Katie Marsal
Samsung may put off construction of a new fabrication facility, according to a new rumor, because it is expected to lose some future chip orders from Apple.
Hit-or-miss technology industry publication DigiTimes, which is known for having a spotty track record with respect to anonymous sources, reported this week that Samsung Electronics is "likely" to delay construction of a new logic fabrication facility known as Line-17. The primary concern for Samsung is said to be the "possibility of losing a portion of orders for Apple's next-generation application chips."
Samsung plans to build the new semiconductor plant in Hwaseong, a city in the Gyeonggi Province of South Korea. Volume production has been planned to begin in the first quarter of 2014.
"However, Samsung will no longer be the sole supplier of Apple-designed chips that power the iPhone and iPad devices, the sources indicated," the report states. "The anticipated drop in orders from Apple has prompted Samsung to consider slowing the pace of its logic-IC capacity expansion."
Apple has long rumored to be pursuing a chipmaking partnership with Taiwan Semiconductor Manufacturing Co., though Samsung remains the sole supplier of Apple's custom chips found in the iPhone and iPad. One report from last month claimed that TSMC could begin building quad-core 20-nanometer chips for Apple as soon as late 2013.
And in October it was said that Apple was getting "serious" about moving chip production away from Samsung. Around the same time, Apple also hired away former Samsung chip designer Jim Mergard, who also designed and developed chips for AMD for 16 years.
The growing reports could represent a concern on the part of Samsung that its chipmaking business will not grow as much as expected, with the potential loss of Apple as a major customer.
Apple was rumored earlier this year to have made an offer for around $1 billion that would have made TSMC a dedicated chip producer to Apple alone. The offer was allegedly rejected by TSMC, as the company was said to be interested in staying involved in the booming broader smartphone market.
William Gallagher
Christine McKee
AppleInsider Staff
Chip Loder
Malcolm Owen
44 Comments
"The growing reports could represent a concern on the part of Samsung that its chipmaking business will not grow as much as expected, with the potential loss of Apple as a major customer." But I thought their SG3 and Note and what not was doing extremely well, especially international markets that want cheap crap like the continent of Africa and Latin America? Why not use that "proposed" fabrication plant to build chips for their own items since they are so successful? / /
If Apple intends to switch away from Samsung for logic fabrication, it's obviously to their benefit to keep Samsung in the dark as long as possible. However, if Apple's only exploring the possibility of moving away from Samsung and haven't actually committed to do so, keeping Samsung in the dark may actually hurt Apple. Chip fabs can take years to plan and build and if Apple's mixed messages keeps Samsung from investing in new fabs, if Apple turns out to still be with Samsung in two years after-all, they may find themselves short on production capacity. It'll be interesting to see how Apple tries to diversify while keeping Samsung viable as a primary producer.
Re: "...TSMC could begin building quad-core 20-nanometer chips for Apple as soon as late 2013." The most interesting part of this rumor is the adjective "quad-core." It's quite possible that the 2014 iPhone and iPad will get that quad-core AX chip, most likely still based on the ARMv7 32-bit reference. But the 64-bit ARMv8 instruction set was released a year ago, and ARM announced their 64-bit Cortex-A53 and Cortex-A57 cores last month. It's only a matter of time before Apple switches consumer Macs to quad-core 64-bit ARM-based AX chips. Yes, there are marketing and legacy software issues to overcome. But the cost benefit to Apple is so huge that Apple needs to make the Intel-to-ARM transition on their consumer-grade Macs. Intel's CPU pricing is astronomical, and eliminating the Intel Tax would allow Apple to lower Mac prices (helping build market share) while maintaining their high margins.
[quote name="ltcommander.data" url="/t/154132/rumor-samsung-expecting-to-lose-a-portion-of-orders-for-future-apple-chips#post_2228834"]If Apple intends to switch away from Samsung for logic fabrication, it's obviously to their benefit to keep Samsung in the dark as long as possible. However, if Apple's only exploring the possibility of moving away from Samsung and haven't actually committed to do so, keeping Samsung in the dark may actually hurt Apple. Chip fabs can take years to plan and build and if Apple's mixed messages keeps Samsung from investing in new fabs, if Apple turns out to still be with Samsung in two years after-all, they may find themselves short on production capacity. It'll be interesting to see how Apple tries to diversify while keeping Samsung viable as a primary producer.[/quote] I'm sure the Samsung board will be saying the same thing to themselves. We can mock them, antagonise them, copy their products. They are just bluffing. Apple NEED US !
"The growing reports could represent a concern on the part of Samsung that its chipmaking business will not grow as much as expected, with the potential loss of Apple as a major customer."
But I thought their SG3 and Note and what not was doing extremely well, especially international markets that want cheap crap like the continent of Africa and Latin America? Why not use that "proposed" fabrication plant to build chips for their own items since they are so successful?
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Actually they are. If you haven't yet heard, Samsung Electronic's profit is up almost 100% yoy, in large part, thx to GS III.
LOL! You are confused. Samsung's largest markets are Europe and Asia, then followed by the American continents. Nokia's main customers basis is in Africa & Latin America.
".. Hit-or-miss technology industry publication DigiTimes, which is known for having a spotty track record with respect to anonymous sources,.. "
LOL!!