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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

#31

Post by alex43578 »

bpodgursky wrote: post #26
Antibabelic wrote: post #15

Earlier quoted context omitted.

I feel like China invading Taiwan isn't happening in our lifetimes. Yes, they stand to benefit from it, but I doubt any of the people in charge of decision making are that interested in rocking the boat. There's nobody forcing their hand and the country is doing great without needing to invade anyone.

They are 100% going to force the issue. It will likely be a naval plus air blockade to force a political solution to avoid the messiness of an invasion, but time is on China's side there.

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 more viable in the current state.

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

#32

Post by dangus »

boxed wrote: post #18

Tim Cook failing on the Cook doctrine ("We believe that we need to own and control the primary technologies behind the products that we make") is ironic.

Owning a leading edge fab is not practical for most companies, even huge some ones like Apple.

Intel has even struggled with it since they traditionally didn’t sell capacity to other buyers. It worked for Intel because they traditionally had a near-monopoly over the laptop, desktop, and server chip market.

Apple certainly has the money to spin up their own chip fabricator, but there’s no guarantee it would be as good as TSMC, it would cost billions, and they would have less of an ability to sell capacity to other customers.

At the end of that effort they could be left with a chip fab that produces chips that still cost the same or more than what TSMC manufactures them for. It might just be cheaper to try and outbid Nvidia for priority.

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

#33

Post by petcat »

adventured wrote: post #24
WesolyKubeczek wrote: post #10

...and then China invades Taiwan, and nobody ain't getting nothing.

The US has its own TSMC supply (insert comments about it not being cutting edge). And the US will stand-down and let China take Taiwan with no serious conflict in exchange for supply agreements. Not more than 5-10 years out at this point. The US can't even remotely come close to stopping China in its own backyard today, in another 5-10 years they'll just have that much larger of a Navy. The US knows that's the situat…

> The US has its own TSMC supply (insert comments about it not being cutting edge)

USA has been strategically re-homing TSMC to the US mainland for a long time now. 30% of all 2nm and better technologies are slated to be produced in Arizona by 2030.

The real loser in all of this will be the EU which will be completely without the ability to produce or acquire chips. They'll just end up buying from China and USA, which will only further deepen their dependence on those countries.

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

#35

Post by rob74 »

Antibabelic wrote: post #15
WesolyKubeczek wrote: post #10

...and then China invades Taiwan, and nobody ain't getting nothing.

I feel like China invading Taiwan isn't happening in our lifetimes. Yes, they stand to benefit from it, but I doubt any of the people in charge of decision making are that interested in rocking the boat. There's nobody forcing their hand and the country is doing great without needing to invade anyone.

Let's hope China doesn't get a leader like Donald Trump in our lifetimes, then I think your prediction will apply. Despite the political tensions, China and Taiwan are so deeply integrated economically that an invasion would hurt not only Taiwan and the global economy, but also China (directly and indirectly). The EU and the US are making efforts to re-shore some semiconductor manufacturing, but TSMC and others will probably still keep a sizable amount of manufacturing in Taiwan, so I don't think this interconnectedness will change anytime soon...

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

#36

Post by Fiveplus »

alex43578 wrote: post #23
Fiveplus wrote: post #20

Earlier quoted context omitted.

I think it is less of a trade and more of a symbiotic capital cycle, if I can call it that? Nvidia's willingness to pay exorbitant prices for early 2nm wafers subsidizes the R&D and the brutal yield-learning curve for the entire node. But you can't run a sustainable gigafab solely on GPUs...the defect density math is too punishing. You need a high-volume, smaller-die customer (Apple) to come in 18 months later, soak…

Isn’t the smaller die aspect more valuable early in the node’s maturity, where defects are less punishing?

That is the traditional textbook yield curve logic, if I'm not wrong? Smaller area = higher probability of a surviving die on a dirty wafer. But I wonder if the sheer margin on AI silicon basically breaks that rule? If Nvidia can sell a reticle-sized package for 25k-30k USD, they might be perfectly happy paying for a wafer that only yields 30-40% good dies.

Apple OTOH operates at consumer electronics price points. They need mature yields (>90%) to make the unit economics of an iPhone work. There's also the binning factor I am curious about. Nvidia can disable 10% of the cores on a defective GPU and sell it as a lower SKU. Does Apple have that same flexibility with a mobile SoC where the thermal or power envelope is so tightly coupled to the battery size?

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

#37

Post by alephnerd »

weslleyskah wrote: post #30
ndr42 wrote: post #16

I dislike this dramatization in reporting of mundane facts. So report the facts but sentences like "What Wei probably didn’t tell Cook is that Apple may no longer be his largest client" make it personal, they make you take sides, feel sorry for somebody, feel schadenfreude... (as you can observe in the comments)

I hate this writing as well. Is not about technology and finance? The reporter writes as if it is a novel.

It's written in "HBS case study" tone. You might not like it, but frankly, ICs aren't the target demographic anyhow.

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

#38

Post by alex43578 »

adventured wrote: post #24
WesolyKubeczek wrote: post #10

...and then China invades Taiwan, and nobody ain't getting nothing.

The US has its own TSMC supply (insert comments about it not being cutting edge). And the US will stand-down and let China take Taiwan with no serious conflict in exchange for supply agreements. Not more than 5-10 years out at this point. The US can't even remotely come close to stopping China in its own backyard today, in another 5-10 years they'll just have that much larger of a Navy. The US knows that's the situat…

Yeah, I just don’t know that there’s the will to blow up the world economy for which flag flies over Taiwan.

China absorbing Taiwan (especially to Americans) just doesn’t seem like a radical, terrifying concept.

A Hong Kong style negotiated transfer might be best for the world - Taiwanese that want to leave can, the US can build up a parallel source of semiconductors, China gets Taiwan without firing a shot.

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

#39

Post by YmiYugy »

It seems a bit odd that data center operators aren’t willing to put their money where their mouth is. Data center operators say: expand more quickly. TSMC says: we need long term demand to justify that. And all the data center guys say is: don’t worry that won’t be an issue, trust us. I would think that if they were serious they would commit to cofinancing new foundries or signing long term minimum purchasing agreements.

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

#40

Post by rob74 »

petcat wrote: post #33
adventured wrote: post #24

Earlier quoted context omitted.

The US has its own TSMC supply (insert comments about it not being cutting edge). And the US will stand-down and let China take Taiwan with no serious conflict in exchange for supply agreements. Not more than 5-10 years out at this point. The US can't even remotely come close to stopping China in its own backyard today, in another 5-10 years they'll just have that much larger of a Navy. The US knows that's the situat…

> The US has its own TSMC supply (insert comments about it not being cutting edge) USA has been strategically re-homing TSMC to the US mainland for a long time now. 30% of all 2nm and better technologies are slated to be produced in Arizona by 2030. The real loser in all of this will be the EU which will be completely without the ability to produce or acquire chips. They'll just end up buying from China and USA, whic…

Just because you haven't heard of it doesn't mean that the EU isn't doing anything: https://overclock3d.net/news/software/bringing_advanced_semi...
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