As mobile devices replace personal computers in many homes and workplaces, chip manufacturers are repositioning themselves to focus on wireless technologies. Intel is investing $2 billion in the first foundry built for the production of chips cut from 450mm wafers. The chip giant’s goal is to lower its production costs to better compete with ARM in the market for mobile processors. Meanwhile Samsung is investing $4 billion to turn a Texas plant that makes memory chips into a mobile chip foundry, and pure-play foundries that compete with Samsung are benefitting from the Korean giant’s competition with Apple in the smartphone and tablet markets.
According to IHS iSuppli, pure-play semiconductor foundries will see 21% revenue growth this year, thanks largely to Apple’s decision to shift business to dedicated foundries and away from Samsung. Samsung is one of the world’s largest chipmakers, and for years it has manufactured the microprocessors designed by Apple for its iPhones and iPads. Samsung is an integrated device manufacturer (IDM), meaning that it also designs chipsets.
“Apple already has its own designs and does not need an IDM for its chips to be made, so it can just as easily move its semiconductors to a foundry,” according to IHS iSuppli. “However, Apple’s anticipated shift is also the result of its well-publicized tiffs with Samsung over patent infringements on both makers’ smartphones that have strained relationships between the two,” according to Len Jelinek, the firm’s chief analyst for semiconductor manufacturing.
While Apple is clearly shifting a significant part of its semiconductor business away from Samsung, the iPhone maker is apparently finding it hard to completely end the relationship. Earlier this summer reports surfaced in Korea claiming that Apple’s upcoming A9 processor will in fact be made by Samsung.
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