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Apple Has Reportedly Rejected TSMC's Chip Price Hike of 6%

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Re: Apple Has Reportedly Rejected TSMC's Chip Price Hike of 6%

#161

Post by Sohcahtoa82 »

colejohnson66 wrote: post #89
_kbh_ wrote: post #56

Earlier quoted context omitted.

Considering Apple funds a lot of TSMC's R&D I dare say they have a lot of leverage if they really wanna push it.

But Apple needs TSMC. Not saying you’re wrong, but TSMC also has leverage. TSMC doesn’t want to price Apple out, but at the same time, Apple can’t just pack up and go to a competitor. At the nodes they’re working at, going to a competitor could require a complete relayout with new design rules.

TSMC needs Apple, but Apple needs TSMC.

Sounds like they're playing a game of chicken.

Re: Apple Has Reportedly Rejected TSMC's Chip Price Hike of 6%

#162

Post by ClumsyPilot »

Sakos wrote: post #72
onceiwasthere wrote: post #59

Being almost completely uninformed on the details of Apple/TSMC's dealings, I'm curious, would Apple ever position themselves to get into chip fabrication? I'm sure there are big reasons this is unlikely but it seems like if anyone could do it, it's Apple.

Honestly, I'm surprised they haven't started yet. If TSMC puts up too much of a fight, they might start internally considering how they would get into chip fabrication. They've already done everything else to great success (and to much surprise), so while the problem seems insurmountable, maybe Apple would be able to do what nobody else has been able to do in decades (aside from the Chinese with significant state inv…

this is such a fantasy, what do yoy expect them to do next, launch thieir own communication network?

Re: Apple Has Reportedly Rejected TSMC's Chip Price Hike of 6%

#163

Post by nebula8804 »

bombcar wrote: post #140
dylan604 wrote: post #69

Earlier quoted context omitted.

Apple: we'll pay no more for this item than ____ TSMC: you'll pay _____ or you can go to the other fab, oh right, you'll pay _____ -------- vendorSellingToBigBox: we would like _____ per unit of our product bigBoxBuyer: that's nice. we'll pay 40%______ per unit. you'll sell extremelyLargeNumberOfUnits, and make it up in volume. oh, if you don't sell a minimum number, you have to buy all of the unsold items back from…

You can actually deduce the vendors that have influence on the big box buyers if you look carefully enough. And some of the vendors will tell Walmart/Costco to take an airborne intercourse course against rolling pastries. Others will sell a white-label or generic brand to them. After all, it's just business.

>You can actually deduce the vendors that have influence on the big box buyers if you look carefully enough.

How? I'm coming up blank. Is there a way to compare prices or quantity against other big box stores?

Re: Apple Has Reportedly Rejected TSMC's Chip Price Hike of 6%

#164

Post by sangnoir »

2OEH8eoCRo0 wrote: post #135
alphabetting wrote: post #7

TSMC charging 6% more for the 3nm process seems reasonable. Article notes Apple accounts for 25% of their revenue and says this gives them leverage over TSMC but aren't they the only 3nm player in town?

> Apple accounts for 25% of their revenue Isn't this misleading? If Apple doesn't take the fab capacity then somebody else will.

AMD will gladly take that up

Re: Apple Has Reportedly Rejected TSMC's Chip Price Hike of 6%

#165

Post by sangnoir »

Joeri wrote: post #160
2OEH8eoCRo0 wrote: post #135

Earlier quoted context omitted.

> Apple accounts for 25% of their revenue Isn't this misleading? If Apple doesn't take the fab capacity then somebody else will.

But will they keep taking that fab capacity over many years and fund the R&D of the next process nodes by buying up guaranteed capacity ahead of time? Apple has been a good partner to TSMC and it would not be wise to replace them for short term gain.

TSMC is not hurting for cash and can easily shoulder the risks - or sell bonds if they'd like prefer to keep the warchest full. There is a long list of customers who'd kill for a chance to get (additional) capacity of the leading edge node process for years at a time (AMD, Nvidia, Google, Amazon, and the rest of the companies giving TSMC the other 75% of revenue)

Re: Apple Has Reportedly Rejected TSMC's Chip Price Hike of 6%

#166

Post by gizmo »

bombcar wrote: post #144
mirzap wrote: post #124

Earlier quoted context omitted.

