TSMC May Win Bulk of A9 Orders Due to Better Production Yield

News reports and rumors have gone back and forth multiple times over whether Samsung or the Taiwan Semiconductor Manufacturing Company (TSMC) will produce the A9 chips designed for use in next-generation iOS devices as the two companies compete for Apple's business.

In December, a report suggested Samsung had already begun production on the A9 chips, but a new analyst prediction shared by the Taipei Times suggests that TSMC, not Samsung, may be Apple's main A9 chip supplier due to its more favorable production yield.

tsmc_samsung_logo

"The two companies' technological capabilities are similar, so the key factor will be whose mass-production yield is better," MIC director Chris Hung (洪春暉) told reporters on the sidelines of the event. Hung added that the chances of TSMC remaining the main supplier are higher because of its better yields.

While one company will win the right to produce the bulk of Apple's next-generation chips, Apple may spread orders of the A9 processor across multiple suppliers in order to cut down on risk. The best yield results in the lowest price for Apple, so the company that manages to produce the most usable chips from a single wafer (a semiconductor material) will likely win the bulk of orders from Apple.

The continually shifting Samsung vs. TSMC rumors reflect the ongoing competition between the two chip manufacturing companies and demonstrate just how important Apple contracts are to suppliers. As we saw with GT Advanced and its failed sapphire deal with the Cupertino company, manufacturers will go to great lengths to secure lucrative partnerships with Apple.

In 2013, Apple signed a multi-year deal with TSMC to produce A-series processors for Apple devices as the company made an effort to move away from Samsung, but while TSMC produced the bulk of Apple's A8 and A8X chips for the iPhone 6 and the iPad Air 2, Apple has not been able to entirely cut ties with Samsung due to its chip production expertise and reliability.

As chip technology advances, it becomes more and more difficult for companies like Samsung, TSMC, Intel, and others to pack transistors onto an ever-decreasing surface area, which is why Apple has likely made moves to diversify its supply chain lineup in recent years. More suppliers gives the company a backup solution should one run into production difficulties that could result in potential delays.

Top Rated Comments

Aluminum213 Avatar
79 months ago

Sounds like a good strategy to me. It also likely gets them to compete on price as well.


Don't worry, the savings won't be passed upon to you
Score: 11 Votes (Like | Disagree)
Keniutek Avatar
79 months ago
I would rather see Samsung as the main supplier. We all say "bad things" about the Korean company, bla bla bla...
and then pray to get their screen or hd. LOL
Score: 8 Votes (Like | Disagree)
Noble Actual Avatar
79 months ago
Hope this isn't true.

TSMC has had a BAD history of delivering.

Wasn't A8 suppose to be bulk TSMC? They failed and Samsung had to take over.

Apple has wanted to stop using Samsung to make its parts but the truth is...they make the BETTER parts

Samsung > TSMC over chips.
Samsung > LG over displays.
Score: 7 Votes (Like | Disagree)
mschmalenbach Avatar
79 months ago

I don't think I follow... Why would these companies need different tape-outs and if that is the case, why couldn't Apple supply multiple tape-outs for the manufactures? Could you explain a little?


Different tape-outs will likely be needed for several reasons, even though Apple might be using 14nm (for example) processes from both TSMC and Samsung. "Why?", you might ask...

Samsung and TSMC are unlikely to have identical processes, even if they do use the same equipment in their fabs. Why different processes? Because they were developed differently - unless they licensed the process in its entirety from a 3rd party...

Manufacturing a complex semiconductor involves a lot of steps, some of which require the use of pretty nasty chemicals to etch away other chemicals, thus forming various patterns and structures on the silicon wafer on to which metals like aluminum or copper are deposited (to form signal pathways) or to which dopants are added to form the N type and P type junctions that make up transistors.

The complex computer aided design systems used by Apple and other designers need to know about the characteristics of the target manufacturing process in order to make sure that dopant areas are big enough to enable the transistors to work as intended, that signal pathways aren't too close together that they might short out in manufacturing, or become too narrow and so perhaps affect system timings in a variety of subtle ways. Remember there are upwards of 1-2 BILLION transistors on each of these devices... they pretty much ALL need to work as expected...

