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Apple Renews Contract With Samsung Over A-Series Processors

samzenpus posted about a year ago | from the still-partners dept.

Businesses 101

tlhIngan writes "In an interesting move since Apple decided to partner with TSMC a few weeks ago, the Korea Economic Daily is reporting that Apple has re-signed a contract with Samsung to produce the A-series chips Apple uses to power its iPads, iPhones and iPods. TSMC is still to produce chips for Apple, though Samsung is poised to take over from 2015."

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Simple business decision (2)

ackthpt (218170) | about a year ago | (#44289127)

Apple knows which side of the iPad the butter goes.

Re:Simple business decision (2)

Bill_the_Engineer (772575) | about a year ago | (#44289141)

More like Apple learned the danger of having single-sourced components a long time ago.

Re:Simple business decision (-1, Flamebait)

noh8rz8 (2716593) | about a year ago | (#44289357)

News for fanbois; stuff that doesn't matter

Re:Simple business decision (2)

Anonymous Coward | about a year ago | (#44289693)

If you aren't interested in the story, I suggest you don't click on it and spare us your bitching.

Re: Simple business decision (-1)

Anonymous Coward | about a year ago | (#44289877)

Says someone that won't bother to get an account.

Re: Simple business decision (0)

Anonymous Coward | about a year ago | (#44290005)

I have one but even without the karma bonus starting at +1 is still too much for this waste of a thread.

Re:Simple business decision (0)

Anonymous Coward | about a year ago | (#44290219)

The irony. You're bitching about him bitching. That's pretty funny.

Re:Simple business decision (1)

93 Escort Wagon (326346) | about a year ago | (#44290553)

A moose bit my sister once. No, really!

Re: Simple business decision (0)

Anonymous Coward | about a year ago | (#44291735)

I bit my sister once, but don't worry, I wasn't being mean, just a love nibble on her clit.

Re:Simple business decision (0)

Anonymous Coward | about a year ago | (#44296745)

Wow, a look at your user name... is that hypocricy or irony?

Re:Simple business decision (2, Interesting)

Anonymous Coward | about a year ago | (#44289379)

It's not like Samsung is going to turn down a contract with one of the world's largest device makers either. It's guaranteed business.

Apple makes a lot of devices. Some will continue with Samsung designs. (No brainer. Refine, upgrade, sell next version. No reason to shake up a product line that's selling well) And some will use Apple's new chips fapped at TSMC.

That said, it would suck if your main competitor in the high end smartphone biz decided to squeeze your supplies because they felt it convenient to do so. Samsung is a monstrous company with plenty of dirty business under it's belt. They practically control the SK govt and operate with impunity in that country. If you live in SK, you don't cross that company. Ever.

Re:Simple business decision (1)

fredprado (2569351) | about a year ago | (#44289461)

Seems like Apple in US...

Re:Simple business decision (5, Informative)

ShanghaiBill (739463) | about a year ago | (#44289609)

Seems like Apple in US...

Not even close. Samsung accounts for nearly 20% of the Korean economy. Much of the rest of the economy is controlled by one of the other four big chaebol (conglomerates). Samsung has their tentacles into every part of the economy and government. Many politicians have close links to company, and many are open about being in their pocket because "what's good for Samsung is good for Korea!" In the past, whenever Samsung wanted to enter a new line of business, the government would inform their incumbent competitors to either sell out, shut down, or face the consequences (audits, arson, arrest, etc.). Today it is just a bit more subtle.

Re:Simple business decision (0)

fredprado (2569351) | about a year ago | (#44289805)

Apple certainly do't represent anywhere close 20% of Us economy but after some point this is irrelevant. Apple can get away with whatever it does in US, at least as much as Samsung can in Korea.

Re:Simple business decision (3, Insightful)

ShanghaiBill (739463) | about a year ago | (#44289949)

Apple can get away with whatever it does in US, at least as much as Samsung can in Korea.

You should read up on the history of Samsung, the history of Korea, the intertwined political/economic dynasties, and the current state of politics in Korea before you make such a ridiculous statement.

Re:Simple business decision (-1, Flamebait)

fredprado (2569351) | about a year ago | (#44290061)

You, on the other hand, should make a reality check and realize that the corporations own US, and Apple has a big share.

Re:Simple business decision (4, Informative)

oxdas (2447598) | about a year ago | (#44290729)

Samsung takes it to a whole new level. Their CEO has been convicted of felonies twice (two separate occations) and had the verdict put aside because he was deemed too valuable to the Korean economy. American Corporations have power, but in Korea, Samsung, and to a lesser extent the other Chaebol, are truely above the law.

