“It’s being reported in Korea today that Taiwan’s TSMC has won the battle against Samsung Electronics and will produce the iPhone 7’s 10-nano application processors,” Jack Purcer reports for Patently Apple. “The news comes by way of semiconductor IP and EDA industries. These sources confirm that Apple has entrusted TSMC with all production of next 10-nano AP called ‘A10.’ TSMC is planning to enter a state of mass-production starting from June.”
“A high-ranking executive in EDA industry stated that “TSMC has taken all of Apple’s supplies in 10-nano and such plans were already confirmed in second half of last year,” which explains why HSBC was so confident in their forecast [late last year],” Purcher reports. “Now, Samsung Electronics has entered a state of emergency system to prevent declination of rate of operation of factories, claims the report.”
Purcher reports, “The report further noted that ‘It is also important for Samsung Electronics to plan out high-intensity innovations so that it can take back Apple’s supplies in 7-nano. But for now, it’s all bad news for Samsung and it’s going to be hard to be profitable in 2016 without Apple’s orders for the A10.'”
Read more in the full article here.
MacDailyNews Take: Gee, that’s too bad.
SEE ALSO:
TSMC to be sole manufacturer of Apple A10 processor dealing blow to beleaguered Samsung – February 10, 2016
TSMC’s Apple A10 exclusivity damages beleaguered Samsung in myriad ways – December 10, 2015
Samsung stole trade secrets from TSMC to win Apple A9 stamping deal – August 26, 2015
Apple makes ‘last-minute decision’ to use TSMC to stamp out 30% of next-gen ‘A9’ chips – April 15, 2015
TSMC sues former ex-employee over leaking trade secrets to Samsung – February 9, 2015
TSMC says to invest additional $16 billion in advanced chip factory – February 6, 2015Beleaguered Samsung names new cellphone head in bid to stem market share losses to Apple iPhone – December 1, 2015
Ben Bajarin: ‘Samsung will be out of the smartphone business within five years’ – November 2, 2015
Apple’s iPhone can soon reap 100 percent of world’s smartphone profits – November 17, 2015
Apple’s iPhone owns 94% of smartphone industry’s profits – November 16, 2015
Study: iPhone users are smarter and richer than those who settle for Android phones – January 22, 2015
Why Android users can’t have the nicest things – January 5, 2015
iPhone users earn significantly more than those who settle for Android phones – October 8, 2014
Yet more proof that Android is for poor people – June 27, 2014
More proof that Android is for poor people – May 13, 2014
Android users poorer, shorter, unhealthier, less educated, far less charitable than Apple iPhone users – November 13, 2013
IDC data shows two thirds of Android’s 81% smartphone share are cheap junk phones – November 13, 2013
CIRP: Apple iPhone users are younger, richer, and better educated than those who settle for Samsung knockoff phones – August 19, 2013
wzup steve
Sammeeeee scum, surely you knew this day would come didn’t you?
Flush
Samsung is getting what it deserves.
But iv been saying for so long..
The real charlatan was not samsung…
It is
Google…and Eric Mole Schidth ….
When is Karma going to do it part on them lowlives ?
And how will it manifest itself ?
For the millionth time ‘karma’ is a Hindu belief where action in past lives affects this life, and so on.
It is NOT Samsung losing an order of semiconductors having ripped off Apple’s IP.
*That is not karma.*
Also, if you believe in karma you’ll have to believe in the caste system and reincarnation, etc..
You’re complaint about the use of Karma is completely off base.
Here’s one of the definitions given by Meriam-Webster:
“The force created by a person’s actions that some people believe causes good or bad things to happen to that person”
This meaning is no doubt intended in the great majority of American usage.
I meant YOUR complaint
You’re confusing its etymology with the word’s current common meaning. Many cultures have a word or phrase for this “just desserts” thing. The American English one happens to borrow from the Hindu.
For the millionth time, shut up and keep on topic.
