At this scale and volume, it's not really about good faith.

Changing fabs is non-trivial. If they pushed Apple to a point where they had to find an alternative (which is another story) and Apple did switch, they would have to work extra hard to get them back in the future. Apple wouldn't want to invest twice in changing back and forth.

On the other hand, TSMC knows that changing fabs is not really an option and Apple doesn't want to do it anyway, so they have leverage to squeeze.

At this level, everyone knows it's just business and it comes down to optimizing long-term risk/reward for each party.

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philistine 4 hours ago | parent | next [-]

Apple has used both Samsung and TSMC for its chips in the past. Until the A7 it was Samsung, A8 was TSMC, and the A9 was dual-sourced by both! Apple is used to switching between suppliers fairly often for a tech company; it's not that it's too hard for them to switch fab, it's that TSMC is the only competitive fab right now.

There are rumours that Intel might have won some business from them in 2 years. I could totally see Apple turning to Intel for the Mac chips, since they're much lower volume. I know it sounds crazy, we just got rid of Intel, but I'm talking using Intel as a fab, not going back to x86. Those are done.

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lukan 3 hours ago | parent | next [-]

But wasn't the reason they split with Samsung because they copied the iphone in the perspective of Jobs (to which he reacted with thermonuclear threats)?

They did had the expertise building it after all. What would happen, if TSMC now would build a M1 clone? I doubt this is a way anyone wants to go, but it seems a implied threat to me that is calculated in.

	▲	thewebguyd 3 hours ago \| parent \| next [-]
		Job's thermonuclear threats were about Android & Google, not Samsung because Schmidt was on Apple's board during the development of Android. > "I will spend my last dying breath if I need to, and I will spend every penny of Apple’s $40 billion in the bank, to right this wrong. I’m going to destroy Android, because it’s a stolen product. I’m willing to go thermonuclear war on this." The falling out with Samsung was related, but more about the physical look of the phone
	▲	fragmede 2 hours ago \| parent \| prev [-]
		Doesn't seem likely, TBH. Nevermind the legal agreements they would be violating, TSMC fabs Qualcomm's Snapdragon line of ARM processors. The M1 is good, but not that good (it's a couple generations old by this point, for one). Samsung had a phone line of their own to put it in as well. TSMC does not.

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chippiewill an hour ago | parent | prev [-]

I thought Intel was too far behind on their process nodes?

	▲	wtallis an hour ago \| parent [-]
		At the end of the month, laptops with Intel's latest processors will start shipping. These use Intel's 18A process for the CPU chiplet. That makes Intel the first fab to ship a process using backside power delivery. There's no third party testing yet to verify if Intel is still far behind TSMC when power, performance and die size are all considered, but Intel is definitely making progress, and their execs have been promising more for the future, such as their 14A process.

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CodeWriter23 4 hours ago | parent | prev | next [-]

Apple is the company that just over 10 years ago made a strategic move to remove Intel from their supply chain by purchasing a semiconductor firm and licensing ARM. Managing 'painful' transitions is a core competency of theirs.

	▲	Zafira 3 hours ago \| parent \| next [-]
		I think you’re correct that they’re good at just ripping the band-aid off, but the details seem off. AFAIK, Apple has always had a license with ARM and a very unique one since they were one of the initial investors when it was spun out from Acorn. In fact, my understanding is that Apple is the one that insisted they call themselves Advanced RISC Machines Ltd. because they did not want Acorn (a competitor) in the name of a company they were investing in.
	▲	wtallis 4 hours ago \| parent \| prev [-]
		Which acquisition are you referring to? Apple bought PA Semi in 2008 and Intrinsity in 2010.

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MBCook 2 hours ago | parent | prev | next [-]

Not all of Apple‘s chips need to be fabbed at the smallest size, those could certainly go elsewhere. I’m sure they already do.

Is there anyone who can match TSMC at this point for the top of the line M or A chips? Even if Intel was ready and Apple wanted to would they be able to supply even 10% of what Apple needs for the yearly iPhone supply?

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7speter 3 hours ago | parent | prev | next [-]

I would imagine they could split their orders between different fabricators; they can put in orders for the most cutting edge chips for the latest Macs and iPhones at TSMC and go elsewhere for less cutting edge chips?

	▲	fsckboy 3 hours ago \| parent [-]
		presumably they already do that (since non cutting edge chip fab is likely to be more competitive and less expensive) so, given they are already doing that, this problem refers to the cutting edge allocations which are getting scare as exemplified at least by Nvidia's growth

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jongjong 2 hours ago | parent | prev [-]

It's ridiculous that a trillion dollar company feels beholden to a supplier. With that kind of money, it should be trivial to switch. People forget Nvidia didn't even exist 35 years ago. It would probably take like 3 to 5 years to catch up with the benefit of hindsight and existing talent and tools?

And anyway consumers don't really need beefy devices nowadays. Running local LLM on a smartphone is a terrible idea due to battery life and no graphics card; AI is going to be running on servers for quite some time if not forever.

It's almost as if there is a constant war to suppress engineer wages... That's the only variable being affected here which could benefit from increased competition.

If tech sector is so anti-competitive, the government should just seize it and nationalize it. It's not capitalism when these megacorps put all this superficial pressure but end up making deals all the time. We need more competition, no deals! If they don't have competition, might as well have communism.

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weslleyskah 2 hours ago | parent | next [-]

I know you are maybe joking but I don't think the government nationalizing the tech sector would be a good idea. They can pull down the salaries even more if they want. It can become a dead end job with you stuck on archaic technology from older systems.

Government jobs should only be an option if there are enough social benefits.

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jongjong 2 hours ago | parent [-]

I'm joking yes but as an engineer who has seen the bureaucracy in most big tech companies, the joke is getting less funny over time.

I've met many software engineers who call themselves communists. I can kind of understand. This kind of communist-like bureaucracy doesn't work well in a capitalist environment.

It's painful to work in tech. It's like our hands are tied and are forced to do things in a way we know is inefficient. Companies use 'security' as an excuse to restrict options (tools and platforms), treat engineers as replaceable cogs as an alternative to trusting them to do their job properly... And the companies harvest what they sow. They get reliable cogs, well versed in compliance and groupthink and also coincidentally full-blown communists; they're the only engineers remaining who actually enjoy the insane bureaucracy and the social climbing opportunities it represents given the lack of talent.

	▲	weslleyskah an hour ago \| parent [-]
		I understand completely. I'm going through a computer engineering degree at the moment, but I am thinking about pursuing Law later on. Looking at other paths: Medicine requires expensive schooling and isn't really an option after a certain age and law, on the other hand, opened its doors too widely and now has a large underclass of people with third-tier law degrees. Perhaps you can try to accept the realities of the system while trying to live the best life that you can? Psyching yourself all the way, trying to find some sort of escape towards a good life with freedom later on...

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cgio 2 hours ago | parent | prev [-]

It can be interpreted a different way too. Apple is just a channel for TSMCs technology. Also the cost to build a fab that advanced, in say a 3 year horizon, let alone immediately available, is not one even Apple can commit to without cannibalising its core business.