Re:Simple business decision (0, Offtopic)

fredprado (2569351) | about a year ago | (#44290965)

American corporations are guilty for millions of deaths in US alone, for negligence, omission and even for taking intended illegal risks, but because they are corporations their owners and CEOs don't even answer to criminal justice for most of that, and in the rare occasions they do they walk free. No, my friend, there is no sensible difference, regardless of how much you want to see it this way.

Re:Simple business decision (2)

oxdas (2447598) | about a year ago | (#44291755)

I have lived and worked for corporations in both places. I saw a difference. It may be one of degree, but it certainly was a difference.

Re:Simple business decision (1)

fredprado (2569351) | about a year ago | (#44292077)

Maybe your data is anecdotal. I am still to see somebody being condemned to pay hundreds of thousands of dollars for copyright infringement in Korea, for example. I am still to see someone being threatened with 30 years or more of prison for an attempt to share information that was publicly founded. I could go on and on. The influence corporations have in US is in excess of anything they have out there, even SK.

Re:Simple business decision (1)

oxdas (2447598) | about a year ago | (#44296561)

You should get out more. Corruption of government is not a U.S. phenomena. There are many counties that do it even better.

Re:Simple business decision (0)

Gumbercules!! (1158841) | about a year ago | (#44292061)

Why is this modded offtopic and his previous response flamebait? It's no more flamebait or offtopic than the guy he's replying to...Samsung may have a serious level of control in Korea (I've personally never researched this so I don't know how true the above comments are) but in the US, you cannot make a serious argument that corporations don't frequently act above the law and get away with it, surely? There's countless examples of corporations breaking the law with actual deaths occurring as a result and no one getting penalised.

Re:Simple business decision (0)

Anonymous Coward | about a year ago | (#44294425)

Samsung may have a serious level of control in Korea (I've personally never researched this so I don't know how true the above comments are) but in the US, you cannot make a serious argument that corporations don't frequently act above the law and get away with it, surely?

http://www.globalmon.org.hk/content/condemn-samsung-killing-workers [globalmon.org.hk]

Re:Simple business decision (0)

Anonymous Coward | about a year ago | (#44295629)

What's the Korean word for "hyperbole"?

Re:Simple business decision (0)

Anonymous Coward | about a year ago | (#44298581)

They don't have that much power, or they would have eradicated our bloated and business-unfriendly government a long time ago.

Re:Simple business decision (3, Insightful)

Rockoon (1252108) | about a year ago | (#44291613)

Our CEO's are powerful enough to avoid being convicted of felonies to begin with.

Re:Simple business decision (1)

oxdas (2447598) | about a year ago | (#44291885)

That should give you an idea of the power of the Chaebol in Korea. They can be absolutely brazen and still get away with it. In the U.S., there is still a line that cannot be crossed.

Lee Gun Hee's first presidential pardon came after a conviction for bribing the President of South Korea. Can you image if irrefutable evidence emerged that Tim Cook had given bribes to Barack Obama (direct quid pro quo, not campaign contributions)? His next presidential pardon came about 10 years later when he admitted publicly to tax evasion and embezzelment, so it was an open and shut case. CEO's have a lot of power in the U.S., but it is on another level in Korea.

Re:Simple business decision (0)

Anonymous Coward | about a year ago | (#44297767)

Lee Gun Hee's first presidential pardon came after a conviction for bribing the President of South Korea.

Yeah, here bribing is called donating or a political contribution.

Re:Simple business decision (0)

Anonymous Coward | about a year ago | (#44302699)

Except for Kenneth Lay, John Rigas, Bernie Ebbers...

Re:Simple business decision (1)

R3d M3rcury (871886) | about a year ago | (#44291343)

Which is why they were so successful fighting the DOJ.

Re: Simple business decision (0)

Anonymous Coward | about a year ago | (#44290563)

heh you said fapped

Re:Simple business decision (3, Interesting)

binarylarry (1338699) | about a year ago | (#44289147)

It must be really hard to be the Apple guy in this situation.

You have to sit across from these people that have totally stolen your lunch and smile as you give them more business. Because you know if they decide to stop doing business with you, your other options are far, far worse.

Re:Simple business decision (0)

Anonymous Coward | about a year ago | (#44289259)

Tell me how this is the case of Apple getting its lunch stolen vs Samsung deciding to cut out the middle man?

Re:Simple business decision (-1)

Anonymous Coward | about a year ago | (#44289843)

you are an idiot.

Re:Simple business decision (1)

mbkennel (97636) | about a year ago | (#44289345)

"Your other options are far, far worse"

Apple could build a fabrication plant. Is that a really bad option?

Re:Simple business decision (2)

fredprado (2569351) | about a year ago | (#44289481)

In the long term maybe not. In the short term it is certainly worse, though, and everybody only thinks about the next Quarter these days...

Re:Simple business decision (1)

jittles (1613415) | about a year ago | (#44290117)

In the long term maybe not. In the short term it is certainly worse, though, and everybody only thinks about the next Quarter these days...

