updated 10:35 pm EDT, Thu September 15, 2011
TSMC contract with Apple to last at least a year
More details of TSMC's deal with Apple have emerged that suggest it will at least be a two-generation pact. Insiders reported late Thursday that it would include both the 28 nanometer process chips widely reported as well as a smaller-still 20 nanometer process. The move outlined for Digitimes would not only have TSMC make the A6 but the A7, presumably arriving in early 2013.
The Taiwan chip producer supposedly negotiated a healthy margin on the contract as well, making both sides happy. Apple is known for hard dealing with partners that can see them forced to make products at a low cost and count on sheer volume, not just the per-device profit.
TSMC's main sacrifice might be having to split orders for chip packaging and testing with another company out of its limited capacity to handle secondary elements. Neither side is known to have hashed out the details of this extra component.
Apple's reasons for switch to TSMC aren't definite but could be multiple. Many have speculated that the A6 would go to TSMC just to spite its normal supplier and mobile rival Samsung, but TSMC may also have been chosen simply to get the company with the most advanced manufacturing technique at the necessary time. The A6 is presumed to be quad-core and may need 28nm to give the battery life and speed Apple expects. NVIDIA is still expected to use 40nm designs with its own Kal-El (Tegra 3) quad-core design and may suffer next to Apple, even though the choice lets it gets processors out first.