A report says that Apple and Qualcomm were both rejected when they tried to obtain exclusive chip production rights from Taiwanese Semiconductor Manufacturing Company.
Both put forward more than $1 billion in investments so TSMC would pledge production capacity to them, but the manufacturer rebuffed the bid to keep versatile in chip yielding.
The two companies are trying to satisfy the ever growing demand for smartphones, a market estimated to be worth $219.1 billion, according to Bloomberg. Apple could be looking to find an alternate supplier to Samsung, which builds the main chip used in the iPhone and iPad. While Samsung is a major Apple supplier, it is also a major rival in smartphone sales. Qualcomm simply needs to boost supply, as shortages as beginning to limit earnings for the company.
As a supplier to Qualcomm, Broadcom Corp. (BRCM), Nvidia Corp. (NVDA) and other companies, TSMC would like to keep the flexibility to be able to switch back and forth between customers and products. However, TSMC Chairman Morris Chang told investors last month that he was willing to devote one or even two factories to a single customer.
There have been false reports regarding Apple and TSMC in the past. There is a possibility that Qualcomm and Apple may have been actually wanting to deal for baseband chips, which Qualcomm makes with Apple. With the new iPhone release approaching, Apple may be trying to ramp up baseband chip production.