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As an outsider, dealing with Apple as a vendor strikes me as dealing with the mafia: once they've set their sights on you, they'll make you an offer you can't r

As an outsider, dealing with Apple as a vendor strikes me as dealing with the mafia: once they've set their sights on you, they'll make you an offer you can't refuse. Should you accept, they'll give you a shot of capital in the arm and you'll grow faster than you ever could have to meet their schedules. Soon, your engineers are tied up in daily afternoon stand-ups to go over the latest data with Apple's engineers, and they're dictating your R&D schedule. Your company is effectively dependent upon Apple because investors expect revenue growth. Inevitably, however, they'll discard you when a cheaper competitor comes along, or they decide to take the work in-house. Should you refuse, they'll poach away your employees, or enable your competitors to do the same. I haven't thought of a scenario where a vendor can actually rebuff Apple and stay intact.

klelatti 5y ago
Has any of this happened to TSMC? Are they now the most valuable semiconductor manufacturer? Which is not to excuse some of Apple’s less moral behaviour.
- georgeburdell 5y ago
  It's been covered in the media that TSMC loans its employees to Apple. You can also tell that Apple's fingerprints are on TSMC's leading edge node processes because products using it clock lower and consume lower power than comparable Intel processes. Also, to my knowledge, TSMC doesn't particularly stand out in semiconductor sub-fields where Apple doesn't play, such as III-V, embedded memory, and photonics. They are definitely at risk of getting disrupted in these areas.
  - klelatti 5y ago
    Apple is the biggest TSMC customer. I would be astonished if Apple doesn’t influence TSMC’s R&D, product focus etc. But to characterise Apple as somehow abusing their relationship with TSMC as a result of what you’ve said is not right. It’s just a normal commercial relationship between a customer and a large supplier. Also bear in mind that TSMC has a large number of mobile SoC customers - maybe they think that’s their strength and focus on that rather than say photonics. Seems to be working!

klelatti 5y ago

Has any of this happened to TSMC? Are they now the most valuable semiconductor manufacturer? Which is not to excuse some of Apple’s less moral behaviour.

georgeburdell 5y ago
It's been covered in the media that TSMC loans its employees to Apple. You can also tell that Apple's fingerprints are on TSMC's leading edge node processes because products using it clock lower and consume lower power than comparable Intel processes. Also, to my knowledge, TSMC doesn't particularly stand out in semiconductor sub-fields where Apple doesn't play, such as III-V, embedded memory, and photonics. They are definitely at risk of getting disrupted in these areas.
- klelatti 5y ago
  Apple is the biggest TSMC customer. I would be astonished if Apple doesn’t influence TSMC’s R&D, product focus etc. But to characterise Apple as somehow abusing their relationship with TSMC as a result of what you’ve said is not right. It’s just a normal commercial relationship between a customer and a large supplier. Also bear in mind that TSMC has a large number of mobile SoC customers - maybe they think that’s their strength and focus on that rather than say photonics. Seems to be working!