I don’t think he can do both. This would likely be an either or proposition. Unless saying nothing captures everything he has to say on the topic 🙂
awesome. 🙂
You have a very narrow view of definitions and choice.. Kind of dogmatic view of things.
Plus….One can pick and choose what they believe … Cant they? ….Is not a dogmatic world of all or nothing for a lot of minds out there.
Petelp give you a good answer!
It will manifest itself when Apple takes off Google search on all its product lines.
That would cost google 100s billions in lost search revenue.
I for 1 will crack open the champagne when it happens :))))
Thanks to Eric, Google’s culture is founded on bluff and dishonesty which puts them on a life-changing collision course with harsh reality. They’ll self-annihilate soon enough without any need for help from the outside.
Negotiating tactic. We’ve heard this before. But when it comes down to it, TSMC alone can’t produce the volume Apple needs, and eventually Apple announces that Samsung will also be filling orders for their processor.
You’ve already said that and were answered yesterday.
If by “answered” you mean shouted down by folks who can’t remember that the same thing about TSMC exclusivity was said last year, and the year before, and the year before that, then yes, you’re right. I was “answered”. But the fact remains, we’ve heard this before, and in the end, Samsung always ends up supplying chips too, because TSMC can’t do the volume Apple needs all by itself.
I’m sure when Apple announces that Samsung will also be filling orders for the new A-series processor, as they always eventually do, you’ll own up to your mistake, right? Right??
“That” was not a report it was a rumor.
TSMC themselves said, in their most recent quarterly report, that they won’t be at full production of 10nm chips until 2017.
Just as long as this doesn’t bite Apple in the backside later, all luck to them. 🙂
If the news turns out to be entirely true and not later modified to include some shared production (which has happened before), then this is exceptionally great news indeed. Samescum’s own phones and profitability benefited a good deal because their factories overhead and investment cost was shared across the Apple product line, it wasn’t just because of the direct profit earned by their Apple sales. Without the volumes, the average cost of what remains of Samescum production will also rise…and their difficulty increases for future investments without such profitability to sustain it.
They face a situation where they would need to double down and “bet the farm” financially to win back the lost Apple business, or risk forever being behind the curve and unable to catch up. Good for you Apple and may your relationship with TSMC be less fraught than the one you’ve had with Samsung.
Knowing that Apple tends to get good prices with the volume they require this may not be as bad for Samsung as you may think. Since this frees up foundries for production of chips to smaller firms not able to get the pricing Apple would get, Samsung has to sign up say 80% of the production they lost to make the same money. If they are somehow able to maximize foundry use they’ll profit even more.
Yes, all Samsung needs to do is to find themselves a new client who needs 80% as many chips as Apple did.
Any suggestions?
Who said anything about a single client? Multiple clients will allow less chance for deep discounts and preserve profit margins. As for clients, perhaps some Chinese Android handset OEMs or take some market from other semiconductor makers.. CPUs aren’t the only market for foundries..
Multiple clients requires multiple dies requires multiple settings for the machinery multiple people training for the different semi conductors and multiple people changing out dies all the way through the production line when assembling them. This also means a lot more downtime on setting up the machinery the people the placement for everything and is a lot less cost-effective than a single run
I agree that the overhead does increase, however there is probably a nice medium range where they would be doing better than having to deal with the deep discounts Apple had negotiated with them.
If this was so easy, they would have done it already.
Never said it was easy.
Sure, sure. That’s why Samsung decided to abandon Apple as a client to follow your alternative strategy
MDN does not show my sarcasm tag at the end of the sentence… In case you are wondering.
It was probably easier (logistically, accounting and overhead) to deal with a single large client than a few smaller ones. Prestige could have played part too. *shrug*
You are living in fantasy land to think this isn’t going to hit Samsung hard and deep, assuming that the report is true and Samsung does not get part of the order along with TSMC.
I wouldn’t be surprised if Samsung wasn’t hit as hard by this as everyone seems to think. Being contracted by Apple may have simply took up such a large block of production that medium order contracts were not easily possible. And should Apple later decide to have Samsung manufacture a smaller batch of CPUs, they surely won’t be at as deeply discounted.
