Re:TSMC to begin 3nm chip production next month
by jmyeet on Thursday August 18, 2022 @10:45AM
(#32510408)
So I'm critical of Tim Cook because he's just not a leader like Steve Jobs was. This doesn't mean he isn't capable however. Tim Cook has had a massive impact on Apple's success and things like this TSMC deal are more evidence of this.
This began more than 10 years ago when Apple was sitting on a massive pile of cash. What do you do with all that cash? Most companies will simply pay dividends or, more commonly now, do share buybacks (side note: it's become popular to view share buybacks as some kind of systemic problem but they're functionally no different to dividends).
Instead Apple engaged in vendor financing. A lot of components Apple needs requires massive capital investment. Companies might borrow money for this. Apple essentially became the bank, saying we'll give you the money for this. In return Apple gets some combination of preferential pricing, guaranteed availability or exclusivity for a certain period.
Eventually Apple doesn't even need to spend money to do this. Just the commitment for a buyer the size of Apple to purchase your output can have the same effect. It'll help secure financing and Apple can extract the same preferential treatment for that commitment.
This is the logistics side of Apple's business and Tim Cook was the architect of that.
This began more than 10 years ago when Apple was sitting on a massive pile of cash. What do you do with all that cash? Most companies will simply pay dividends or, more commonly now, do share buybacks (side note: it's become popular to view share buybacks as some kind of systemic problem but they're functionally no different to dividends).
Instead Apple engaged in vendor financing. A lot of components Apple needs requires massive capital investment. Companies might borrow money for this. Apple essentially became the bank, saying we'll give you the money for this. In return Apple gets some combination of preferential pricing, guaranteed availability or exclusivity for a certain period.
Eventually Apple doesn't even need to spend money to do this. Just the commitment for a buyer the size of Apple to purchase your output can have the same effect. It'll help secure financing and Apple can extract the same preferential treatment for that commitment.
This is the logistics side of Apple's business and Tim Cook was the architect of that.