Well Apple could very well go out of business if it has no products to sell while they spend 8-10 years opening up their own fab facility. Unless they want to fab in some country where permits are easier to get. Then it might be half that time where they have no processors to put in their products. Of course, I am sure they could find other vendors, but how many independent fabs are out there that can handle that kind of volume reliably?

Re:Simple business decision (1)

fredprado (2569351) | about a year ago | (#44290195)

Nobody is suggesting that they, all of a sudden, just stop buying components and wait for their plants to become operational.

Re: Simple business decision (1)

alen (225700) | about a year ago | (#44289493)

Duh, yeah

Since you need people to run it.

Intel and others spend years working out the kinks in manufacturing. How many times has amd and nvidia missed launches due to poor yields?

Re: Simple business decision (0)

Anonymous Coward | about a year ago | (#44290111)

How many times has amd and nvidia missed launches due to poor yields?

When the foundry misses a launch data that causes the Manufacturer to miss a launch date too. Look at the new Mac Pro. Apple can't release it until Intel is finished with the chips it needs. Apple is no worse off if they miss a launch date in their own foundry than if a third part foundry missed a launch date.

Apple's never run a foundry (1)

raymorris (2726007) | about a year ago | (#44292119)

Apple doesn't have Samsung's experience in fab, so it stands to reason they'd have a lot more screw ups, making the same mistakes Samsung already made 20-30 years ago.

It's a $4-9 Billion Option (4, Informative)

Nova Express (100383) | about a year ago | (#44289547)

Apple could do it, but it's a very expensive bet.

TSMC spent $9.4 billion [reuters.com] on their latest 300mm fab, and it will be running pretty much 24/7/365 for many, many years. And if Apple broke ground tomorrow, it's still likely to be 3 years before the fab is fully built, equipped, staffed, qualified, and running at full speed. Unless Apple is sure it can get chip volume high enough to achieve real cost savings, it's probably not worth doing.

And by then the industry might have started transitioning to 450mm.

Apple is one of the few companies in the world who could drop that much out of actual cash-on-hand without blinking, but it's a very risky bet with potentially a lot more risk than reward.

Re:It's a $4-9 Billion Option (1)

Anonymous Coward | about a year ago | (#44290015)

TSMC spent $9.4 billion [reuters.com] on their latest 300mm fab, and it will be running pretty much 24/7/365 for many, many years. And if Apple broke ground tomorrow, it's still likely to be 3 years before the fab is fully built, equipped, staffed, qualified, and running at full speed.

Apple makes more than $9.4 billion every quarter, for their lowest quarter. That spread that over 3 years assuming that 9.4 billion stays constant every quarter an note that ~$9.4 is about their lowest quarter profit in a year. This $9.4 billion dollar expenditure represents only ~8% of their total profit earned in that three year period.

Bottom line, it's a bet that Apple can afford to lose.

Re:It's a $4-9 Billion Option (2)

Rockoon (1252108) | about a year ago | (#44291721)

Its a bet that is practically guaranteed to lose, so just like the lottery.

The issue isnt if they can they afford it. The issue is if it will save them money. It wont.

Apple would not just have to build the FAB, but they would also have to sell its service to others in order to make it worthwhile. Then they are in the full FAB business and then its not just $9.4 billion.. its $100 billion in R&D over the next 10 years, not to mention landing CxO's thats in-the-know about being a supplier and can make that work.

There is a reason that companies like Motorola got the fuck out of the FAB business.

Thinking about money is so short-sighted... (1)

SuperKendall (25149) | about a year ago | (#44293163)

The issue is if it will save them money. It wont.

That is quite frankly utterly irrelevant, even if it cost them 1.5x as much to make each part.

The reason to have your own fab is that then you have a chance at controlling leaks - and you don't give a competitor a chance to copy what you are doing right off the assembly line from original design documents, you have to reverse engineer it like everyone else.

It gives Apple a year +buffer on industrial espionage. That is priceless.

Apple would not just have to build the FAB, but they would also have to sell its service to others in order to make it worthwhile.

You haven't kept track of number of units Apple sells per quarter, have you? Apple can easily consume the output of a custom fab facility.

Re:Thinking about money is so short-sighted... (1)

Anonymous Coward | about a year ago | (#44293965)

And what does Apple do about all the patented tech that they would need to either reverse engineer or license just to get started? 9.4B is a very, very low number. Apple has a lot of cash, but not enough to pay those. The fab business is entrenched in a way that very few other businesses are.

Re:Thinking about money is so short-sighted... (1)

Rockoon (1252108) | about a year ago | (#44295201)

You seem to think that FAB's upgrade themselves.

