Considering Apple funds a lot of TSMC's R&D I dare say they have a lot of leverage if they really wanna push it.
No, but they can use their massive war chest and expertise to ramp up a competitor or become one themselves over the next decade or two. With massive corporate ships like TSMC and Apple it takes a long time to change course but they work on longer timelines so a big negative shift over a long time scale is an alarming signal.
Remember when there was no way that Apple would ever be able to move away from Moto?
Remember when there was no way that Apple would ever be able to move away from IBM/Power?
Remember when there was no way that Apple would ever be able to move away from Intel?
If you think Apple can just buy their way into fab success, you don't understand the complexities of semiconductor manufacturing.
Eh. Might know a thing or two, but I'm sure you know what you're talking about.
Have a great day!
No one is saying they can "just" buy their way into fab success. However, I think they do have the cash and clout to make it happen on a decade long timeline, possibly in league with Intel/Samsung or the US Government, or all three, etc. Obviously that would be enormously costly and risky, but any move to eventually do so is a threat to TSMC, so even if they don't do it they have a negotiating position with TSMC right now because the relationship is enormously valuable.
Sure, but how are they going to produce iPads and iPhones before then? They can't have more than a year's worth of CPUs stockpiled.
From TSMC chips. Basically if TSMC insists on raising prices to levels above what Apple is prepared to pay they can threaten to move away from TSMC eventually. If TSMC refuses to budge then Apple will have to pay the higher prices in the short to medium term and then expend capital to not be beholden to TSMC over the long term. So then the question is does TSMC value the relationship over the long term or do they value the higher prices in the short to medium term? That could be Apple's negotiating position.
I suspect if Apple really wanted to they would probably start to produce their products in two lines like Nvidia did, with cheaper phones produced on something like Samsungs 4nm and the higher end phones on TSMCS 3nm.
This has the added benefit of diversifying their supply chain (to a degree), giving TSMC less leverage over Apple and potentially reducing the production cost of the lower end phones.
Wouldn't be the first time Apple has used multiple vendors for their SOC. The 6s for example had SOCs made by both Samsung (14nm) and TMSC (16nm).
I wonder how they would react if they were offered 25% of Apple's 3nm capacity at the higher price.
This could be a good lesson for everybody.
Sounds like they're playing a game of chicken.
Apple could with some pain replace TSMC but TSMC can't really replace Apple. While Apple is a demanding partner they pay their bills on time and can and do front R&D money. Once Apple's deliveries are made TSMC now has a money printer on the new process node Apple paid for.
If TMSC rejects Apple, what is Apple going to do? Use Intel chips in iPhones?
They announced they would do that in March 2021 (https://www.techpowerup.com/280085/intel-to-enter-third-part...) and have customers:
- QualComm and Amazon AWS: https://www.theverge.com/2021/7/26/22595002/intel-qualcomm-c...
- MediaTek (https://www.tomshardware.com/news/intels-foundry-services-la...)
Intel page: https://www.intel.com/content/www/us/en/foundry/intel-foundr...
2) There is only one TSMC. If you could just buy one for 500bn the EU would have bought 3 already. Building your own TSMC from scratch takes a decade, if not longer.
I bet if you try the US and EU quietly tell you to stop, because Taiwan without a TSMC monopoly would be very scared.
> China throws billions for decades
PRC's first pseudo-serious semi push was 2014 big funds, so far they've spent about 50B, over 8 years. That's less than annual R&D of western semi sector. And basically for first 5 years it wasn't a very serious effort until Trump's Huawei sanctions. PRC semi poached about ~3000 semi engineers from TW, a few hundred top talent from TSMC, and that was enough to realize the recent 7nm breakthrough on DUV in the last couple years once PRC semi started to get serious. US companies wouldn't have any issue accessing western equipment and US could absolutely pressure TSMC / TW into further semi capitulation. So maybe dropping cash and add political sticks to brain drain TSMC. The secret isn't to recreate TSMC, but to paperclip all their people and get to to build US-SMC state side.
> lost chip war
That remains to be seen, so far there hasn't been any sector PRC couldn't successfully indigenize in relatively short order once central gov started turning the screws. It might not be leading edge, or even commercially competitive, but it will likely be enough. They could also destroy critical East Asian semi supply chain before US can reshore in next few years and be the only country with the most comprehensive indigenous semi supply chain even if on older nodes. Still lots of ways chip war can play out.
This sounds like the same neoliberal fantasy that trapped Europe into an energy crisis.
They are not desktop or laptop chips though. Targeted at miners. If you are willing you could probably reverse engineer them and do some fun stuff. But they are definitely not general purpose.
Apple is probably weaker because it’s likely someone else can fund the newest node for TSMC, just might take more work.