So different manufacturing processes equates to different design rules - if you are going to manufacture on 2 different processes, even if they are very similar, you are going to need to simulate your system against each set of design rules, and do your chip layout according to the different process/engineering/layout rules of each - and layout and simulation represent the majority of design time... So you don't go for 2 suppliers with these complex parts for the hell of it - it's a critical decision to make... requires a lot of engineering resources...

But if you're going to be selling 40-80 million devices a quarter, and it's core to your business reputation and model, then you'd be almost negligent to put all your 'eggs in one basket', so to speak... or at least, all in one fab, even if it's only with one supplier...

Creating the mask sets needed for TSMC and Samsung (because they won't be the same) for the 10-14nm process node is likely to cost $10s MILLION per set, and my $10s MILLION we're talking closer to $80M than $30M! If not more...

In summary, it's very unlikely that 2 fab processes developed by 2 different companies, even if they worked together closely, will be sufficiently similar for only 1 tape out to be needed AND still get the maximum density and performance out of the manufactured chips...

... and the cost of each tape out and mask set for each supplier at these process nodes/geometries is VERY HIGH!! So you'd think twice, and then twice again, before going down the road of multiple supplier...

UNLESS it's so critical to your business that you can't afford the risk of poor yields / capacity & supply constraints from your supply chain.

For the procurement/supply chain side of this topic, investigate the financial risk vs supply chain risk 'grid' put forward by Kraljic (it's the basis of supply chain management studies these days, I believe). Google 'kraljic purchasing model'.

----------

Not worth it? Well over 100M chips at near $40 a pop makes 20% a roughly $1B business. There are companies that spend as much on tape-outs for lesser business opportunities.


Tape-outs & mask sets at the 10-14nm process nodes can cost 'in the region of $100M'...

So development by trial and error is out! Hence a LOT of simulation work... and that TAKES TIME and some serious computing power!

Also, just because we're talking Apple, TSMC & Samsung here - about the biggest buyer/suppliers of chips on the planet, doesn't mean that any of them will 'play nice and easy' when it comes to apportioning risk!
Score: 6 Votes (Like | Disagree)
Morris Avatar
79 months ago
All these analysts claiming the production run is split between two companies… I have yet to see the first person with actual chip production experience state that it’s even possible.

So far I only see experts claiming that it’s technically almost impossible to split advanced production runs because different companies have different requirements. You can’t send the same tape-out to both companies because tape-outs for TSMC wouldn’t be compatible with Samsung’s equipment and vice-versa.

Instead of printing speculation from “analysts” could MacRumors instead try to speak to a subject expert to get real insight? You know, someone who actually knows a thing or two about chip design and production?
Score: 6 Votes (Like | Disagree)
chrmjenkins Avatar
79 months ago
The last official reports had TSMC's FinFET schedule well behind Samsung. I doubt much has drastically changed in the last few months.

Their processes are also not compatible, so it's not simply flipping a switch to decide between the two.
Score: 5 Votes (Like | Disagree)

Top Stories

bloodoxygenapplewatch

Apple Watch Series 7 Rumored to Feature Blood Glucose Monitoring

Monday January 25, 2021 5:05 am PST by
The Apple Watch Series 7 will reportedly feature blood glucose monitoring via an optical sensor, according to ETNews. The report, which mainly focuses on the blood glucose capabilities of the Samsung Galaxy Watch 4, explains that Apple is intending to bring blood glucose monitoring to the upcoming Apple Watch Series 7 using a non-invasive optical sensor. Measuring blood glucose levels,...
magsafecasedangle

Apple Elaborates on Potential for iPhone 12 and MagSafe Accessories to Interfere With Implantable Medical Devices

Saturday January 23, 2021 2:42 pm PST by
Since the launch of iPhone 12 models in October, Apple has acknowledged that the devices may cause electromagnetic interference with medical devices like pacemakers and defibrillators, but the company has now shared additional information. Apple added the following paragraph to a related support document today:Medical devices such as implanted pacemakers and defibrillators might contain...
14

