TSMC Founder Reveals Why Apple Chose Them Over Intel as Custom Chip Supplier

TSMC founder Morris Chang has revealed that Apple CEO Tim Cook rejected Intel as an iPhone chip manufacturing partner in 2011, and told him that "Intel just does not know how to be a foundry."

In a new YouTube interview with Acquired, Chang recounts how Apple briefly paused discussions with TSMC in February 2011 when Intel's CEO approached Cook about manufacturing Apple's iPhone chips. At the time, Intel was already supplying processors for Apple's Mac lineup.

Despite the existing relationship, Cook ultimately chose TSMC over Intel after just two months of consideration. According to Chang, Cook's decisive comment about Intel's foundry capabilities came during a private meeting at Apple's headquarters in March 2011.

"I wasn't too worried," Chang said, explaining that TSMC had advantages over Intel in manufacturing capabilities and customer trust. "I knew a lot of Intel's customers in Taiwan, and none of them liked Intel. Intel always acted like they were the only guy for microprocessors."

Chang said that TSMC's success was built on its responsive approach to customer needs. "When the customer asks a lot of things, we have learned to respond to every request," he explained. "Some of them were crazy, some of them were irrational, but we respond to each request courteously. Intel has never done that."

The decision proved pivotal for both companies. TSMC went on to become Apple's exclusive chip manufacturer, producing all Apple silicon chips, including those for iPhone, iPad, and Mac.

Meanwhile, Intel's foundry business struggled for years to gain traction with external customers. Only recently did the company revamp its manufacturing strategy with the establishment of Intel Foundry, set up to produce integrated circuits for external clients. In September 2024, for example, Intel's foundry business secured Amazon’s AWS cloud services unit as a customer for custom AI chips.