Apple to use TSMC’s next 3-nm chip tech in iPhones and Macs next year

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Apple aims to be the first company to use an updated version of Taiwan Semiconductor Manufacturing Co.’s latest chip manufacturing technology next year, with plans to adopt it in some iPhones and Macs, sources familiar with the matter told Nikkei Asia.

The A17 mobile processor currently in development will be mass-produced using TSMC’s N3E chipmaking technology, and is expected to be available in the second half of next year, according to three people familiar with the matter. They said the A17 will be used as the premium entry in the iPhone lineup due for release in 2023.

N3E is an upgraded version of TSMC’s existing 3-nanometer production technology, which only came into use this year. Two sources added that Apple’s next generation of the M3 chip for its Mac offerings is also set to use the upgraded 3nm technology.

The nanometer size refers to the distance between the transistors on a chip. The fewer the number, the more transistors can be squeezed onto a chip, making it more powerful but also more difficult and expensive to produce.

TSMC said at a recent technology seminar in Hsinchu, Taiwan, that the N3E will offer better performance and energy efficiency compared to the first version of the technology. Industry sources said the upgraded production technology is also designed to be more cost-effective than its predecessor.

This article is from Nikkei Asia, a global publication with a uniquely Asian perspective on politics, economics, business and international affairs. Our reporters and outside commentators from around the world share their views on Asia, while our Asia300 section provides in-depth coverage of 300 of the largest and fastest growing listed companies from 11 economies outside Japan.

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As TSMC’s largest customer and largest driver of new semiconductor technologies, Apple remains its most loyal partner when it comes to embracing the latest chip technology. Nikkei Asia previously reported that the US tech giant will be the first to use TSMC’s first generation of 3nm technology, using it in some upcoming iPads.

Previously, Intel told TSMC it wanted to secure 3nm production by this year or early next year to be among the first wave of adopters like Apple, but it has since delayed its orders until at least 2024, three people told Nikkei Asia.

However, 2023 could mark the second year in a row that Apple has used TSMC’s most advanced chip-making technology for only a portion of its iPhone lineup. In 2022, the premium iPhone 14 Pro lineup adopted only the latest A16 core processor, which was produced by TSMC’s 4nm process technologies, which is currently the most advanced. The standard iPhone 14 lineup uses the older A15, which was used in the iPhone 13 and iPhone 13 Pro models released in the second half of 2021.

Meanwhile, the race is underway among chip makers to come up with more advanced production technologies. Both TSMC and Samsung hope to be the first to introduce 3nm technology into mass production this year. This technology is suitable for all types of central and graphic processors of smartphones, computers, servers, as well as those used in artificial intelligence computing.

In the meantime, Apple will likely use different levels of production technology to introduce larger differences between its premium and non-premium models, according to Dylan Patel, senior analyst at SemiAnalysis. Previously the biggest differences were in screens and cameras, but this can be expanded to include processors and memory chips, he said.

According to the analyst’s estimation, there is a cost increase of at least 40 percent for the same area of ​​silicon when moving to 3nm chips from the 5nm family, which includes 4nm chips.

TSMC, Intel and Apple declined to comment.

A copy of this article First published by Nikkei Asia on September 14, 2022. © 2022 Nikkei Inc. all rights are save

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