The latest Apple Inc. (NASDAQ:AAPL) rumor indicates the company may tap rival Samsung Electronics Co. Ltd. (LON:BC94) (KRX:0059935) to build A-Series chips next year. This report comes from the The Korea Times. More recent estimations show most of the chips for Apple’s current products are manufactured by Taiwan Semiconductor Manufacturing Company(TCMC) but Samsung still makes about 40% of the chips in the iPhone 6 and iPhone 6 Plus.
Apple may further work with Samsung
One unnamed source close to the deal summed it up, “Apple has designated Samsung as the primary supplier of its next A-series chips powering iOS devices from 2016 as the alliance with GlobalFoundries (GF) enabled Samsung to cut off capacity risk.”
The rumored deal is said to be worth billions of dollars. It would also require the company to produce the chips at plants in South Korea; Austin, Texas; and New York. Shares for Samsung are also expected to grow significantly by 2016 when Apple has Samsung develop 60% of chip production. Unfortunately, this rumor conflicts with earlier reports which indicate TSMC is building up it’s relationship with Apple. There has also been numerous reports the iPhone maker strived to cut complete ties with its rival.
A look back at previous rumors
There has been numerous rumors regarding Apple’s relationships with TSMC and Samsung. Last summer, a report alleged Samsung would take on iPhone and iPad production sooner than initially anticipated. It would start in 2015 with the production of A9.
All up until this year, Samsung was the primary producer of the custom A-series processors. Samsung also happens to be Apple’s biggest competitor in the smartphone and tablet market. Samsung and Apple have been duking it out for years in court. Apple claimed Samsung stole its design and patents, but the latter retaliated with its own claims. For awhile, Samsung took the lead with larger phablet style phones which outsold smaller smartphones for the past few years. Apple stepped up to the game a few months ago with two larger iPhones, the iPhone 6 and iPhone 6 Plus.