Apple Releases iOS 14.4 and iPadOS 14.4 With New Camera Warnings and Bug Fixes

Tuesday January 26, 2021 10:04 am PST by
Apple today released iOS and iPadOS 14.4, the fourth major updates to the iOS 14 operating system that was initially released in September. iOS and iPadOS 14.4 come more than a month after the release of iOS and iPadOS 14.3, updates that brought new emojis, Intercom support, and more. The iOS and iPadOS 14.4 updates can be downloaded for free and the software is available on all eligible...
Top Stories 44 Feature

Top Stories: 'Thinner and Lighter' MacBook Air, Smaller iPhone 13 Notch, iOS 14.4 Incoming

Saturday January 23, 2021 6:00 am PST by
We continued to hear a lot more about Apple's plans for its Mac lineup this week, including word of a high-end redesigned MacBook Air and the return of an SD card slot as part of the upcoming MacBook Pro redesign. It also sounds like Apple has been working on Face ID for Mac, but it won't be appearing in a redesigned iMac this year as originally planned. This week also saw rumors about the...
14

Apple Releasing iOS 14.4 and watchOS 7.3 Later Today

Tuesday January 26, 2021 7:20 am PST by
In its Black History Month announcement this morning, Apple has confirmed that iOS 14.4 and watchOS 7.3 will be released later today. watchOS 7.3 expands the ECG app on the Apple Watch Series 4 and newer to Japan, Mayotte, Thailand, and the Philippines, while iOS 14.4 introduces a notification on iPhone 12 models with non-genuine cameras. Both software updates also add support for a new...
maxresdefault

Microsoft Touts Surface Pro 7 as 'The Better Choice' Over MacBook Pro in New Ad

Saturday January 23, 2021 11:02 am PST by
Microsoft yesterday shared a new ad on YouTube titled "Microsoft Surface Pro 7: The Better Choice," in which the company compares its tablet computer to Apple's 13-inch M1 MacBook Pro, as spotted by MSPoweruser. The ad highlights the Surface Pro 7's touchscreen and included stylus as opposed to only a "little bar" (the Touch Bar) on the MacBook Pro. Other advantages of the Surface Pro 7...
apple watch black unity

Apple Celebrates Black History Month With Limited-Edition Watch, Featured Apps and Books, and More

Tuesday January 26, 2021 6:14 am PST by
Apple today announced that it will be celebrating Black History Month with curated content that highlights and amplifies Black creators, artists, developers, and businesses across the App Store, Apple Music, the Apple TV app, Apple Books, Apple Podcasts, and more. The content will be featured throughout the month of February. Black Unity Sport Band has "Truth. Power. Solidarity." ...
7

Apple Releases watchOS 7.3 With Unity Watch Face, Expanded ECG Availability and More

Tuesday January 26, 2021 10:03 am PST by
Apple today released watchOS 7.3, the third major update to the watchOS 7 operating system that was released in September. watchOS 7.3 comes more than a month after watchOS 7.2, an update that brought support for Apple Fitness+ ‌‌The watchOS 7.3 update‌‌ can be downloaded for free through the dedicated Apple Watch app on the iPhone by going to General > Software Update. To install...
time to walk apple watch

Apple Fitness+ Feature 'Time to Walk' Launching Soon With Audio Stories From Special Guests

Saturday January 23, 2021 7:13 pm PST by
Earlier this week, Apple seeded the watchOS 7.3 Release Candidate, which is typically the final beta version of a software update. The release notes for the update list a new "Time to Walk" feature for Apple Fitness+ subscribers, described as "an audio experience in the Workout app where guests share inspiring stories as you walk." Apple Fitness+ subscribers will be able to open the Workout...
apple dan riccio

Dan Riccio Transitioning to New Project, John Ternus to Lead Apple's Hardware Engineering Team

Monday January 25, 2021 2:05 pm PST by
Apple today announced that current Apple hardware engineering SVP Dan Riccio is transitioning to a new role where he will focus on an unspecified project, with John Ternus set to take over as Apple's senior vice president of hardware engineering. In a statement, Apple CEO Tim Cook said that Riccio made Apple a better and more innovative company, and that Ternus will bring a deep expertise...