Is Apple Really Cutting Out Samsung?
Taiwan Semiconductor Manufacturing Co. (NYSE:TSM) is said to have started trial production of A6X chips for Apple (NASDAQ:AAPL) in a move that will cut down the iPhone maker’s supply reliance on Samsung (SSNLF.PK). Trial production will begin in the first quarter of this year, according to Taiwan’s Commercial Times.
While Apple has been the biggest customer of Samsung mobile processors for years, the rivalry between the two companies in the smartphone arena as well as the growing number of mutual lawsuits have frayed the relationship. Even though Samsung manufactured the A6 chip used in the latest iPhone, Apple kept the design process in-house. The iPhone maker has been reported to be looking for a way out for some months now.
Our 20-page proprietary analysis of Apple’s stock is ready. Click here to get your Cheat Sheet report now.
In November, it was reported that Samsung had increased the price of its mobile processors by 20 percent just for Apple, but the Korean company denied the news.
At the moment, all mobile processors used in the iPhone, iPad, iPod touch, and Apple TV are built by Samsung, with Apple ordering about 200 million of them a year. A complete transition, then, could take as many as 18 months to complete and it’s still unclear if TSMC chips will appear in Apple’s iOS devices anytime soon, considering this first step is just a trial. Along with, TSMC, which is the world’s largest dedicated independent semiconductor foundry, Apple is also said to be exploring other options, including Intel (NASDAQ:INTC).
Don’t Miss: Analyst: Here’s a Breakthrough Apple Product.