The Suppliers Making the iPhone Possible

1 minutes reading time
Published 10 May 2024
Author: Emil Persson
Reviewed by: Kasper Karlsson

It can be argued that Apple's iPhone is the single most influential piece of technology of modern times. The first version was launched in 2007 and has since transformed the way mobile phones are designed, and what consumers have come to expect from their devices. While the iPhone is undoubtedly an Apple product, and the first thing that springs to mind for many when thinking about the company, it has always been reliant on third parties for advanced parts. Join us as we explore how numerous manufacturers collaborate to supply the Integrated Circuits (ICs) that make Apple products a possibility.

Key Insights

  • Collaboration breeds success: The partnerships between suppliers and Apple are mutually beneficial, as both parties are able to do what they are best at. Apple can manufacture its products, while the third-party suppliers can focus on its specific area of expertise.

  • Apple designs some of its ICs: While Apple is reliant on third parties for many of its components, it also has a significant design operation.

  • Why the company is likely to rely on partnerships for many years to come: While Apple is striving towards more and more in-house design, it is more than likely required to rely on third-party suppliers for the foreseeable future.

A Breakdown of the iPhone 15

While we're going to talk more in-depth about the relationship between Apple and various manufacturers, the best way to grasp the scale of collaboration and partnerships that go into making the most complex parts of the iPhone is by visualization. Below is a graphic made by us here at Quartr based on TechInsights' Apple iPhone 15 breakdown:

Key chip suppliers for Apple iPhone 15
The key chip suppliers for iPhone 15

As made evident by the visualization above, the iPhone may be an Apple product, but it is reliant on components from a number of different partners. Companies such as Texas Instruments, Qualcomm, and numerous others supply critical parts required for the iPhone to function.

Apple Designs and Manufactures Components Themselves

However, Apple is not dependent on suppliers for all of its ICs. The company manufactures some of its components themselves. Apple's journey into manufacturing its own internal circuits began with the acquisition of P.A. Semi in 2008, a chip designer that helped Apple develop its first in-house processor, the A4 chip, launched in 2010. This marked a significant shift from relying on third-party suppliers like Samsung for processors. The decision to design its own chips is driven by the desire (and need) to tailor the hardware specifically to the demands of its software and services. The development of these circuits is primarily handled by Apple's hardware technology team, which has grown significantly through strategic hires and acquisitions of companies in the sector.

Apple's processors, known as the A-series chips, are used across a wide range of products, including iPhones, iPads, and the Apple TV. By designing these chips in-house, Apple ensures that the processors are highly optimized for performance and energy efficiency, working well in tandem with the operating systems used in the individual products. The control over chip development also allows Apple to integrate advanced technologies such as artificial intelligence and machine learning directly into its devices, enabling features like facial recognition and augmented reality. In 2020, Apple announced a significant transition for its Mac computers—moving away from Intel processors to its own Apple Silicon M1 chips/processors.

Outsourced Manufacturing and Supply Chain

While Apple designs some chips and processors internally, the manufacturing is, as a rule, outsourced to foundries like Taiwan Semiconductor Manufacturing Company (TSMC). TSMC is a leader in advanced semiconductor technology, and the manufacturing process includes the use of cutting-edge manufacturing processes, so advanced that Apple has no way of feasibly replicating it or building similar manufacturing capabilities in-house. This is however nothing unusual, and a large number of major technology manufacturers rely on TSMC to supply them with components.

Apple is Still Reliant on Third Party Suppliers

While Apple may produce many components themselves, it is simply not enough. As made evident in the visualization previously shown, the company is completely reliant on third parties in order to make its products a reality. The reasons for this are multifaceted but can be broken down into two key reasons.

The first of these is the simple fact that these companies are extremely good at what they do and their expertise in, for example, ICs used to enhance sound or connectivity surpasses what Apple are able to do themselves. The second reason also ties back into the first: it is much cheaper. Instead of hiring designers and building the infrastructure required for these types of ICs, it is much cheaper and easier to simply purchase them from a third party supplier.

Breakdown of Vision Pro - Another Apple Device Made Possible by ICs

While we've been focusing primarily on the iPhone in this article, parts supplied by third parties and through collaboration are utilized broadly across Apple products. A clear example of this is the Vision Pro, in which companies such as Analog Devices and Lattice have been key partners in making the headset possible. However, Apple has still supplied a significant amount of parts themselves:

Key chip suppliers for Apple Vision Pro
Key chip suppliers for Apple Vision Pro

The Birth of Gorilla Glass

While far from as complex as components supplied by companies such as Cirrus Logic and Broadcom, there is one component that has a fascinating story behind it. All Apple products with screens utilize chemically strengthened glass. When the first iPhone was under development, Steve Jobs and his team were on the hunt for a glass that would be able to withstand drops and falls. While doing so they quickly realized that they required something currently not available on the market. Jobs and Apple approached Corning and explained their needs, and luckily enough for them, the glass manufacturer had just the thing they needed. What would later go on to be named Gorilla Glass had been in development for some years, and was ready for mass production roughly at the same time as the iPhone was due to be released. The next steps were relatively obvious, and the beginning of a long and prosperous partnership was born. Today, Gorilla Glass is used in just about every single Apple product, and a majority of smartphones manufactured by other brands.

Mutually Beneficial Partnerships

All in all, the best way to describe the collaboration between suppliers and Apple is as a mutually beneficial partnership. Apple provides business opportunities for the companies that it outsources production to, while they in turn receive the components it needs in order to manufacture their products. The partnership also allows the two sides to do what they do best: the supplier can provide a top-of-the-line component in their specific niche, while Apple can focus on building the best possible product.

Closing Thoughts

Looking at the suppliers for the iPhone and the rest of Apple products, one thing becomes clear: when making such incredibly complex and cutting-edge technology, not even a trillion-dollar company can do it all themselves. The relationships and collaborations that are necessary to make these types of products possible highlight the complexity of modern tech, while also showing how vulnerable it can be. Apple is, for now, reliant on numerous companies in order to make its products possible, but is continually working in order to produce more and more of its ICs themselves. However, due to the complexity (and the cost it would take on by producing it in-house) of many of its components, it is highly unlikely that Apple will be able to produce and supply everything it needs in-house for many years to come, if ever.

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