Samsung And TSMC To Jointly Produce Apple’s ‘A8’ Chips: Report

Apple (NASDAQ:AAPL) and Samsung (KRX:005935) will go hand in hand once again for the production of a next-generation processor named the “A8,” a new report said on Sunday, adding that the majority of the production would still be handled by the Taiwan Semiconductor Manufacturing Co., or TSMC (NYSE:TSM).

Apple Insider cited a report from The Korea Economic Daily, which claimed that the iPhone-maker had placed an order with its South Korean rival to produce 30 percent to 40 percent of the new A8 system-on-a-chip, or SoC, that would likely power the 2014 models of the iOS devices.

Sources told the Korean publication that Apple was having difficulties with the production of the advanced 20-nanometer chip, which ultimately forced the company to turn to Samsung.

According to a report by DigiTimes in June, Apple and TSMC had secured a three-year deal under which the latter and its integrated circuit design service partner Global UniChip would manufacture new A-series chips for future iPhones, iPads and iPod touch devices. The report also claimed that the manufacturing process of the 20-nanometer "A8" chips was scheduled to begin in July 2013, while production was expected to ramp up only after December.

The Apple Insider report mentioned earlier also referred to a job fair, held by TSMC in New York in July, which sparked rumors that the company could open a facility in the city.

Samsung has been the manufacturer of Apple A-series processors ever since the first-generation iPhone was released in 2007. The company also produced the new A7 chip found in the new iPhone 5s. However, recent reports suggested that Apple's 2014 iPhone model, possibly branded the iPhone 6, would feature a TSMC-built processor.

Although Apple has reportedly been trying to limit its dependency on Samsung, the South Korean smartphone-maker is one of few manufacturers that can produce the superior components that Apple demands for its devices.