Lets suppose that Apple builds of 65nm FAB for pushing out their custom ARM chips.. if they keep using it for 10 years, they will be 10 years behind the curve at the end of it.

That first year or two they might be able to use and sell 100% of the FAB's capacity inside their own products if they were bang on in sizing it (how do they know how much product they are going to sell next year?), but after that their products would be crap if they kept using it for the same purpose. FAB's get around this problem by altering what they use the FABs for over time. At the beginning its cutting edge chips, but at the end its support chips for shit like drive controllers, routers, and so on.

If you think that Apple can move as many AirPlays as they do iPhones, then you are completely retarded.

WHOOSH (2)

SuperKendall (25149) | about a year ago | (#44298365)

You seem to have utterly missed my point that money does not matter, this is about control.

You seem to be ignorant as to what Apple would do with chips produced (as in potentially every product, not just AppleTV's).

You seem to be dumb enough to think that Apple wouldn't upgrade the FAB over time...

Basically, you just aren't thinking.

Re:It's a $4-9 Billion Option (0)

Anonymous Coward | about a year ago | (#44291747)

No, it's a bet that Apple is guaranteed to lose, due to differences in business model.

TSMC can keep a fab running for many, many years, long after marquee customers like Apple have moved on to another fab with more advanced process, by simply targeting lower-end chips instead. They can afford to do this because they are a dedicated fab, and can absorb all sorts of demands from high end customers and low end customers alike.

Apple, on the other hand, has highly specialized chip requirements because they only make a few types of high-end products. Once Apple decide to move the A series processor to an even better fab, they would be stuck with an old fab that can't make anything useful for them. Short of becoming a fab themselves, the only thing they can do is to sell it off at fire-sale price to a fab operator like TSMC.

End result: it is cheaper for Apple, or almost any other semiconductor developer, to "rent" fab capacity at TSMC or Samsung than to build it themselves.

Re:It's a $4-9 Billion Option (0)

Anonymous Coward | about a year ago | (#44293109)

There are more chips in any device than just the CPU. These can be made on the other processes keeping apples fab running longer.

Re:Simple business decision (2, Funny)

tooslickvan (1061814) | about a year ago | (#44289197)

The glass side is the butter side since the iPad always lands glass-side down.

Re:Simple business decision (1, Funny)

K. S. Kyosuke (729550) | about a year ago | (#44289473)

I believe you can protect your iPad's screen by buttering the back.

Re:Simple business decision (1)

icebike (68054) | about a year ago | (#44289323)

Apple knows which side of the iPad the butter goes.

And Apple found out its not a simple as they thought to produce in quantity. I hope Samsung dictated a price increase sufficient to cover any Apple law suits.

Re:Simple business decision (3, Insightful)

ygtai (1330807) | about a year ago | (#44289457)

The reality may simply be Samsung offered a very low price that Apple cannot refuse. TSMC, while maintaining a 40%+ profit margin, doesn't have to lower its price; customers are well queued in line. However Samsung wants to expand their foundry business badly.

Re:Simple business decision (2)

icebike (68054) | about a year ago | (#44289715)

However Samsung wants to expand their foundry business badly.

What is your source for this?
The only reason they would want to expand their foundry business would be if it was hugely profitable, and offering Apple even bigger discounts than they already were getting would make it LESS profitable. Further, Samsung already can handle Apple's total chip requirements, so this wouldn't involve an expansion at all.

Samsung might not want to IDLE any of their foundries by losing Apple business, but with Android sales surging to 70% market share [techcrunch.com] world wide, there is little risk of that having any long term effect.

Re:Simple business decision (1)

ArsonSmith (13997) | about a year ago | (#44290029)

It can be less profitable if they plan to make up for it in volume. Opening more fabs/foundries would make this the case.

Sometimes the anti free market stance on Slashdot is amazing. Few fortunes have ever been made by trying to find a way to sell things for more. (not zero, but still few) They have always been find a way to make things of the same or acceptably less quality but be significantly cheaper so has to sell higher volumes.

Re:Simple business decision (1)

icebike (68054) | about a year ago | (#44290113)

Few fortunes have ever been made by trying to find a way to sell things for more.

Nonsense. Fortunes are made by trying to exact the maximum profit possible. Sometimes that means a lower price, in the hopes of making it up on volume, but more often than not, the process involves seeking a higher price via any means possible. Better product, buying up the competition, what ever.

It is a sorry study of history that suggests the road to riches is to offer the lowest price possible until forced to do so.

Re:Simple business decision (1)

ArsonSmith (13997) | about a year ago | (#44292405)

Complete and utter horse shit. Ford, Walmart, Intel, Microsoft,sears, all companies that made their fortunes by finding a way to sell things cheaper.

