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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%

#261

Post by smugma »

Looks like what this means is not that TSMC or Apple fold or even meet in the middle… the article implies that it’s sort of a stalemate that results in a short term lose-lose: products may get delayed or not be as good as they might otherwise be, investments get pushed out, etc.

Maybe Apple sees this (if we don’t pay, no one else will, so we don’t lose to another, but we don’t get the new fab) and thinks this is the optimal outcome. They are batting down the hatches prepared for a recession (and impacts of a super strong dollar), and cutting spending ahead of an expected demand drop.

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

#262

Post by necovek »

solarkraft wrote: post #75
necovek wrote: post #35

Earlier quoted context omitted.

Only if your customers are willing to pay that much. While Apple chips are highly sought after in the West, that's still a minor part of the worldwide market altogether (and while I'd be happy to go back to M1 Max, I couldn't care less for their glossy displays, shallow keyboards and sharp edges — not to mention incomplete Linux support).

... so? The customers they do have pay ridiculously high prices. Even a 6% rise of the full unit price would barely register, especially considering the increase in performance, which would probably easily justify 20%.

Or they could simply wait it out, use the new process on the next generation, and justify upgrades by the performance jump.

IOW, they can keep the cycle going for longer.

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

#263

Post by mirzap »

rowanG077 wrote: post #178
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.

Of course you can. China is doing it right now without ASML even. There is nothing special about TSMC here. It's just funding and time. If Apple wanted to I wouldn't doubt they could reach cutting edge tech level within 5 to 10 years. It would cost enormous amounts of money and would probably be a very bad business move. But technically there is no problem.

China is proof that you can not just create competitor to TSMC. China throws billions for decades and it still behind TSMC. They already lost chip war, that's why they are trying to catch up in some other new technologies - nuclear (fusion), AI, space etc.

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

#264

Post by dirtyid »

mirzap wrote: post #263
rowanG077 wrote: post #178

Earlier quoted context omitted.

Of course you can. China is doing it right now without ASML even. There is nothing special about TSMC here. It's just funding and time. If Apple wanted to I wouldn't doubt they could reach cutting edge tech level within 5 to 10 years. It would cost enormous amounts of money and would probably be a very bad business move. But technically there is no problem.

China is proof that you can not just create competitor to TSMC. China throws billions for decades and it still behind TSMC. They already lost chip war, that's why they are trying to catch up in some other new technologies - nuclear (fusion), AI, space etc.

China is proof you can just create a competitor of TSMC. It's simply a matter of poaching their underpaid talent.

> China throws billions for decades

PRC's first pseudo-serious semi push was 2014 big funds, so far they've spent about 50B, over 8 years. That's less than annual R&D of western semi sector. And basically for first 5 years it wasn't a very serious effort until Trump's Huawei sanctions. PRC semi poached about ~3000 semi engineers from TW, a few hundred top talent from TSMC, and that was enough to realize the recent 7nm breakthrough on DUV in the last couple years once PRC semi started to get serious. US companies wouldn't have any issue accessing western equipment and US could absolutely pressure TSMC / TW into further semi capitulation. So maybe dropping cash and add political sticks to brain drain TSMC. The secret isn't to recreate TSMC, but to paperclip all their people and get to to build US-SMC state side.

> lost chip war

That remains to be seen, so far there hasn't been any sector PRC couldn't successfully indigenize in relatively short order once central gov started turning the screws. It might not be leading edge, or even commercially competitive, but it will likely be enough. They could also destroy critical East Asian semi supply chain before US can reshore in next few years and be the only country with the most comprehensive indigenous semi supply chain even if on older nodes. Still lots of ways chip war can play out.

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

#265

Post by dan1234 »

philistine wrote: post #258
choko wrote: post #240

Earlier quoted context omitted.

I'm not a fan of comparisons like that because they don't account for cost or standard of living between counties, just raw exchange rates. It would be especially pronounced when including countries like India and Russia.

You're right, but when the numbers are so lopsided on the US' favour, there's no way in hell that cost of living can account for such a stark difference. I mean, the US has 20 aircraft carriers and the rest of the world has 28. The proof is in the pudding.

The proof is actually in the eating, not the pudding.

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

#266

Post by rowanG077 »

mirzap wrote: post #263
rowanG077 wrote: post #178

Earlier quoted context omitted.

Of course you can. China is doing it right now without ASML even. There is nothing special about TSMC here. It's just funding and time. If Apple wanted to I wouldn't doubt they could reach cutting edge tech level within 5 to 10 years. It would cost enormous amounts of money and would probably be a very bad business move. But technically there is no problem.

China is proof that you can not just create competitor to TSMC. China throws billions for decades and it still behind TSMC. They already lost chip war, that's why they are trying to catch up in some other new technologies - nuclear (fusion), AI, space etc.

China is proof that you can do it within a decade. China at worst started a decade ago and for the majority of that time wasn't pushing hard, until Trumps sanctions hit. Now they have 7nm DUV. I don't see how this is anything but a huge success for China.

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

#267

Post by anaganisk »

ClumsyPilot wrote: post #162
Sakos wrote: post #72

Earlier quoted context omitted.

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?

Thats the easiest thing they could try.

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

#269

Post by anaganisk »

diebeforei485 wrote: post #141

Apple tends to be overly concerned about every half cent in the bill of materials. This is why many of their accessories have substandard (weak) processors and flopped. HomePod used a 4 year old chip which wasn't very responsive to voice commands.

You dont become rich by spending.

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

#270

Post by anaganisk »

adamsmith143 wrote: post #85
mtoner23 wrote: post #12

1. Crazy to me to think apple can't absorb 6% price hike on chips. their margins are usually so high. 2. But its awesome that apple can say no to price hikes. This is good economics for end users and its a reason why capitalism and markets are often good and produce lower prices

> 1. Crazy to me to think apple can't absorb 6% price hike on chips. their margins are usually so high. What makes you think they'd eat that? Would consumers balk at or even notice a 6% increase in price on their next Iphone? Even if they did Apple could just say "Inflation sry"

Probably this will stop including the lightning cable and the stickers.
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