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Comment by tedyoung | Hacker News Reader

Not in the next 10 years. Why would they? Fabs are extremely capital-intensive and take years to get up and running, when (like Taiwan Semi) knows how to do it. Intel has shown how hard it can be to do this right. Let TSM work on production (and hopefully get more/larger fabs in the USA up and running) and getting better at packing in the transistors, and let Apple improve the design (and software).

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> Why would they?

Because Apple has a lot of capital and they wouldn’t need to compete as hard for their share of tsmc production capacity.

I wouldn't considered Apple to be even competing.

They are by far the biggest customer and have a multi-faceted relationship e.g. OLEDs, Modems.

they are addicted to cheap labor.

How much labor is involved in semiconductor manufacturing? It's mostly automated, right?

To a man carrying an axe, everything is a tree.

Labour isn't particularly cheap in Taiwan

They’ve vertically integrated everything else, and they’ve had great success along the way. TSMC has other customers that compete with Apple for production capacity. And there’s geopolitical risk in the region where TSMC (currently) operates.

> They’ve vertically integrated everything else

What do you mean by this? Apple does very little manufacturing, they're famous for it.

They’ve vertically integrated basically everything except manufacturing. Even compared to other tech giants who are highly integrated, they do a ton.

>They’ve vertically integrated everything else

Only in that they design it, not in that they build it.

In that area they have "vertically integrated" nothing.

Apple hasn't been vertically integrated in any kind of manufacturing since the 90s. It's all built in China.

> They’ve vertically integrated everything else, and they’ve had great success along the way.

Why would they want to get into the low-margin, high-risk part of their supply chain, the bit where you can sink billions of dollars and have the value wiped out by a poor choice?

Especially when semiconductor manufacturing has become a major geopolitical flashpoint between China, EU, US etc.

Apple would be insane to get into the middle of it.

Why would they make their own M and A processors? They could continue to buy Intel chips and revert back to using PortalPlayer and Samsung chips. Chip designing is capital intensive and takes years to get up and running, when Intel and Samsung know how to do it.

They did buy PA Semi to get off the ground. TSMC is probably way too expensive though.

They also bought Passif Semiconductor, parts of Dialog Semiconductor, Intel's modem team, Xnor etc.

Designing chips isn’t capital intensive, making them is.

Apple designs their own CPUs, GPUs, SOCs, Modems etc.

And they dominate the competition in performance/power.

Because of the non-zero chance of Southeast Asian fabs becoming suddenly unavailable.

This. It's not a money-making play; it's a catastrophic insurance policy.

But Apple has a lot of capital, and could win massive political brownie points for doing so, especially if they promised that some percentage of fab capacity would be sold to other American firms.

TSMC is based in on the soil of one of America's allies.

An ally who China is dreaming of re-assimilating (or taken over, depending on which side of the view you are) since its inception.

China is engaging in ever more aggressive saber rattling and the total lack of any measurable reaction to their takeover of Hong Kong only has emboldened them. Who can guarantee Taiwan won't end up the same fate?

I am very aware of the situation, being a resident of Hong Kong, and it's completely different. Hong Kong is indisputably a part of the People's Republic of China, and the Basic Law (our Constitution) is part of the constitution of the PRC. The government of Hong Kong has always emphasised that Hong Kong is part of One Country.

Taiwan is completely self-governed at the moment and sees itself as an independent nation.

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