Chip foundry TSMC wanted to raise the price it charges Apple to manufacture its 3nm A17 Bionic chip by 3%. Apple said no.
Since the chips produced by TSMC are such an important component, and considering that only Samsung Foundry has the technology to deliver cutting-edge chips like TSMC can, most of the company's customers pay the higher prices with a smile on their faces. But Apple's contribution to TSMC's top and bottom lines is so important that the tech giant actually can refuse to pay higher prices for the assembly of its chips and get away with it.
It is not known how TSMC responded to Apple's refusal to accept a 3% price hike for the 3nm A17 Bionic chips. One would imagine that TSMC would hold the upper hand in this situation due to the lack of foundries with the capabilities that TSMC has. It has to be worrisome enough for Apple that China seems eager to use force to take over Taiwan.
The next few A series chipsets designed by Apple, starting with the A17 Bionic, will be produced by TSMC using its 3nm and enhanced 3nm process nodes. The 2nm process nodeDevice manufacturers had to deal with a chip shortage last year that affected older, legacy silicon as car manufacturers were blindsided by heavier demand for vehicles than expected despite the continuation of the pandemic. Even Apple saw its revenue impacted by the chip shortage to the tune of a $6 billion shortfall.
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