Chip may or may not be A6

Taiwan Semiconductor Manufacturing Co. has begun trial production of a next-generation processor for Apple, sources for both Reuters and Taiwan Economic News claim. While the Reuters sources suggest that the name of the processor is uncertain, TEN's industry contacts say it will be called the A6, in keeping with Apple's naming scheme so far. The publication moreover says that production design should be taped out in Q1 2012, with a public reveal taking place in Q2. The latter would be consistent with Apple's normal timetable for iPad launches.

TSMC is reportedly using its latest 28nm process and 3D stacking to work on the processor. The TEN sources add that TSMC has technically been capable of building Apple processors in the past, but didn't fish for contracts because of limited production lines that were already close to capacity via clients like NVIDIA and Qualcomm. A sagging industry has allegedly given TSMC more breathing space.

Reuters observes that TSMC has also budgeted $7.8 billion this year to upgrade technology and capacity. One of the wire service's sources cautions that while TSMC has been given authorization and details, any formal order from Apple will depend on yield rates during the trial.

Analysts contacted by Reuters say that TSMC's biggest obstacle is Samsung. While Apple may want to sever ties with the company because of patent disputes and the threat of rival smartphones and tablets, Samsung is currently the lone supplier of the Apple A5 chip used in the iPad 2. Other Samsung patents are said to cover the A-series system design and memory packaging, and even if Apple is able to work around that Samsung may offer discounts or bundling on parts to retain its orders. Regardless, TSMC might only take a portion of orders if it wins a contract, about 20 to 30 percent according to one speculative estimate.

by MacNN Staff