“Apple Inc. and worldwide demand for its iPhone and iPad — and maybe soon iTV — may be behind top-secret efforts to land a second major semiconductor manufacturing facility in the Capital Region,” Larry Rulison reports for The Albany Times Union.

“Since the fall, consultants representing a major high-tech manufacturer have been pitching New York economic development officials a plan for a 3.2 million-square-foot production facility that would likely cost as much as $10 billion to build. Sites under consideration include Luther Forest Technology Campus in Malta, which is already home to a $4.6 billion computer chip factory, and a site in Oneida County next to SUNY IT,” Rulison reports. “Although the plans — dubbed Project Azalea — became public last month, the exact identity of the company that wants to build the factory has never been revealed.”

Rulison reports, “Increasingly, though, it appears that whoever is behind Project Azalea wants to build the mega factory to satisfy Apple, which had $156 billion in sales during the past year and is considered the world’s most valuable company. And, based on analyses by industry experts, the most likely scenario involves one of the companies that supplies computer chips to Apple for its iPhone and iPad devices and Macintosh computers — or a company vying to win Apple’s business.”

Apple's A6X custom system-on-a-chip (SoC) processor

Apple’s A6X custom system-on-a-chip (SoC) processor

 
“Tech media outlets have been reporting that Taiwan Semiconductor Manufacturing Co. has been angling for the business that Samsung has with Apple,” Rulison reports. “TSMC does face one major hurdle, but the issue is the reason that many believe that TSMC could be looking to build a new U.S. plant, possibly in New York, which provided a $1.4 billion incentive package to GlobalFoundries. TSMC cannot supply as many chips as Apple would need at its existing factories, and Apple, of course, increasingly appears to want more of its products, or parts of its products, made in the U.S.”

Read more in the full article here.

In another article, Rulison reports, “Over the summer TSMC’s chief executive officer Morris Chang told analysts that the industry has changed so much that there are other ways to solve the problem. ‘Now it makes complete sense to dedicate a whole fab to just one customer,’ Chang said. ‘There are customers that are getting bigger and bigger. So it makes sense that we dedicate a whole fab or even more than a whole fab to just one customer.'”

“Such a scenario would be extremely risky for a company like TSMC, considering that the price tag for a fab the size of the one being considered for Luther Forest is upwards to $10 billion,” Rulison reports. “The fab operated by GlobalFoundries at Luther Forest, which is smaller than that at 2 million square feet, will have a final cost of $7 billion once an expansion is completed. But Apple, which is sitting on $121 billion in cash, has that type of money, and there have been news reports that Apple has shown a willingness to invest in its suppliers as a way to enhance their stability.”

Read more in the full article here.

[Thanks to MacDailyNews Reader “Reference Desk” for the heads up.]