Samsung Exclusive Chip Supplier Contract With Apple to Expire This Year

The Economic Daily News reports (via Macotakara) that Apple’s so-called A7-chip will be built on a smaller 20nm process next year. Rumour has it that TSMC and not Samsung will build the chip.


The report highlights that Apple and Samsung had an exclusive supply contract for A-series chips, but the contract will expire in June of this year.

Samsung, Apple’s long-time partner, is still awaiting orders for an A7-chip for the iPhone 6 next year. Since the official order hasn’t been placed, internal pressure is soaring alongside speculations that Apple will likely switch to TSMC.

The partnership between Apple and the Taiwanese semiconductor company has been rumoured for a while now, with some voices whispering about a certain split in orders between Samsung, TSMC and Intel.

TSMC has high hopes for the upcoming 20nm chip production process, which will debut in 2014. Industry sources report that the company has started installing production equipment at its Fab 14 – the first of its foundries to manufacture 20nm SoC – two months ahead of schedule.

This means TSMC will begin volume production at the end of the second and shipments “will gain momentum in the second half of the year.”

Because 20nm SoCs are expected to be TSMC’s major competitive advantage in competing for Apple Inc.’s orders for its next-generation A7 processor, the company has attached great importance to the foundry’s construction, the reports said.

In an unusual move, the reports said, TSMC has sent more than 100 engineers to equipment manufacturers in the United States, Europe and Japan to conduct quality checks to make sure that its new plant can start operations in the new time frame.

As we previously reported, Apple has been preparing for the switch from Samsung as its chip supplier. However, both Apple and TSMC are silent, so those predictions have yet to become reality.