Re:Simple business decision (1)

oxdas (2447598) | about a year ago | (#44290877)

Samsung just increased the prices 30% in November of last year for the chips they were already making. There aren't many companies with the capabilities to manufacture these chips in Apple's volumes. I suspect Samsung is make quite a profit on these chips and this is more an issue with Apple unable to find other sources for these chips (it is rumored that Apple had put a chunk into GlobalFoundries in the hopes of turning them into a viable source).

Re:Simple business decision (1)

ygtai (1330807) | about a year ago | (#44290725)

What I said about "expand" might not be very accurate. What I meant was they want to expand into the pure-play foundry business. While Samsung's smartphone business is earning a lot, it's semiconductor wing's profit is very thin or at the brink of losing money with its huge capacity. In the meantime, the pure-play market is still in the state of greater demand than supply. Samsung Semiconductor wants that market. They stated that in their own brochure. And that's why they poached TSMC's former R&D chief. They are still far behind in the pure-play business, and it's natural they lower price in pursuit of bigger market share, as what they have done in the very beginning of their other businesses. Though I have to admit I'm just doing educated guess...

Re:Simple business decision (1)

mjwx (966435) | about a year ago | (#44292095)

However Samsung wants to expand their foundry business badly.

What is your source for this?
The only reason they would want to expand their foundry business would be if it was hugely profitable, and offering Apple even bigger discounts than they already were getting would make it LESS profitable. Further, Samsung already can handle Apple's total chip requirements, so this wouldn't involve an expansion at all.

Samsung might not want to IDLE any of their foundries by losing Apple business, but with Android sales surging to 70% market share [techcrunch.com] world wide, there is little risk of that having any long term effect.

This.

It's a case of Apple needing Samsung because Samsung can deliver the volume and quality Apple want.

Samsung is simply not vindictive, so they're not turning down the contract.

Re:Simple business decision (0)

Anonymous Coward | about a year ago | (#44294507)

However Samsung wants to expand their foundry business badly.

What is your source for this?

The same as the source for this story - somebody's ass.

Re:Simple business decision (1)

tlhIngan (30335) | about a year ago | (#44297257)

The only reason they would want to expand their foundry business would be if it was hugely profitable, and offering Apple even bigger discounts than they already were getting would make it LESS profitable. Further, Samsung already can handle Apple's total chip requirements, so this wouldn't involve an expansion at all.

Samsung might not want to IDLE any of their foundries by losing Apple business, but with Android sales surging to 70% market share world wide, there is little risk of that having any long term effect.

Fabs are expensive. If they're not running 24/7/365, they're costing money. It takes billions to open a fab, only to have in 18 months having to pay out a significant chunk of that money AGAIN to buy all new fab equipment because technology marches on.

It's why there are few people with fabs around the world - Intel, Global Foundries (AMD), TSMC, Samsung, Toshiba and a handful of others.

Oh yeah, each fab is different! The one optimized for making RAM isn't as good for making CPUs, the one making CPUs isn't as good for making RAM, and Flash lines just don't do well for either as well. Each kind of device requires special processing without which makes it suboptimal. (It's why embedded flash or embedded RAM just is never as good - or we'd be sticking RAM and Flash on die already).

So one fab becomes many and each needs new sites to accommodate new nodes (the older nodes are still useful for other things to help amortize the costs).

As for Android? Most of that 70% marketshare are for crap-droids with piss-poor screens, anemic processors, and RAM under 1GB. The flagships, even popular ones like the SGS3 make up only a tiny proportion of actual sales (the SGS3 is probably around 10% of the entire Android market). Most of that 70% goes to other fabs like TSMC (Qualcomm, MediaTek, etc), and will contain whatever crap is on sale that week.

It's why Intel sells foundry services to small companies - it helps top up their business, and also ensures they don't monopolize the fab. Fabs are just very capital intensive to run, and unless you can keep it going with parts continually, become a money sink.

Re:Simple business decision (0)

Anonymous Coward | about a year ago | (#44298589)

LOL 70% are crap-droids. More numbers pulled out the ass.

Apparently, the GS4/GS3 singlehandedly selling about 80% units of i phones is all crap and garbage.

Re:Simple business decision (0)

Anonymous Coward | about a year ago | (#44299863)

LOL 70% are crap-droids. More numbers pulled out the ass.

Apparently, the GS4/GS3 singlehandedly selling about 80% units of i phones is all crap and garbage.

You mean all GS3 & GS4 ever sold make up 80% of all iPhones sold in three quarters.

Re:Simple business decision (1)

AmiMoJo (196126) | about a year ago | (#44290133)

More likely TSMC couldn't guarantee yields at the sizes Apple wanted. It would be a disaster if Apple couldn't compete on performance/watt and TSMC are both unproven at this level and have had problems moving to smaller processes in the past.