High intensity stealing! Haha that’s what the plan is. 😛
Probably no one is better at playing off multiple suppliers than Apple. Samsung gives up to TSMC, but immediately, TSMC knows they can’t keep the business unless they stay on the cutting edge.
So no one knows who will make the A11.
TSMC are only where they are because of Apple’s investment and support. Apple knows that prior to their investment in TSMC, there wasn’t another foundry on the planet who could act as a suitable alternative to Samsung.
Apple and TSMC are mutually dependent. Apple won’t want to screw over TSMC because they need the company to be successful for the future. TSMC won’t want to screw over Apple because they saw what happened ( and benefited ) when Samsung acted dishonourably towards Apple.
Apple will not only help TSMC stay on the cutting edge, but will also ensure that the cutting edge is optimised for Apple’s precise needs.
1) i thought all the analysts, press were saying the iPhone and Apple was in decline, yet when Apple pulls its business even from supergiant corps like Samsung it pushes them into ‘a state of emergency’
2) I’ve criticized Tim Cook before (mostly his handling of PR, Mac ) but I must say he is MASTER of the ‘ANACONDA STRATEGY’. He’s quiet but wins by slow strangulation, T.C opens retail outlets, builds relationship with politicians (like those prickly guys in China and India), gets more contractors and buys strategic companies like those chip design, fingerprint firms — slowly choking the life out of competitors.
He’s like the nerd that wins in the end — because after school the nerd is driving the Porshe while the jock is serving fries at the Mickey D’s.
yes and hopefully
Tim ‘the Big Snake’ Cook will eat the damn MOLE.
Apple would be wise to keep feeding Samsung chip work and stay healthy because it’s bad news if TSMC becomes a lone behemoth without decent competition. That’s a far worse scenario for Apple.
I agree with part of what you’re saying, but strongly disagree with your reason.
TSMC will take it’s cue from Apple and will not need rivals to compete with, just as Apple doesn’t need rivals in order to make the best desktops, laptops, tablets or smartphones. If you have the right mindset, the quest for perfection is all the inspiration you need.
However, much as I despise Samsung, Apple should still keep them on board but to a lesser extent than at the moment. Taiwan is an island that is very prone to earthquakes. There have been about 20 earthquakes in the last twenty years. Since 1900 there have been three earthquakes that each killed more than a thousand people.
I don’t know how whether the TSMC factory is in an area likely to be free from earthquakes or if the factory is likely to survive one, but it seems to me that Apple are putting all their eggs in one basket, which happens to be in an earthquake zone.
I think it would be prudent to maintain multiple sources for all key components.
Competition is great for the consumer and industry. Once that’s gone, things go terribly wrong. A monopolist will always take advantage of the situation, corruption ensues and a retardation of innovation settles in and suffocates an industry. It is basic human behavior
Y’all seem to forget that Samsung isn’t the only company out there producing high end flagship phones running Android.
10 micron! ten micron? ten mofo mi-fn-cron! Danger! how fang dumb is this report! Arrrrrgh!
Thermonuclear.
I guess even Tim Cook figured out that Scamsung was a disloyal bitch unworthy of anything.
He didn’t “figure it out” all of a sudden like you’re strongly implying. You can’t just cut out your primary maker of your own custom chips before a suitable replacement is running, making sufficient quantities that pass your stringent QA tests.
Samsung has big stores in poor countries. They have huge market share. They are a global brand. What could possibly go wrong? Google, you’re next. Revenge is a dish best served cold.
The wonders of competition. If Samsung can pull some actual innovation out of a pleasant orifice, good on them. But for now, What A Joy to see ScamScum being soooo delightfully screwed! 😸👏👏👏
Is it just me, or does MDN overuse the word “beleaguered”? How about something like “Samsung Under Siege?” or “Samsung Under Attack”?