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Apple Reportedly Buys Into a Chip Fab, Looking to Produce Its Own Chips

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Original poster
Apr 12, 2001
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SemiAccurate reports that Apple is ramping up its efforts to control its own supply chain, seeking to produce its own chips and buying into a chip fabrication facility to accomplish that goal.
Apple has just done something that SemiAccurate has been expecting for months and entered the fab industry. No we are not joking, Apple just bought into a fab, and not in a trivial way either.
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With the majority of the report behind a paywall, details remain scarce, but the teaser walks through how Intel, TSMC, Global Foundries, and IBM are unable to entirely meet Apple's chip needs as it looks to move away from Samsung as the manufacturer of A-series chips for its iOS devices.

Tags associated with the article include all of those companies, as well as "UMC", which undoubtedly refers to United Microelectronics Corporation, a Taiwanese semiconductor company with a focus on the foundry business, hinting that UMC may be involved in Apple's effort in some manner. UMC currently operates a number of fabs in Taiwan, and also has a facility in Singapore that the company just weeks ago designated as its Center of Excellence for advanced specialty process technologies.

Any move by Apple to produce its own chips is almost certainly years in the future given the difficulty of building up that expertise, and so Apple will need to continue relying on manufacturing partners for its A-series chips for the foreseeable future. Just last month, TSMC reportedly confirmed that it has struck a deal to produce A-series chips for Apple, offering the iOS device maker a path to minimize its reliance on Samsung. The TSMC deal comes after years of rumors as TSMC suffered from technical glitches and other issues that kept Apple from committing to the chipmaker.

SemiAccurate has a mixed track record, having correctly predicted Apple's shifts in graphics chip suppliers for its Mac lines several times, but also incorrectly claiming in May 2011 that Apple would soon be moving its Macs to ARM processors. More recently, the site has been keeping on top of Apple's work to recruit AMD engineers for its "Orlando GPU Design Center".

Update: CNET says that the report cites Globalfoundries as Apple's partner in the fab project. CNET's own sources indicate that the two companies are still "kicking the tires" and that no deal has been yet been reached.
"This isn't the first time. [Apple and Globalfoundries] have kicked the tires before. But [Apple] is doing this again to look at a fab to offset risk," said the source.

The source continued: "Globalfoundries and Samsung have the same technology foundation based on an IBM joint development agreement. So that gives [a possible deal] a little less risk if they're looking at a secondary option to offset [the current chip manufacturing] with Samsung. Samsung's fab in Austin and GF's fab in New York could both ramp a similar product and GF could offset capacity that Samsung can't fulfill."
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Article Link: Apple Reportedly Buys Into a Chip Fab, Looking to Produce Its Own Chips
 
Article Link
https://www.macrumors.com/2013/07/12/apple-reportedly-buys-into-a-chip-fab-looking-to-produce-its-own-chips/
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locoboi187

macrumors 6502a
Oct 3, 2012
711
375
Hope this means we get slightly cheaper prices due to direct manufacturing. But no high hopes here :p
 
StrongArmmed

StrongArmmed

macrumors regular
Aug 10, 2010
109
95
Miami, FL
Excellent move by Apple to become more vertically-integrated.

If they can fairly rapidly acquire the human expertise required, this may be a transformative moment for the Shiny Fruit Gang.

Removing Samsung from the supply chain is critical for Apple, as you can be sure there was no "firewall" between divisions of that company and some of Apple's valuable business knowledge shared with the chip fab, display, and memory divisions of Samsung "found it's way" to the mobile device group...
 
jimsowden

jimsowden

macrumors 68000
Sep 6, 2003
1,766
18
NY
What is this macrumors, a freshman psych paper? Buy the report if you're going to quote all of its pertinent information.
 
Y

yeah

macrumors 6502a
Jul 12, 2011
978
291
Introducing the iTransistor, with new Apple-type connections and silicon-infused apples :D:apple:

Seriously, keep up the processor research and design Apple, because this Macrumors user is going to work for you in the future :)
 
C

cgk.emu

macrumors 6502
May 16, 2012
449
1
Battlefield Fan said:
So much for innovating. Apple just buys out start up places and rebrands it.
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How much innovation can they really do in regards to chips?? That's not really their business. Also, how many other companies out there buy technology and use it as their own? Tons, in fact, they all do. Why? Because it's cost effective, it just makes sense.

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yeah said:
because this Macrumors user is going to work for you in the future :)
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Well...you don't lack for confidence.
 
T

Tiger8

macrumors 68020
May 23, 2011
2,479
649
Battlefield Fan said:
So much for innovating. Apple just buys out start up places and rebrands it.
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Do you read? This is a strategic move that we'll only see its results a few years down the line. They are looking to build expertise in that industry, what's wrong with that?
 