Samsung won't be giving them any discounts. Apple has little choice but to use them because as they have discovered the only other company in the world that might be able to help them out, TSMC, is struggling to. There are other companies with fabs that can do the job, but they charge more than Apple is willing to pay, just like there are factories in the west that could assemble iPhones but Apple (and many other manufacturers) are not willing to pay their prices.

Samsung (1)

houbou (1097327) | about a year ago | (#44289261)

Eventually will have Apple right where they want them.. Out of the way..

Re:Samsung (5, Funny)

ObiWanKenblowme (718510) | about a year ago | (#44289331)

Then where would Samsung turn to for their product designs?

Re:Samsung (2, Funny)

fredprado (2569351) | about a year ago | (#44289485)

To the same place Apple did. ;)

Re:Samsung (0)

Anonymous Coward | about a year ago | (#44289701)

Cupertino?

Re:Samsung (1)

fredprado (2569351) | about a year ago | (#44289717)

Nah, Palm One, HP, MS and many others before them.

Re:Samsung (0)

Anonymous Coward | about a year ago | (#44289879)

LOL, those weren't even design references, much less actual good designs.

Re:Samsung (0)

fredprado (2569351) | about a year ago | (#44290071)

The real blind man is the one that refuses to see...

Re:Samsung (1)

Space cowboy (13680) | about a year ago | (#44290331)

Indeed.

Re:Samsung (1)

mjwx (966435) | about a year ago | (#44292121)

Then where would Samsung turn to for their product designs?

They'll just have to rip of Samsung's old designs themselves and cut out the middleman.

Pick a rumor, any rumor: (3, Insightful)

edxwelch (600979) | about a year ago | (#44289339)

so far:
TSMC to make Apple chips
GlobalFoundries to make Apple chips
Apple to buy it's own foundry
and now Samsung to make Apple chips

Re:Pick a rumor, any rumor: (1)

AlreadyStarted (523251) | about a year ago | (#44289397)

Yup, my opinion is that these analysts are fishing for clicks and have no idea what is going on. At least that's what sources familiar with the matter tell me.

Re:Pick a rumor, any rumor: (0)

Anonymous Coward | about a year ago | (#44289709)

Yup, my opinion is that these analysts are fishing for clicks and have no idea what is going on. At least that's what sources familiar with the matter tell me.

Read all about it in my ad revenue supported news site.

Not a rumor! (0)

Anonymous Coward | about a year ago | (#44289855)

Excalibur to make apple chips:

http://www.excaliburdehydrator.com/dehydrators

Re:Pick a rumor, any rumor: (3, Insightful)

BLToday (1777712) | about a year ago | (#44290139)

They may all be true.
TSMC: Apple is feeling them out with older Apple A-series designs for Apple TV.
GF: Maybe Apple is going to use the AMD's A-series APU (Xbox ONE and PS4) in some unknown device (console?) or iMac Retina. Apple needs fast graphic performance more than CPU performance on their Retina series of devices.
Samsung: A proven and reliable source, so Apple would have a lot of reasons to continue to use them.
Own fab: why not control your own destiny

Apple has bought a fab according to semiaccurate! (1)

IYagami (136831) | about a year ago | (#44289393)

http://semiaccurate.com/2013/07/12/apple-has-their-own-fab/ [semiaccurate.com]

Take it with a pinch of salt

Re:Apple has bought a fab according to semiaccurat (0)

Anonymous Coward | about a year ago | (#44289671)

Whatever is beyond that paywall is completely irrelevant to iphone/ipad chips. There is no way Apple could have bought something that had (1) the level of cutting edge process implementation required and (2) the capacity to provide enough volume for their sales. At best, they'll be able to prototype in-house and experiment with processor designs. Or perhaps make processors for some of the low-volume products they sell (airplay?)

Apple will never go for a full-featured foundry play, that is including node tech research and high enough volume for their needs. Even going for a double-digit percentage of their needs is going to be more of a hardware play than they'll ever want to be caught doing. There simply isn't enough margin in that for Apple - far better let someone else eat the risks of R&D and just play the suppliers against each other to lower prices.

Besides, Charlie seems to have kind of lost the plot lately. A pity, that is. Strong, the lure of the dark side is.

Re:Apple has bought a fab according to semiaccurat (1)

Groo Wanderer (180806) | about a year ago | (#44289697)

I lost the plot? Darn now what am I going to do this evening? :(

              -Charlie

Re: Apple has bought a fab according to semiaccura (0)

Anonymous Coward | about a year ago | (#44289909)

Spook the troops in Nam?

Re:Apple has bought a fab according to semiaccurat (2)

slew (2918) | about a year ago | (#44290209)

The rumor (depending on who you heard it from) is that Apple...

