Did TSMC just clinch an exclusive deal with Apple over iPhone 7 processor?

By Staff Writer

Feb 12, 2016 07:16 AM EST

Reports say that Apple has abandoned its long-time partner Samsung, and will now solely depend on Taiwan Semiconductor Manufacturing Company to make the new "A10" chip for iPhone 7 that is scheduled to hit the shops in September.

As AppleInsider indicates, the rumor might just be true as the Taiwanese chip manufacturer's advanced integrated fan-out (InFo) is far superior to Samsung's capabilities. This technology "stacks embedded chips on top of each for direct mounting on a circuit board, reducing thickness and weight". TSMC is supposedly losing no time and plans to roll out production by June.

Before this, both Samsung and TSMC were the official manufacturers of processors or System on Chip (SoC) for iPhone, the iPad, and Apple TV. While it had a long association with Samsung, it was always inclined towards other players like TSMC, as per International Business Times. The Taiwanese chip maker had the exclusive deal of manufacturing the A8 SoC for the latest Apple products like iPhone 6, the iPhone 6 Plus, and Apple TV.

Before this, the A8X and the A9X used in the Apple iPad Air 2 and the iPad Pro were also made by the player. So TSMC clinching the deal for the latest Apple phone model seems like a natural progression for the technology giant.

It is indeed a blow for Samsung, as they were eyeing to win the deal for themselves, in the face of growing demand for semiconductors globally and gloomy 2016 forecast. However, according to Android Authority, the news did not come as a shock to the Korean conglomerate as the company seems to have predicted the course of action in the latter half of 2015, which explains their aggressive strategies to win Qualcomm's Snapdragon 820 contract.

TSMC, on the other hand, too has old ties with Qualcomm, along with Advanced Micro Devices, MediaTek and Broadcom, for whom they would produce SoC and processors. With 20% of its revenues coming from Apple, TSMC is now the leading third-party contract chip manufacturer in the world.

With each model, Apple is seen to take chip performance to the next level. For its much-awaited new release, the A10 promises to be much faster than the preceding A8 or A9, which, despite being smaller in size, will not affect the phone's battery life and speed.

TSMC chose to remain silent on these speculations. But its 2014 books of accounts indicate the company is focused on 10nm technology and is now awaiting the final signal from Apple before turning the wheels of production.  

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