Report: Apple, Qualcomm failed in $1B bids to invest in TSMC for chipsets

Apple (NASDAQ:AAPL) and Qualcomm (NASDAQ:QCOM) were each spurned in bids valued at more than $1 billion to invest in Taiwan Semiconductor Manufacturing Co. as part of an effort to get exclusive access to smartphone chipsets, according to a Bloomberg report.

The report, citing unnamed sources, said that the two giants wanted to invest in TSMC so that the chip fabricator would set aside a certain amount of production specifically for them. However, TSMC wants to retain the ability to switch its production between customers and products, the report added, noting that TSMC executives have said they want to retain control of the company and don't need outside cash investment.

Apple and TSMC declined to comment and Qualcomm couldn't be reached for comment, according to Bloomberg

The bids highlight the changing nature of the chipset business, where volumes of devices that need high-powered silicon are increasing and a limited number of companies can produce the chips.

In June, Qualcomm CEO Paul Jacobs left open the possibility that the chipset maker might run its own silicon fabrication plant, or fab, or make use of its cash pile to keep up with demand. However, it is unlikely that Qualcomm will start running a fab any time soon.

Earlier this year Qualcomm reported shortages of its most advanced 28-nanometer chips, used in some high-end smartphones. Jacobs said in June that while supply is improving and Qualcomm may be able to deliver enough silicon to support customers' demands, some smartphones will have to be delayed due to the supply constraints. Qualcomm executives have since said that supply and demand for the chips should balance better by year's end and that company is working with four foundries to try to boost supplies.

For more:
- see this Bloomberg article

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