Apple ditches Samsung chip manufacturing as the feud continues

It looks like the battle between Apple and Samsung is heating up even more.  Apple has previously dropped hints that they were looking to recruit other manufacturers to create chips for their mobile devices.  It seems that the company has now tapped Taiwanese company TSMC to manufacture a trial run of processors.

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Reuters talked with Fubon Securities analyst William Wang who indicated that Apple is looking to diversify though they are not likely to move all of their chip business away from Samsung.

"I think TSMC will get the new chip orders, the issue however is allocation. Apple won't give the whole 100 percent to TSMC. Maybe it'll allocate only 20-30 percent."

Until now Samsung has been the sole manufacturer for Apple's A5 chip, used in the iPad2.  The current design of the A5 belongs to Apple and not Samsung, so changes could be made as to who the manufacturer is.  It's very likely the new chip will not be called the A6 though.

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The question is if Apple is not looking to give all chip orders over to TSMC, does that mean there will be two different processors in future mobil devices?  It seems really unlikely that Apple would allow Samsung to manufacture the A6 and simultaneously have TSMC put out a different chip.

A more likely overall solution is that TSMC gets all chip orders for the new processor but Apple keeps Samsung on board for NAND memory.  Samsung is the world's largest supplier of that type of memory, holding approximately 35.6 percent of the market share.  Even though Samsung and Apple are battling it out over the design of their mobile devices, neither company is in a position to completely sever ties.

Reuters is reporting that no one (TSMC, Apple, or Samsung) wants to make a comment on this situation.  More details will likely emerge soon enough.

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