A report from Economic Daily News last week revealed that TSMC told Apple that it would increase the price of the company’s chip production for 2023, but Apple reportedly rejected the new prices. However, Economic Daily News is now back with a new report, this time saying that Apple has decided to agree to price increases for TSMC’s chips.
TSMC chips getting more expensive
According to the report, TSMC has informed its customers (such as Apple and Nvidia) that it has plans to raise the prices of up to 8-inch chip wafers by 6% and 12-inch chip wafers by up to 5%. At first, Apple reportedly told the Taiwanese semiconductor manufacturer that it wouldn’t accept the price increase. But today’s news suggests that Apple will pay the new price set by TSMC.
Apple is one of TSMC’s major customers, the company supplies chips for Apple devices such as iPhone, iPad, and Mac. Given the high number of orders Apple places every year, it’s easier for the company to negotiate better prices. Even so, some price increases are inevitable due to the current global economic situation.
Economic Daily News notes that despite lower demand for smartphones, computers, and tablets this year, chip shortages are still affecting the entire industry.
TSMC is reportedly working on Apple’s new A17 Bionic chip, which will be the first to be built with the 3-nanometer process. The same technology is expected to be used to make Apple’s M3 chips in the future. Apple’s A16 Bionic chip, also built by TSMC, uses 4-nanometer technology. However, Apple has kept it exclusive to the more expensive iPhone 14 Pro models.
This suggests that Apple may follow the same approach for other products in the future, keeping the new, more expensive chips for its premium products.
Samsung might join the race
In the meantime, Samsung has been racing to compete with TSMC in building chips with the 3-nanometer process. It’s worth remembering that Samsung provided Apple with A-series chips until the iPhone 6s. Then, in 2016, iPhone 7 was the first model to have chips made exclusively by TSMC.
If the South Korean company succeeds in building 3-nanometer chips, perhaps it could become one of Apple’s suppliers for upcoming products.
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