What’s up with... TSMC, Apple, Marvell, VMware, Dell

• TSMC set to increase chip prices
• Apple caves on app commissions
• Data centre and 5G drive Marvell’s growth
• VMware and Dell also report big sales hikes

Chip shop pricing, an Apple settlement and some impressive tech financial reports give us plenty to chew on as we close out the week’s news roundups. 

The global chip shortage has already been hurting lots of companies, but the pain might be about to get worse: TSMC (Taiwan Semiconductor Manufacturing Company), the world’s largest chip producer and a critical supplier to the likes of Apple, AMD, Broadcom, Marvell, NVIDIA and Qualcomm, is about to raise its prices by about 10% for its advanced chips and 20% for less advanced products, according to a Wall Street Journal report reviewed by The Verge. If that happens, it’s going to jack up the costs of TSMC’s customers and have a knock-on effect down the supply chain, with all manner of technology product process potentially edging up. The news comes just as Samsung gears up for a major investment in chip production.  

The TSMC news isn’t Apple’s only concern: It has just conceded to pressure from app developers, which had launched a class action suit against the tech giant, and is introducing new App Store rules that will allow developers to inform customers of how they can purchase direct and so avoid paying Apple’s cut, something they have not bene allowed to do up to now. The Apple press release makes the company sound benevolent, while this Guardian report provides an alternative view that references the $100 million payment Apple needs to make to some developers. 

Chip vendor Marvell Technology reported a 48% year-on-year increase in revenues to $1.08 billion for the three months to 31 July, but also recorded an operating loss of almost $267 million. The company says its dramatic jump in sales is not just down to its $10 billion acquisition of Inphi, which closed earlier this year. "I am pleased that stand-alone Marvell and the acquired Inphi businesses both contributed to our strong year-over-year revenue growth,” noted President and CEO Matt Murphy. “We expect year-over-year revenue growth will accelerate in the third quarter, led by substantial contributions from the cloud data center market. In addition, we expect our 5G business to continue to grow with strong sequential revenue growth in the third quarter, and a significant step up projected in the fourth quarter." Marvell isn’t done with its inorganic growth either, as it announced the $1.1 billion acquisition of Innovium earlier this month. And now, of course, it’s one of the many companies nervously awaiting news from TSMC... Read more. 

VMware continued to ramp up its business in the three months to 30 July, reporting a 9% year-on-year increase in revenues to $3.14 billion, though its operating profit slipped slightly to $525 million. “Our customers are evolving their strategies from a ‘cloud first’ to a ‘cloud smart’ philosophy where they are picking the right clouds and cloud services for the right workload, and turning to a multi-cloud environment,” noted CEO Raghu Raghuram in this press release. 

VMware’s current parent Dell Technologies (which is set to spin off VMware before the end of this year) has also released its latest financials, and they’re not shabby... In the three months to 30 July, Dell generated sales of $26.1 billion, up by 15% year-on-year, while its operating profit of $1.37 billion was a 21% improvement. Like many IT tech giants, Dell has its eyes on growth from telecoms customers, having unveiled its cloud native telecom ecosystem in June. Read more.   

Already set for an in-depth investigation by the UK’s competition authorities, NVIDIA’s planned acquisition of Arm also looks set for a detailed probe by the European Union’s antitrust team when it seeks approval for the deal in the coming weeks, reports Reuters.  

The market for communications platform as a service (CPaaS) services grew at 40% year-on-year during the second quarter of 2021 and is set to be worth $5 billion this year, according to the latest market report from Strategy Analytics. “Today the primary application for CPaaS is consumer-based SMS, providing transactional connectivity between mobile devices and emerging cloud services. We believe the technology is poised to provide significant enhancements to business communications and sophisticated customer service applications, driving this market to the $14B mark by 2025.  We believe we are at the beginning of the CPaaS evolution as sophisticated customer engagement and advanced communications can become the key building blocks of future communication tools” said Fazil Balkaya, Principal Analyst at Synergy Research Group. Twilio is still the clear market leader, accounting for 38% of the market in the second quarter, far ahead of Vonage, which has an 11.8% share. Read more.

- The staff, TelecomTV