Meta is approaching Samsung to lower its chip dependency on TSMC

Meta has significant investments in both extended reality and artificial intelligence. Because of this, the corporation requires sophisticated processors, which are only made by a small number of companies worldwide. All IT businesses go toward TSMC because it is one of the top makers, but Samsung is also making a name for itself in this industry.

Companies who wish to lessen their reliance on a single supplier for all of their chips might benefit from Samsung’s dual-sourcing strategy, which allows for supply chain diversification and lower procurement costs. That’s exactly the part Samsung is supposed to play for Meta.

If businesses are looking for an alternative to TSMC, Samsung is a good choice. Meta Recently, CEO Mark Zuckerberg made his first trip to South Korea in more than ten years. He spoke with Yoon Suk Yeol, the president of South Korea, about a variety of subjects of shared interest. Zuckerberg emphasized that one of the main areas of cooperation between the two businesses was Samsung’s position as a significant foundry.

According to reports, the CEO of Meta discussed how his company’s reliance on TSMC for chips is growing and called the situation “volatile.” According to a top presidential office official who spoke with local media, Zuckerberg’s comments imply that Meta wishes to spread its risk in the current geopolitical environment by having Samsung manufacture part of its AI and XR chips as well.

The president of the nation emphasized that Samsung’s efforts in chip manufacturing, notably the establishment of the largest semiconductor cluster in the world close to Seoul, have the backing of the government. It indicates to Meta that the government of the nation supports the semiconductor sector and that businesses that want to lessen their dependency on TSMC will be able to find willing partners in both Samsung and the South Korean government.

While in Korea, Zuckerberg also had a meeting with Lee Jae-yong, the chairman of Samsung Electronics. Although there was no formal handout given, stories imply that the two probably discussed the possibility of producing AI chips.