARM when it comes to designing processors.

    - Samsung still has yet to deliver any custom designed SoC (or even announce one).

    - Samsung has to to rely on Qualcomm SoC's for their high-end devices as they outperform Exynos.

    - Apple has not only beat veryone to 64bit, but they are in a position to be 100% 64bit in only 2 years and have a smooth transition while doing so.

    - Samsung is in no position to dictate when they will be able to go 64bit since they only control half of their product (the hardware). And no, It's highly unlikely Tizen will be 64bit.

    Wrong on every level.

  • Reply 20 of 49
    Quote:

    Originally Posted by cnocbui View Post

     
    Quote:
    Originally Posted by Chandra69 View Post

     

     

    No way that Samsung would go Bankrupt. Its a conglomerate. And, i am sure of the billions of stupids who still buys Samsung products. So, sorry!


    Among those 'stupids' who buy Samsung products, you would have to put Apple at the very top of the list.


     

    Not really. Samsung is the best at manufacturing and some of their products.

     

    But the galaxy line? Only for ignorant people. That's nothing you can do about it. They have inferior devices with higher prices and sell them based on advertising alone. Inferior device for inferior people. Well done, actually.

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