I

iglobe

macrumors newbie
Oct 12, 2012
29
0
Forgetten history

Most people forget that apple bought raycer graphics back in 1998 but the project was stopped in order to save money. Bob mansfield was CTO of raycer graphics at that time, return of bob mansfield at apple after retirement to start building graphics engineering team.lookslike big plan ahead
 
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Intarweb

macrumors 6502a
May 30, 2007
561
0
Have them build a factory here in North'MERICA then I'll care about who they choose as their chip provider.
 
Thunderbird

Thunderbird

macrumors 6502a
Dec 25, 2005
951
789
I hope this is for idevices only. The moment they get into making their own desktop chips, it's goodbye Bootcamp.
 
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Crzyrio

macrumors 68000
Jul 6, 2010
1,587
1,110
Intarweb said:
Have them build a factory here in North'MERICA then I'll care about who they choose as their chip provider.
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If you had a business, would you rather pay 18$ an hour to unionized workers or 2$ an hour in China?

Be happy Apple is atleast doing a tiny bit to bring jobs back to NA.
 
T

techwhiz

macrumors 65816
Feb 22, 2010
1,297
1,804
Northern Ca.
Apple may have invested in a FAB partnership to secure a supply chain, but I doubt that they are going into the Semi Manufacturing business. They invested in LCD manufacturing facilities, but they don't run them.

If they spent the amount of money required to set up a sub 28nm FAB you would see it in the next statement filed with the SEC.

Qualcomm sells many more Snapdragon and baseband parts than Apple does Ax processors and they don't own a FAB. AMD got out of the FAB business.

FABs are expensive and you need at least two independent lines. You can't move to another process node and bring down your FAB line so you need a parallel FAB for a new node.

it only make some sense if Apple is adopting an IBM model and will start making *ALL* or most chips in their products. Then sell excess capacity. I doubt it.

TSMC, UMC, Global Foundries, etc all sink billions in R&D to ramp up a new processes.

I'll believe this story when I see it.
 
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paulrbeers

macrumors 68040
Dec 17, 2009
3,963
123
gpat said:
Fake. Apple always was fabless, and there isn't a good reason to change this.
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While that's true.... It wasn't until a few years ago that Apple owned a chip design company now did they? No reason for a company who builds consumer devices to own a Fab unless they own a chip design company right? I mean what would they do, buy someone else's designs and then FAB someone elses design? Might as well just let them design and build them entirely. However, now that they own the chip design, it only makes sense to move to the next phase and own a FAB. True?
 
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tommyminahan

macrumors regular
Aug 16, 2008
183
139
Thunderbird said:
I hope this is for idevices only. The moment they get into making their own desktop chips, it's goodbye Bootcamp.
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What if they still built them using X64 architecture?
Then they could even go into the PC marketplace with "windows" compatible cpus!
Not saying they would, or should.. just throwing that out there.
 
C

commander.data

macrumors 65816
Nov 10, 2006
1,057
183
techwhiz said:
Apple may have invested in a FAB partnership to secure a supply chain, but I doubt that they are going into the Semi Manufacturing business. They invested in LCD manufacturing facilities, but they don't run them.

If they spent the amount of money required to set up a sub 28nm FAB you would see it in the next statement filed with the SEC.

Qualcomm sells many more Snapdragon and baseband parts than Apple does Ax processors and they don't own a FAB. AMD got out of the FAB business.

FABs are expensive and you need at least two independent lines. You can't move to another process node and bring down your FAB line so you need a parallel FAB for a new node.

it only make some sense if Apple is adopting an IBM model and will start making *ALL* or most chips in their products. Then sell excess capacity. I doubt it.

TSMC, UMC, Global Foundries, etc all sink billions in R&D to ramp up a new processes.

I'll believe this story when I see it.
Click to expand...
I agree. Being vertically integrated and fabbing your own chips sounds good at first glance, but the cost of developing new processes and figuring out what to do with old processes are big problems that need to be explained.
 
P

paulrbeers

macrumors 68040
Dec 17, 2009
3,963
123
Thunderbird said:
I hope this is for idevices only. The moment they get into making their own desktop chips, it's goodbye Bootcamp.
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Why would they? They don't design desktop CPU's and it's already been proven in pure performance ARM is still along way from desktop CPU's (even mobile X86 CPUs) and since Haswell has already proven that X86 CPU's can give you all day run now, there really isn't a need for an A# ARM based processor in a laptop either.

So in conclusion: Intel has significantly reduced their power usage. Apple doesn't design desktop/laptop grade CPU's. So what am I missing?
 
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