I don't think you can just drop a pile of cash and create a competitor to TSMC. Even some state actors can not achieve that. I think TSMC has leverage here, and it will have for long time to come.

It may take time, and it may take more money than people want to spend, but I don't see how it can cost much more than half a trillion dollars, since you could just buy TSMC for less than that.

1) TSMC is not for sale. It's of national importance to Taiwan.

2) There is only one TSMC. If you could just buy one for 500bn the EU would have bought 3 already. Building your own TSMC from scratch takes a decade, if not longer.

Re: Apple Has Reportedly Rejected TSMC's Chip Price Hike of 6%

#167

Post by nicoburns »

sangnoir wrote: post #164
2OEH8eoCRo0 wrote: post #135

Earlier quoted context omitted.

> Apple accounts for 25% of their revenue Isn't this misleading? If Apple doesn't take the fab capacity then somebody else will.

AMD will gladly take that up

They will, but I'd guess they probably won't be willing to pay the higher price either (I believe the only reason Apple has the first batch of N3 capacity in first place is because they outbid the competition). So that likely wouldn't leave TSMC any better off.

Re: Apple Has Reportedly Rejected TSMC's Chip Price Hike of 6%

#168

Post by bombcar »

nebula8804 wrote: post #163
bombcar wrote: post #140

Earlier quoted context omitted.

You can actually deduce the vendors that have influence on the big box buyers if you look carefully enough. And some of the vendors will tell Walmart/Costco to take an airborne intercourse course against rolling pastries. Others will sell a white-label or generic brand to them. After all, it's just business.

>You can actually deduce the vendors that have influence on the big box buyers if you look carefully enough. How? I'm coming up blank. Is there a way to compare prices or quantity against other big box stores?

Look for large big box stores that conspicuously have a product line absent, or only have a very defined subset of the product available.

For awhile iPhones were just completely missing from some larger stores, but it seems Apple has the upper hand there now and they're back in business. And even now Apple holds a very right reign on the prices charged (Best Buy seems to have the most leverage here, as they often sell new MacBooks for a bit lower than the Apple Store). This is one of the reasons Apple started the stores; gives them leverage against the retail giants.

There are a number of brands you'll never see at Costco; they don't play the game.

Re: Apple Has Reportedly Rejected TSMC's Chip Price Hike of 6%

#169

Post by cptskippy »

AaronFriel wrote: post #154
plasticchris wrote: post #142

Earlier quoted context omitted.

It can get worse. At one point Walmart mispriced a product then came after my company for the loss. That was an awkward moment. Edit: even worse, now customers expect the lower price, eroding your pricing power.

Walmart will also do this intentionally to their vendors, or engage in what I call temporal arbitrage. It hurts Walmart as a business very little to stop selling Vendor X goods on their shelves when there are substitutes available. However, for Vendor X it's often the case that Vendor X cannot adjust their output as quickly as Walmart can take the product off shelves. That action, taking them off the shelves for even…

There's a book called The United States of Wal-Mart that details a lot of the damage that Wal-Mart has done. I wouldn't be surprised if there's a follow up for Amazon.

https://www.amazon.com/United-States-Wal-Mart-John-Dicker/dp...

Re: Apple Has Reportedly Rejected TSMC's Chip Price Hike of 6%

#170

Post by fckgw »

AaronFriel wrote: post #154
plasticchris wrote: post #142

Earlier quoted context omitted.

It can get worse. At one point Walmart mispriced a product then came after my company for the loss. That was an awkward moment. Edit: even worse, now customers expect the lower price, eroding your pricing power.

Walmart will also do this intentionally to their vendors, or engage in what I call temporal arbitrage. It hurts Walmart as a business very little to stop selling Vendor X goods on their shelves when there are substitutes available. However, for Vendor X it's often the case that Vendor X cannot adjust their output as quickly as Walmart can take the product off shelves. That action, taking them off the shelves for even…

I often think about the pickle story about how Wal-Mart can bully companies and their quest for always low prices have ripple effects.

https://www.barnesandnoble.com/readouts/the-wal-mart-effect-...

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