Exclusive partner is another word for single point of failure
Subject: General Tech | August 30, 2012 - 02:38 PM | Jeremy Hellstrom
Tagged: TSMC, apple, qualcomm, fab
If you believe the rumours, TSMC recently turned down offers from both Apple and Qualcomm to make those companies the exclusive partner of TSMC's smartphone chip production. Now, that sort of deal does tend to line the pockets of the supplier quite nicely, as the customer must pay to recompense the lost business from other customers. It also gives the manufacturer the ability to specialize their production lines for one specific type of chip which will eventually bring the cost per wafer down. On the other hand, this type of deal can stifle innovation on a general level as the manufacturer doesn't need to worry about attracting other customers, nor designing fabrication plants capable of producing multiple types of chips. Then there is TSMC in specific, a company which has a long history of providing supplies to companies both sides of the war, be it GPU, CPU or a mixed chip. As arms dealers proved long ago it is far more profitable to sell to both sides than to only supply one belligerent. Read DigiTimes take on this topic here.
"A recent Bloomberg report cited unnamed sources as saying that Apple and Qualcomm had been rebuffed in separate attempts to invest cash in Taiwan Semiconductor Manufacturing Company (TSMC) in a bid to secure exclusive access to smartphone chips. Digitimes Research analyst Nobunaga Chai has commented saying that he sees no good reason why TSMC should accept the investment."
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