Samsung to replace TSMC as Apple & Qualcomm's CPU supplier

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WarpDrive

Limp Gawd
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Seems like the awkward Samsung-Apple relationship will start again very soon as TSMC lacks the technological capacity required for manufacturing 14nm CPUs.

Any comments on this? This is pretty big IMO. Samsung will also be supplying the majority of CPUs and SoCs to Qualcomm as well.

Good news for Samsung, horrible news for TSMC.

http://www.reuters.com/article/2014/07/17/us-tsmc-orders-idUSKBN0FM07C20140717
Taiwan's TSMC shares fall on Apple, Qualcomm order loss reports

(Reuters) - Shares of Taiwan Semiconductor Manufacturing Co Ltd (TSMC) fell as much as 6 percent on Thursday after an analyst and Taiwanese media reported the likely loss of orders for next-generation chips from Apple Inc and Qualcomm Inc.

The world's largest contract chip manufacturer on Wednesday reported its highest quarterly profit since the end of 2006, and said it expected revenue to grow at least a record 20 percent this year.

Behind the bullish outlook was likely increased demand from Apple which recently chose TSMC over Samsung Electronics Co Ltd to make the majority of chips for the successor to its iPhone 5 series of smartphones, industry insiders said.

But both Apple and Qualcomm will likely buy a larger proportion of 14 nanometer smartphone chips from Samsung rather than TSMC beginning in the second half of 2015, KGI Securities analyst Michael Liu said in a note to clients.

Liu did not detail the source of the information in the note, issued late on Wednesday following an investor conference held after TSMC reported second-quarter earnings.

The Commercial Times on Thursday, citing market speculation, said Qualcomm has already started working with Samsung to develop the chips. The Economic Daily News said without citing sources that Qualcomm had placed orders with Samsung.

The reports sent shares of TSMC down as much as 5.75 percent in Thursday trade compared with a 1 percent decline in the benchmark index.

Yuanta Securities Analyst George Chang, who also attended the conference, said of Apple and Qualcomm on Thursday that "This is still just a lot of speculation."

"We haven't even seen the iPhone 6 yet, so it's too early to say anything about future products," Chang said.

During the conference, TSMC Chairman Morris Chang said the company's market share in 16 nanometer chips - which perform similarly to 14 nanometer chips - will be smaller than "a major competitor" next year, and that TSMC will regain a leading share from 2016.

The size of chips in the latest high-end smartphones is 28 nanometers, according to TSMC.

On Thursday, spokespeople at TSMC in Taiwan and Apple in China could not be reached for comment.

A Qualcomm representative in China said she had not seen the reports and so declined to comment. A Samsung representative in South Korea also said she had not seen the reports and declined to comment.

(Editing by Christopher Cushing)
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WarpDrive said:
Seems like the awkward Samsung-Apple relationship will start again very soon as TSMC lacks the technological capacity required for manufacturing 14nm CPUs.

Any comments on this? This is pretty big IMO. Samsung will also be supplying the majority of CPUs and SoCs to Qualcomm as well.

Good news for Samsung, horrible news for TSMC.

http://www.reuters.com/article/2014/07/17/us-tsmc-orders-idUSKBN0FM07C20140717
Click to expand...

Think we touched on this before, but note the big red flags in the language that suggest you shouldn't take this at face value:

"The likely loss" -- note that this doesn't say "confirmed."

"KGI Securities analyst Michael Liu said in a note to clients" -- he may be making it up to get customers.

"This is still just a lot of speculation" -- when even other analysts think Liu could be full of crap, you know something's up.

My general rule is to assume that all analysts are lying about inside sources by default, and to be pleasantly surprised if they're in any way accurate. I wouldn't rule out problems with TSMC's ability to make 14nm chips, but I wouldn't take them seriously unless TSMC gives clear signs that it lost Apple's business.
 
We aren't even at 20nm and we're supposed to believe 14nm will be ready by 2H 2015?
 
Samsung is ahead of schedule with 14 nm.

http://www.digitimes.com/news/a20140709PD203.html

If you look at the trend in node reduction at about -30% with every jump...

65 nm
45 nm
32 nm
22 nm
14 nm

then you'll see that 28 nm was an anomaly. Also, 22 nm isn't that significant of an advantage over the competition at 28 nm so it makes sense to push for 14 nm where the end result is better performance, minimal throttling, lower power consumption under load and when idle that will help win market share.

Don't know why Samsung let Apple patent troll come running back after leaving for TMSC out of spite. Samsung could've followed up with another wall hugger commercial touting 2 week battery with Galaxy S6 vs 2 days with iPhone 6.

http://youtu.be/mzMUTrTYD9s
 
Here's a hint: Apple is widely seen as Samsung's largest customer outside of itself. Especially given that Samsung is both being beaten in sales by Apple at the high end and Chinese/Indian OEMs at the low end, it can't afford to lose that kind of semiconductor business.

Also, there's this whole concept of antitrust law. Maybe you've heard of it? Even in South Korea, it would likely face charges if it purposefully denied supply contracts to its biggest competitor. The company is already in trouble with the EU for illegally abusing standards-based patents; it doesn't need to get further grief.
 
mi7chy said:
Samsung is ahead of schedule with 14 nm.

http://www.digitimes.com/news/a20140709PD203.html

If you look at the trend in node reduction at about -30% with every jump...

65 nm
45 nm
32 nm
22 nm
14 nm

then you'll see that 28 nm was an anomaly. Also, 22 nm isn't that significant of an advantage over the competition at 28 nm so it makes sense to push for 14 nm where the end result is better performance, minimal throttling, lower power consumption under load and when idle that will help win market share.

Don't know why Samsung let Apple patent troll come running back after leaving for TMSC out of spite. Samsung could've followed up with another wall hugger commercial touting 2 week battery with Galaxy S6 vs 2 days with iPhone 6.

http://youtu.be/mzMUTrTYD9s
Click to expand...

Good point.

Samsung makes pretty big leaps with technology. Wouldn't be surprised at all if 14nm is introduced next year. Samsung and Intel will get to utilize 14nm technology before everyone else.

TSMC will still be stuck at 28nm.
 
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