- is in negotiations to buy UMC outright
- is going to be a Fab investment partner in Chartered Semi or Global Foundaries (both are owned by Abu Dhabi's Advanced Technology Investment Co.)

Any of these options would give them a reasonably cutting edge process and the capacity to provide the chips they need. The advantage of Global is that it is a member of the same common platform [commonplatform.com] group as Samsung and IBM. Since Apple already fabs at Samsung, it's quite possible that they can easily port over all their custom ARM cpu designs to Global Foundaries co-owned Fab and tape out SOCs based on one CPU design. The added benefit of using Global Foundaries would be that it would allow them to avoid tipping off Samsung about how many wafers they are running or when they are taping out or what frequency their CPU runs at with what yield... Global is also looking for a partner to help build-out a monster $10B fab in upstate NY. I'm sure they are courting Apple big-time...

Of course, this rumor might be total BS, but at least it makes a modicum of sense...

Re:Apple has bought a fab according to semiaccurat (2)

Groo Wanderer (180806) | about a year ago | (#44296775)

You do realize that the UMC rumor came from the Mac sites who all wrote me asking for free access to essentially republish my work openly. Before I could even respond they flat out made up that I was saying it was UMC, which I did not do. They got this flash of inspiration from the metatags my editor put in. For some reason they picked out UMC and ignored the five other fabs in the tag list. Could it be that UMC was the last one? Did they miss that the tags get alphabetized by the system? Are they that ignorant? Don't answer the last one.

Short story is that the morons at the Mac sites flat out made up the UMC thing and attributed it to me. That is modern 'journalism' for you.

            -Charlie

I thank you for yo0r time (-1)

Anonymous Coward | about a year ago | (#44289483)

world's GAy Nigger the projEct is in

Think about this one people (4, Interesting)

Groo Wanderer (180806) | about a year ago | (#44289745)

Stop and think about this.

1) When was the last time Apple leaked plans like this?
2) The level of detail is too high for a 2015 part
3) Apple never gives the foundry product names
4) They also never specify time frames even to their foundry that far out.
5) Apple and Samsung are not on good terms.
6-17) See 5)
18) Apple is trying to get away from Samsung, cost is not an issue
19) Samsung is not any better than the other two common platform partners for tech.
20) Apple has signed with TSMC for 20nm
21) Losing Apple is a big deal for Samsung Semi, and enough of a big deal to be unpleasant for their stock
22) The source for the story is a Korean newspaper that is likely quite beholden to Samsung

You can draw your own conclusions from the above, mine is damage control on Samsung's part.

                -Charlie

Re:Think about this one people (2)

Anonymous Coward | about a year ago | (#44290321)

So let's think.

1) When was the last time Apple leaked plans like this?

Irrelevant. If it's a leak, it's not by Apple, but by Samsung. And leaks have been far more frequent since Jobs no longer had the power to unleash vengeance upon the leakers.

2) The level of detail is too high for a 2015 part

This is a good point. And 14nm finfet is quite speculative from Samsung. Still, it could be something like 'if you can pull it off we'll buy it' - not very likely in itself, but seeing the past performance of TMSC moving to new nodes, not completely impossible.

3) Apple never gives the foundry product names

Probably speculation in this one anyway.

4) They also never specify time frames even to their foundry that far out.

Seeing as 14nm is still quite a way off for anyone who's not Intel, planning further ahead might not be too unusual.

5) Apple and Samsung are not on good terms.

6-17) See 5)

18) Apple is trying to get away from Samsung, cost is not an issue

This does not increase likelihood, but it's not as bad as it sounds. Count the suppliers Apple can go to for this type of order Charlie, I know you can. Now imagine TMSC will as usual *ahem* develop 'difficulties' with the 14nm node initial runs.

19) Samsung is not any better than the other two common platform partners for tech.

You're rambling here. The other partners are IBM and GloFo. Neither has the capacity (available, that is) and the ARM expertise of Samsung. Well, IBM will probably not take Apple's order anyway, and GloFo, well, you know the answer to that one. So it's irrelevant.

20) Apple has signed with TSMC for 20nm

Rambling again? this is about 14nm, not 20nm. And Apple is yet to receive any meaningful volume from TMSC on those 20nm units. The rumour mill has them signed up for 16nm and 10nm as well, but that's not what you're arguing (and honestly, it's more likely Apple took out an option to sign up for the next nodes contingent on the 20nm performance)

21) Losing Apple is a big deal for Samsung Semi, and enough of a big deal to be unpleasant for their stock

Not really. It's all about margin, see?

22) The source for the story is a Korean newspaper that is likely quite beholden to Samsung

Aaaand ... a good point again, finally.

Really Charlie, the SNR here is a bit embarrassing. Do try to make a better argument next time, will you?

