[readitalready]

They really need to build their own fabs at this point. AI is going to kill their ASIC and DRAM supply chain if they don't.

"Real men have fabs." - Jerry Sanders, first CEO of AMD.

Actually, AMD, Nvidia, and Apple need to build their own fabs. Maybe Google, Amazon, and Meta too.

[dangus]

“They need their own fabs” is a very current events-biased read of the situation.

You can easily end up like AMD or Intel spending years with your own fab that’s uncompetitive.

One of the best things that ever happened to AMD was spinning off their fabs.

Intel only recently righted their ship after spending years with fabs that couldn’t keep up with competition, and even Panther Lake still contains some TSMC silicon.

The AI boom is inevitably not going to last forever. Either demand will subside or production will increase. High prices in tech rarely stick around.

[readitalready]

You can easily end up like AMD or Intel spending years with your own fab that’s uncompetitive.

You could.

Or you could have no fab and no supply of chips for your business.

[dangus]

Being short on chips means you can raise prices.

Making chips on an uncompetitive lithographic process means your chips are worth less.

[readitalready]

No, you CAN'T raise prices because no one will buy them, destroying your brand and your business. And you won't have supply anyways.

There is no scenario where not having a fab is beneficial.

Apple will have to build their own fabs, whether they like it or not. And they will need to make it competitive if they want to stay in business.

[danaris]

> There is no scenario where not having a fab is beneficial.

Mmm, I think that's an overly strong statement.

In the scenario where Apple has a fab that's doing work at a 2030 level in 2030, that's great, especially if everyone else is, by their standards, doing work at a 2025 level. In the scenario where Apple's fab is doing work at a 2030 level in 2035, and another fab is doing work at a 2035 level, owning their own fab has suddenly become a liability. If they had used that money to hire the output of other fabs, then as soon as it became clear that another one was eclipsing the one they were using, they could simply switch. And given the way businesses operate, it would be very hard to justify closing down their own fab to use the one that was outperforming it.

Now, granted, that's not an especially likely scenario, but it is a very realistic one.

[JKCalhoun]

Yeah, one of those two bad scenarios sinks a corporation the other is a tax write off.

[kushalpandya]

Perhaps something that Ternus can add to his legacy-building exercise, given that he led hardware.

[trueno]

I always wonder if this is a possibility. They've worked so closely with TSMC that they've many times over the decade bankrolled R&D and equipment that TSMC uses. I would be super interested to know if that relationship has left them enough know-how of the fab process to someday control their destiny there, that would actually be pretty insane.

[dangus]

Apple almost certainly has entire production lines at TSMC that they effectively own. I don’t really think bringing chip fabrication in-house has any immediate benefit for them.

We can observe with Apple’s pricing staying stable that they have some of the best supplier arrangements in the industry.

[readitalready]

Apple doesn't own TSMC. TSMC is putting Apple in the back burner in favor of Nvidia and other high margin companies.

They are literally being limited by TSMC (as well as the DRAM makers) because they don't have their own fabs.

[seanmcdirmid]

It isn’t that simple: Apple made strategic investments in TSMC, and actually fronted the money for many of the fabs making their chips.

[kilroy123]

Especially outside of Taiwan.