Apple is playing off TSMC against Samsung to negotiate better prices for its A9 chips for the iPhone 6s and 6s Plus, according to a new report.
Competition between TSMC and Samsung to win Apple’s business has been fierce over the past year, with the conflict even going as far as a lawsuit over the alleged leaking of trade secrets.
With both companies having the 14/16nm FinFET process capacity to build A9 chips to Apple’s specifications, Apple is reportedly asking both sides to cut their prices — or potentially lose out on future business.
Samsung is said to have already agreed to offer bulk discounts to Apple. On top of this, it is also throwing in “almost-free backend services” for the A9 chips, in an attempt to price its rival manufacturer out of Apple business. The strategy could be working, too, since TSMC is apparently refusing to drop prices, which could result in a cutback in A9 chip orders from Apple.
Apple previously made things difficult for both companies by requesting modifications to the mask patterns prior to A9 chip production, prompting both TSMC and Samsung to rework their wafers on short notice.
Potentially pouring salt on the wound is the fact that Apple is alleged to have cut the number of A9 chips it is asking for. TSMC originally planned to produce a monthly output capacity of 30,000 wafers — which are later cut down into smaller chips — but may now have to reduce this to less than 20,000 units due to Apple’s cutbacks.
This isn’t to suggest that TSMC is out of the game, though. When it was originally reported that Samsung may have secured all the A9 orders from Apple, none other than Foxconn’s CEO Terry Gou got involved to lobby on behalf of TSMC, primarily due to his concerns about Samsung’s status as an Apple manufacturer.
Source: Digitimes
