Apple has tied up three generations of next-gen chips

Apple pre-booked initial supplies of the 5nm chips in today's iPhones as well as the 4nm and 3nm chips coming down the line.

From MacRumors' "Apple Supplier TSMC Readies 3nm Chip Production for Second Half of 2022" posted Friday:

Apple supplier TSMC is preparing to produce 3nm chips in the second half of 2022, and in the coming months, the supplier will begin production of 4nm chips, according to a new report from DigiTimes.

Apple had previously booked the initial capacity of TSMC's 4nm chip production for future Macs and more recently ordered TSMC to begin production of the A15 chip for the upcoming iPhone 13, based on an enhanced 5nm process.

Today's report outlines a more long-term plan for TSMC, stating that the new 3nm chip process will offer 15% performance boost alongside 30% improved energy efficiency and will enter mass production late next year...

While the report doesn't offer any detail of how the new 3nm chip can be implemented into Apple products, it's safe to assume it's still years away. Apple's 14 chip, currently in the iPhone 12 series and iPad Air, is based on the 5nm process. The M1 Apple silicon also shares the same 5nm architecture.

My take: Other companies have the foresight to plan this far in advance, but only Apple has the free cash to make it happen.

17 Comments

  1. Daniel Epstein said:
    Judging by Apple’s previous behavior the road map they have planned out with development of Apple Silicon included a solid plan at supply requirements. One of the most impressive parts of Apple’s logistics. There have been very few major delays of announced products over the years due to component availability issues. Usually weeks not months or even quarters. Many unannounced delays I am sure. This is one of the big reasons they decided to switch away from Intel. Intel’s product paths issues have been slipping by years. Interestingly Apple did not feel they should add AMD to their mix to compensate for the Intel issues. Their forecast of future performance must be most impressive.

    6
    June 19, 2021
    • Gregg Thurman said:
      We know Apple thinks long term, but just how long is that? Five years is a bandied about number, but I wouldn’t be surprised to learn it was 10 years. Look at how long Apple has been working on AI and Titan. Planning for the financial needs of a 10 year road map requires and extraordinary team.

      4
      June 19, 2021
      • Kirk DeBernardi said:
        …and they just happen to have one, Gregg.

        😉

        0
        June 20, 2021
  2. Robert Paul Leitao said:
    This is a big component of Apple’s capex strategy and the approach has been in place for years. Apple doesn’t just design its own products (including Apple silicon), the company invests with its major manufacturing partners to be sure there will be adequate production capacity and output volume. This results in the most attractive pricing possible while providing the company with a strong competitive advantage.

    12
    June 19, 2021
    • Dan Scropos said:
      RPL, even beyond that, it shows Apple thinks in increments of 5,10 and even 20 years ahead. They have vision and roadmaps that their peers can only envy. Add fragmentation as a major obstacle that their competitors have yet to overcome, and you’re left with a company whose only competition is itself and its stringent internal standards for user experience.

      6
      June 19, 2021
    • David Drinkwater said:
      It’s also good for Apple’s business partners, because they can plan resources for their factories. A physical factory has large (huge) fixed costs, so knowing a committed business plan in advance is very valuable.

      1
      June 20, 2021
  3. Fred Stein said:
    Apple has lapped the competition. And that only applies to the above news story.

    Apple and TSMC are working on breakthroughs in processor to memory throughput which translates to big leaps in performance, new storage to further cut power consumption, and perhaps displays.

    In addition to Apple’s vision and cash, they have better ROI for their semi investments.

    10
    June 19, 2021
  4. Rodney Avilla said:
    “Other companies have the foresight to plan this far in advance”

    Not complete sure this is accurate, maybe so in some cases. Either way, this is a song Fred Stein has been singing for years. And it is a song definitely turning out to be prophetically true.

    2
    June 19, 2021
  5. Bart Yee said:
    Due to a rising risk of COVID variants threatening Taiwan, and alleged interference by China hampering Taiwan’s efforts to secure COVID vaccines, two of Taiwan’s leading tech companies have been authorized by Taiwan to privately buy German BioNtech vaccines and donate them to Taiwan.

    Japan donated 1.24M AstraZeneca doses for medical workers and >85 y/o citizens. The US will provide 750K vaccine doses.

    Who are these tech companies? TSMC and Foxconn’s Yonglin Foundation will each procure and then donate 5 million doses each on behalf of the Taiwan government. TSMC Chairman Mark Liu and Foxconn Chairman Terry Gou have been personally involved in the negotiations. Earlier reports suggested 5 key tech companies including multiple Apple suppliers could be involved in vaccine purchases. Of course, these and other Taiwan companies have huge production and supply line risks if the COVID spike spirals out of control.

    IMO I think we can see Apple’s influence on how TSMC and Foxconn act for the good of others, and yes, maintain an important production capability for themselves and Apple.

    8
    June 19, 2021
  6. Gregg Thurman said:
    When you consider AMD has surpassed Intel on the CISC architecture, Apple has surpassed on the RISC architecture, IBM and TSMC have surpassed on manufacturing process, I’d say Intel’s reign as top dog has peaked and is now in decline

    1
    June 19, 2021
    • David Drinkwater said:
      Where do you propose that IBM manufactures silicon?

      Or anything, really.

      0
      June 20, 2021
      • Gregg Thurman said:
        Anywhere from Seattle north to Canadian border with 30 miles of coast. Beyond being absolutely beautiful it’s a rain forest where the only problem with water is that there may be too much.

        0
        June 24, 2021
  7. If you use Google Earth, search:
    24°46’11″N 121°00’45″E
    Otherwise in any map app search satellite view for:
    Baoshan Township, Hsinchu City, look to the east of Hwy 1, just north of 3. You can’t miss all the TSM fabs in Hsinchu Science Park, poss world’s largest concentration of fabs. Massive chip plants using huge amounts of water Taiwan can barely spare. I’ve actually found the rate they build new fabs in Taiwan incredible. Eastern US or Germany is next site, if the tax credits come through.

    3
    June 19, 2021
    • Bart Yee said:
      Considering how much cooling water (kinda like nuclear power plants) seems to be needed, locations must be carefully chosen for resources including water and power along with skilled workers. Considering the huge drought the Southwest is and will be going through, I wonder if the proposed Phoenix, Arizona fab sites could be at serious risk? Seems to me Portland, Hillsboro, or other Oregon site might be a better site choice where Intel had operated fabs? But there may be huge environmental concerns that drier climes do not have.

      https://www.reuters.com/technology/exclusive-tsmc-looks-double-down-us-chip-factories-talks-europe-falter-2021-05-14/

      1
      June 19, 2021
      • Bart Yee said:
        Plenty of cooling water ought to be available in Wisconsin. I know of a company which already has a lot of land there which is currently underutilized. Might even be good to share that land and make chips first, then the circuit boards which use them right next door?

        1
        June 20, 2021
  8. Kirk DeBernardi said:
    Just watch.

    Be able to secure future chips because of your cash pile will somehow be roped into the antitrust corral.

    1
    June 20, 2021

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