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Apple and Samsung could potentially become the only smartphone vendors and chip designers to adopt 7-nanometer processors for 2018 phones, owing to the costs involved, a report noted on Wednesday.
The slowdown of smartphone industry growth is pushing down chip prices, in turn forcing chip suppliers to "seriously weigh in" on the cost of new chipsets, DigiTimes sources said. Higher wafer foundry costs might eat into declining profit margins.
Sources estimate that a chipset manufacturer may need to ship as many as 120 million to 150 million 7-nanometer chips just to break even on development. As the world's biggest smartphone vendors, Apple and Samsung could be the only ones ordering on that scale — even Chinese giant Huawei is allegedly having trouble catching up in processor size because of cost issues.
Qualcomm and MediaTek could also be in a position to order 7-nanometer chips, but those companies simply develop processors rather than make complete devices. DigiTimes added that Qualcomm is sticking to Samsung's 10-nanometer process for its Snapdragon 845 processor, while MediaTek is hanging on to TSMC's 12- and 16-nanometer nodes.
Apple is typically quick to adopt more efficient chips, looking to simultaneously shrink devices and improve power efficiency even as it adds new features. The A11 Bionic processor in the iPhone 8 and X uses TSMC's 10-nanometer process, and multiple reports have pointed to a 7-nanometer "A12" appearing in next year's iPhones. Those models may include 5.8- and 6.5-inch OLED devices and a 6.1-inch LCD product.