Samsung, Apple soap opera drama: Korean giant WILL churn out chips for iPhones, iPads

Apple and Samsung have fought bitterly in the courtroom when it came to patents, but the two firms are still prepared to do business: namely the buying and selling of chips.

Earlier this year, Apple reportedly decided to drop Samsung as its manufacturer of A-Series system-on-chip processors used in iPads and iPhones. Instead, Apple, which designs the silicon, gave the supplier contract to Taiwan Semiconductor Manufacturing Company (TSMC).

But on Monday Korea Times reports that Apple has signed a deal with Samsung to supply 80 per cent of its SoC processors, a deal worth billions of dollars to the chaebol.

"Apple has designated Samsung as the primary supplier of its next A-series chips powering iOS devices from 2016 as the alliance with GlobalFoundries enabled Samsung to cut off capacity risk," a source told the newspaper.

The source said the 14nm chips will be produced by Samsung's Chinese fab in Giheung-gu and its US fab in Austin, with Global Foundries producing chips in its New York facility.

TSMC isn't totally out of the running, however, since the source said 20 per cent of Apple's application processors would come from the Taiwanese firm. These will be 16nm chips, compared to the smaller and more power-efficient Samsung processors.

In August, Apple and Samsung called off their long running and extremely expensive patent litigation outside the US.

Signing a major chip deal would make financial sense for both firms, and besides: Samsung is so vast and diverse, the tail cranking out silicon probably doesn't care what the head flogging Android devices is doing. ®