Time and time again it has been reported that Apple wants to diversify its supply chain and reduce its reliance on Samsung. The Korean juggernaut, which happens to be its biggest rival in the global market, provides displays and processors to Apple. Cupertino was reportedly leaning on Taiwan Semiconductor Manufacturing Co. or TSMC to start providing it with processors. A new report today claims that TSMC has now begun shipping “A” series processors, found in the company’s mobile devices, to Apple.
Citing people familiar with the matter the Wall Street Journal reports that the first batch of processors from TSMC was shipped in the second quarter. Another source claimed that both Apple and TSMC have agreed to work on more advanced mobile chips starting next year.
Its not like we didn’t see this coming. Apple formally contracted TSMC to start building chips for it last year, however 2013’s cache of mobile devices still carried Samsung-made processors because apparently TSMC wasn’t able to make chips fast enough. The manufacturer is now believed to have made improvements to its manufacturing process, allowing it to keep up with Apple’s demand and meet its strict requirements.
Apple now doesn’t solely have to rely upon Samsung for processors and by having another supplier onboard the company will have leverage in price negotiations with other suppliers in the future.
For TSMC the obvious advantage is that of having Apple as a customer and the company’s large orders are expected to account for 10 percent of TSMC entire yearly revenue in 2014.