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Apple is fighting for TSMC capacity as Nvidia takes center stage

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Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#281

Post by high_na_euv »

bethekidyouwant wrote: post #141
anoojb wrote: post #138

Earlier quoted context omitted.

So let's say TMSC reciprocated Apple's consistency as a customer by giving them preferential treatment for capacity. It's good business after all. However, everyone knows that good faith reciprocity at that scale is not rewarded. Apple is ruthless. There are probably thousands of untold stories of how hard Apple has hammered it's suppliers over the years. While Apple has good consumer brand loyalty, they arguably tre…

Agreed TSMC can do whatever they want. in 2027 no other fabs will match what tsmc has today, anything that requires the latest process node is going to get more expensive, so your apple silicone and your AMD chips

As of today Intel is very around leading node

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#282

Post by nonethewiser »

SecretDreams wrote: post #11
01100011 wrote: post #9

That's great! Apple has the resources to incentivize and invest in alternate production capacity(Intel, Samsung, or others). Sure, it will take years, but a thousand mile journey begins with one step...

Apple is actually a big reason why TSMC is the king of fabs today. They were a reliable cash source for years before TSMC was even ahead of Intel. Apple can and should do it again!

Fabs are in kind of a catch 22. They need big business to improve and to get lots of business they need to be competitive. Im mostly familiar with that narrative in terms of Intel's current uphill battle - was it really the same for TSMC? I guess maybe there was a similar dynamic except the playing field was more even at that time, so it was a bit less of a catch 22.

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#284

Post by chuckadams »

jonas21 wrote: post #277
Fiveplus wrote: post #6

Calling Nvidia niche feels a bit wild given their status-quo right now, but from a foundry perspective, it seems true. Apple is the anchor tenant that keeps the lights on across 12 different mature and leading-edge fabs. Nvidia is the high-frequency trader hammering the newest node until the arb closes. Stability usually trades at a discount during a boom, but Wei knows the smartphone replacement cycle is the only pr…

AI capex may or may not flatten in the near future (and I don't necessarily see a reason why it would). But smartphone capex already has. Like smartphones, AI chips also have a replacement cycle. AI chips depreciate quickly -- not because the old ones go bad, but because the new ones are so much better in performance and efficiency than the previous generation. While smartphones aren't making huge leaps every year li…

> AI chips depreciate quickly -- not because the old ones go bad

I've heard that it's exactly that, reports of them burning out every 2-3 years. Haven't seen any hard numbers though.

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#285

Post by boplicity »

anoojb wrote: post #138
Fiveplus wrote: post #6

Calling Nvidia niche feels a bit wild given their status-quo right now, but from a foundry perspective, it seems true. Apple is the anchor tenant that keeps the lights on across 12 different mature and leading-edge fabs. Nvidia is the high-frequency trader hammering the newest node until the arb closes. Stability usually trades at a discount during a boom, but Wei knows the smartphone replacement cycle is the only pr…

So let's say TMSC reciprocated Apple's consistency as a customer by giving them preferential treatment for capacity. It's good business after all. However, everyone knows that good faith reciprocity at that scale is not rewarded. Apple is ruthless. There are probably thousands of untold stories of how hard Apple has hammered it's suppliers over the years. While Apple has good consumer brand loyalty, they arguably tre…

Suppliers really hate working with Costco. They're slow to pay, allow for only small margins, and often need too high of a percentage of a businesses revenue, all of which is not friendly towards suppliers.

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#286

Post by bigyabai »

toasterlovin wrote: post #189
bigyabai wrote: post #170

Earlier quoted context omitted.

Nvidia is not a venture capital outlet. They are a self-sustaining business with several high-margin customers that will buy out their whole product line faster than any iPhone or Mac. From TSMC's perspective, Apple is the one that needs financial assistance. If they wanted the wafers more than Nvidia, they'd be paying more. But they don't.

> several high-margin customers This is the "venture capital and hype" being referred to, not Nvidia themselves.

But Nvidia has had high-profile industry partners for decades. Nintendo isn't "venture capital and hype" nor is PC gaming and HPC datacenter workloads.

That line is purified cope.

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#287

Post by Tuna-Fish »

apercu wrote: post #144
Fiveplus wrote: post #6

Calling Nvidia niche feels a bit wild given their status-quo right now, but from a foundry perspective, it seems true. Apple is the anchor tenant that keeps the lights on across 12 different mature and leading-edge fabs. Nvidia is the high-frequency trader hammering the newest node until the arb closes. Stability usually trades at a discount during a boom, but Wei knows the smartphone replacement cycle is the only pr…

"Apple is smart. If the AI capex cycle flattens in late '27 as models hit diminishing returns, does Apple regain pricing power simply by being the only customer that can guarantee wafer commits five years out?" That's the take I would pursue if I were Apple. A quiet threat of "We buy wafers on consumer demand curves. You’re selling them on venture capital and hype"

Why should that change TSMC decision making even a little?

The reality is that TSMC has no competition capable of shipping an equivalent product. If AI fizzles out completely, the only way Apple can choose to not use TSMC is if they decide to ship an inferior product.

A world where TSMC drains all the venture capital out of all the AI startups, using NVidia as an intermediary, and then all the bubble pops and they all go under is a perfectly happy place for TSMC. In these market conditions they are asking cash upfront. The worst that can happen is that they overbuild capacity using other people's money that they don't have to pay back, leaving them in an even more dominant position in the crash that follows.

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#289

Post by thewebguyd »

lukan wrote: post #276
philistine wrote: post #265

Earlier quoted context omitted.

Apple has used both Samsung and TSMC for its chips in the past. Until the A7 it was Samsung, A8 was TSMC, and the A9 was dual-sourced by both! Apple is used to switching between suppliers fairly often for a tech company; it's not that it's too hard for them to switch fab, it's that TSMC is the only competitive fab right now. There are rumours that Intel might have won some business from them in 2 years. I could total…

But wasn't the reason they split with Samsung because they copied the iphone in the perspective of Jobs (to which he reacted with thermonuclear threats)? They did had the expertise building it after all. What would happen, if TSMC now would build a M1 clone? I doubt this is a way anyone wants to go, but it seems a implied threat to me that is calculated in.

Job's thermonuclear threats were about Android & Google, not Samsung because Schmidt was on Apple's board during the development of Android.

> "I will spend my last dying breath if I need to, and I will spend every penny of Apple’s $40 billion in the bank, to right this wrong. I’m going to destroy Android, because it’s a stolen product. I’m willing to go thermonuclear war on this."

The falling out with Samsung was related, but more about the physical look of the phone

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#290

Post by erxam »

bpodgursky wrote: post #132
alex43578 wrote: post #31

Earlier quoted context omitted.

Is time on their side? Long term: demographics are worsening for China relative to now or 5 years ago. Short term: China doesn’t yet have viable homegrown replacements for ASML, TSMC, etc. Really short term: China blockading Taiwan and suffering the economic fallout would be much more painful than US blockading Cuba/Venezuela/etc. A decisive kinetic action or a very soft political action, rather than a blockade seems…

My point is that China can sustain a naval blockade of Taiwan nearly indefinitely, and at some point Taiwan will have to decide whether they want to live under siege forever (poor, cold, getting everything via scarce and expensive air freight), or give up come to a political solution. I'm not like, rooting for this, I'm just trying to be realistic.

That's exactly what the USA has been doing to Cuba since 1959 and they're still (barely) hanging around. If we go by that example, it'll only end with with an actual invasion (which is what will happen to Cuba within one to two years).
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