“Now it makes complete sense to dedicate a whole fab to just one customer and hold that – to hold fabs in fact to just one customer, ” Morris Chang, CEO of TSMC, told his Q2 results meeting, ” there are customers that are getting bigger and bigger. So it makes sense that we dedicate a whole fab or even more than a whole fab to just one customer.”
The most likely customers for a dedicated fab are Apple and Qualcomm. Both have hinted at looking for alternative business models for securing supplies, but have kept very quit about their plans.
Apple must be thinking: ‘Our biggest rival is Samsung. Samsung has leading edge fab. We don’t, and problems with 28nm have shown that we can’t guarantee finding a source of leading edge fab.’
Apple stuck with 40nm when it felt it couldn’t rely on getting enough product at 28nm.
Apple also knows it could get massive aid from Uncle Sam if it decided to build its own fab in the USA. The US administration is super-keen to lead the way back to on-shore US manufacturing.
Which may be why Morris Chang, whose interests lie very much in keeping the fab industry off-shore for US companies, is proposing the one company dedicated fab model.
As Intel has demonstrated, it is easier to stay ahead of the game in manufacturing when you only build one product in a fab. Intel only makes x86 processors. TSMC has to make multiple products for hundreds of customers. So dedicated fabs for one company at TSMC could turn out to be running more advanced processes than the fabs for multiple customers.
Which won’t please the multiple customers.