[Some serious backtracking here from TSMC is a slam dunk to get Apple's business. Looks like the Altera new really shook some people up. Those who just assumed nothing was happening while really big deals were being developed behind closed doors....]
Since Intel has opened up its fabs to other fabless IC firms, the Silicon Valley giant will pose a threat to TSMC at some point when it comes to high-volume orders, including future chip orders from Apple.
TSMC will no longer be the sole supplier of Altera-designed chips. The FPGA vendor has announced plans to use Intel's 14nm FinFET process technology for the manufacture of its next-generation, high-performance product series.
There is no doubt about Intel's manufacturing leadership, said Digitimes Research analyst Nobunaga Chai, when asked to comment on the just-announced partnership between Altera and Intel. Intel remains ahead of TSMC by 1-2 generations in technology, Chai added.
Using Intel's 14m FinFET process will bring Altera's next-generation products more competitiveness against their counterparts provided by Xilinx, in terms of performance, Chai believes.
However, making FPGAs is a lot different from producing application processors for mobile devices, Chai noted. The architecture of a FPGA does yield a high throughput while that of an AP doesn't, Chai continued. In other words, grabbing future chip orders from Altera should not be associated with a greater chance for Intel to land foundry orders for Apple's mobile devices, Chai said.
From the lessons of cooperation with Samsung Electronics, Apple should find a number of reasons not to work with an IDM especially when the architecture it provides deliver better performance and power savings than that provided by the foundry partner, Chai pointed out. Nevertheless, another scenario is that Apple transitions its iPhones and iPads away from the ARM SoCs if Intel is able to provide more competitive solutions for mobile devices, Chai said.
Intel can also utilize and extend further its relationship with memory chipmaker Micron Technology so that it stands a better chance of grabbing future chip orders from Apple, Chai suggested. The capability of manufacturing a single-chip integrated logic and memory device through 3D chip-stacking technology will be a competitive edge for Intel to win an Apple contract, Chai said.
But for now, Chai reiterated his earlier prediction that TSMC is Apple's most-likely partner given that the pure-play foundry's manufacturing efficiency, flexibility and full support to co-work with.
Chai said previously that TSMC with its 20nm SoC process would most likely secure its first chip orders from Apple, and the foundry's 16nm FinFET process would play a key role in Apple's "breakthrough" product.technology.
Sentiment: Strong Buy
Altera going to INTC is a big deal but more of a reflection of Xilinx moving to TSMC than anything else. In the FPGA business whoever is first to a process node wins big market share. Xilinx was at UMC and lagged Altera/TSMC @ 40nm by close to a year and Altera gained huge market share. Xilinx moved to TSMC and beat Altera to 28nm by a month or so. Xilinx will probably beat Altera to TSMC 20nm as well.
Since Altera prefers a high performance process they can probably use the same Intel process as the microprocessors, not the SoC ultra low power version which is a big challenge for INTC. If so Altera can beat Xilinx to 14nm by a significant margin and win back market share.
Apple is at TSMC 20nm. For 14nm they will probably use Samsung again which will ramp about the same time as Intel 14nm SoC or maybe earlier. Xilinx will probably use Samsung 14nm as well. IMHO
I don't forsee Apple staying with ARM too much longer. It is not a big secret that Apple wants to develop their own chips. It is doubtful that they would want to continue to pay royalties for ARM and have the kind of restriction on them that using ARM creates. It just isn't Apples style. They will probably lease space at a fab and design their own chips at some point. I don't think Intel will cooperate with this since Apple is a big player in the mobile space and Intel does not want to help them out. No I see Apple using TSMC foundries to make their chips.
"I don't forsee Apple staying with ARM too much longer. It is not a big secret that Apple wants to develop their own chips. It is doubtful that they would want to continue to pay royalties for ARM and have the kind of restriction on them that using ARM creates. "
Apple switched from using ARM cores to licensing the ARM architecture and creating custom cores fitted for iOS on the iPhone5. QCOM was the first to do this with Snapdragon. Others like Samsung will follow. When will Intel license the Atom architecture again? That would be never.