Taiwan Semiconductor Manufacturing Co., Ltd.
It has been rumored for a number of months now that Apple can be utilizing a brand new 3 nm manufacturing course of from Taiwan Semiconductor (TSMC) for its next-generation chips, together with M3 series processors for Macs and the A17 Bionic for some next-gen iPhones. However new reporting from The Information illuminates a number of the favorable phrases that Apple has secured to maintain its prices down: Apple locations big chip orders value billions of {dollars}, and in return, TSMC eats the price of faulty processor dies.
At a really excessive stage, chip corporations use massive silicon wafers to create a number of chips directly, and the wafer is then sliced into many particular person processor dies. It is regular, particularly early within the lifetime of an all-new manufacturing course of, for a lot of of these dies to finish up with defects—both they do not work in any respect, or they do not carry out to the specs of the corporate that ordered them.
Usually, chip designers must pay for every particular person die whether or not it labored or not; that is a serious cause why corporations promote cut-down or “binned” chips that run at decrease clock speeds or have elements switched off. That method, they will get better some cash from a faulty die as a substitute of none. Apple’s orders with TSMC are apparently massive sufficient that TSMC can afford to not cost Apple for faulty dies.
The financial savings will be fairly substantial for a brand new manufacturing course of. The Info says that roughly 70 p.c of early 3 nm dies have been usable, although this quantity can change primarily based on the chip being manufactured and does usually go up over time as processes are improved.
The Info says that Apple was accountable for 23 p.c of the $72 billion that TSMC made in 2022, making Apple “by far TSMC’s largest buyer.” Stories have been circulating for months that Apple has bought up all of TSMC’s 3 nm manufacturing capacity in the short term, and The Info studies that TSMC’s 3 nm expertise can be unique to Apple for “roughly a 12 months” earlier than there can be capability to permit every other corporations to make use of it.
This deal has apparently been in place since Apple began utilizing TSMC’s factories again in 2014 for the Apple A8 and the iPhone 6. For a time, Apple used multiple sources for its processors, utilizing Samsung-made processors in some iPhones and TSMC-made chips in others. However all of Apple’s chips have been manufactured at TSMC for many of the final decade.
TSMC at present makes many of the high-performance CPUs, GPUs, and SoCs for many of the world’s greatest chip corporations; Apple, Nvidia, AMD, and Qualcomm all use TSMC for his or her most superior merchandise, and plenty of have switched from rivals like Samsung and GlobalFoundries previously few years. Even Intel, which for many of its historical past has solely made Intel-designed chips in its personal factories, is counting on TSMC’s manufacturing for its Arc GPUs and a few elements of its upcoming Meteor Lake processors, even because it tries to open its personal factories to compete with TSMC for enterprise from different chip designers.
Each Samsung and Intel are both delivery or getting ready to ship 3 nm expertise, although it is arduous to match processes throughout totally different corporations—they’re all utilizing totally different underlying expertise, and the Intel 3 course of used to be called “5 nm,” simply to offer you some thought of how broad and hand-wavy a quantity like “3 nm” is. TSMC has had a lead over its rivals for a number of years now, however that may change, and Apple might all the time threaten to go elsewhere if TSMC will not preserve giving Apple favorable phrases.