Re:Think about this one people (3, Insightful)

Cassini2 (956052) | about a year ago | (#44290569)

Apple is shipping 5.4 million iPhones and iPads per week. PC sales are at 5.9 million units per week. These numbers were pieced together from macworld [macworld.com] and reuters. [reuters.com] Assuming all of Apple's dreams come true, in 2015 Apple must plan for the case it is selling more processors than Intel, which will mean that Apple needs all the fab capacity it can get. Additionally, given the recent track record on new product launches at TSMC and GloFo, Apple needs a backup plan if one or more fab suppliers have problems.

Even if Apple purchased a new fab, additional reserve capacity might be needed. That may be enough to ink a deal with Samsung. Samsung is the only company with the proven ability to make enough cell phone and tablet processors to cover the majority of the world wide market, including Apple.

Re:Think about this one people (1)

Anne Thwacks (531696) | about a year ago | (#44293399)

Because markets dont saturate?

Oh, wait...

It's very simple (0)

Anonymous Coward | about a year ago | (#44289983)

Apple and Samsung both stand to make money off of this. Why wouldn't they do it? Because separate divisions are fighting legal battles? Let something like that get in the way of making money?

Apple/Samsung Dialog (4, Funny)

sl4shd0rk (755837) | about a year ago | (#44290365)

Apple: Rounded corners, square design! You loose sucka! Pay!
Samsung: *m-ok* here, have $450M.
Apple: Muahahaha!! *twirling mustache*

            (1 year later in Apple board room....)

Engineer: It's a new design. More cores, cache and video on die.
Exec: Great! Send those plans to TI!
Engineer: Uh... it's not something they can do
Exec: But we are investing in America! Get TI on the phone!
TI: The design is outside the capabilities of our manufacturing limits.
Exec: *m-ok* get Samsung on the phone...

Samsung: Muahahahaha! *twirling mustache*

Re:Apple/Samsung Dialog (2)

AmiMoJo (196126) | about a year ago | (#44294487)

Except that Samsung hasn't actually paid them, they are still appealing. Cool story though.

Paging Justice Dept (1)

oldhack (1037484) | about a year ago | (#44290853)

I think Apple and Samsung are putting on a bullshit show while colluding behind the scene.

FTC should look into it.

Apple rumor contradicts other Apple rumor! (1)

Anonymous Coward | about a year ago | (#44291225)

This just in! Latest Apple rumor reported as fact, and it appears to contradict previous Apple rumor!

yeah right (2, Funny)

slashmydots (2189826) | about a year ago | (#44292247)

I think they're going to pull a "Parks and Recs" on them and they'll open up the box of first chips and every one will have "go fuck yourself" etched into it and basically be solid ceramics.

Good guys team up! (2)

RubberDogBone (851604) | about a year ago | (#44292669)

Comic books don't interest me but I would not mind seeing some sort of hero team-up where companies like Samsung, Apple, Google, Nokia, even Microsoft, all used their powers together to make the world a better place instead of spending a lot of their time in communal battle, either actual, in courts, or in the minds of the rabid customer base.

It will never happen because shareholders would freak, and because competition spurs innovation. But it should not be inherently wrong for Apple to source parts from Samsung and allow the best apps Google can offer for iOs. The people who lose out when the territorial walls go up are in fact the customers.

On a broader level, the future of the human race may eventually depend upon companies and even countries putting aside differences to work together toward common goals, and it seems to me that we are generally unaccustomed to and perhaps incapable of that sort of cooperative effort, and as such, we may never inherit the stars because we're too busy suing each other about the patents on the latest space toilet seat.

Interesting insight into Apple's future products (0)

Anonymous Coward | about a year ago | (#44294459)

"Samsung Electronics will supply 14 nano A9 chips that will be used for Apple's iPhone 7."

IOW the whole article smells of bullshit.

It's the Process, Stupid (0)

Anonymous Coward | about a year ago | (#44295955)

It's all about the process - nothing more. Apple may have an excellenet design team, but they clearly don't have the necessary "process" folks. So they relied on Samsung, which does spend $$Billions on R&D for the IC process (fabrication) technology. Taking it from the labs to full scale production can take YEARS! Intel is the current leader @ 22 nm - TSMC is still having issues around 28nm. GF is also at 28nm, as is the most of the rest of the industry.
There are very few companies that actually do "research" into IC fabrication: Intel, IBM (w/GF Partners), Samsung - not many more. . . Besides being expensive to do all the research for the next node level, you then have to justify the expense of building the new plants to handle this. All very expensive.
Apple may reach agreements for "preferred" status when it comes to wafer starts. But they are thinking ahead 3-5 years here and where they want to be with their designs. 14-10 nm is the next node bump - haven't heard much about sub 10 nm that's anywhere close to reality. Until then, Apple will put there $$ where they can get the best return and will focus on what they do best: Making outstanding products.

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