Apple is reportedly teaming up with Taiwan Semiconductor Manufacturing Co. (TSMC) to make the A5 chip for the iPad and that poses a big risk for Samsung’s processor business.

The EE Times reported how Apple and TSMC have entered an expanded chip manufacturing agreement. It’s a bit unclear what this TSMC deal means for Samsung’s chip business, but the diversification adds up. In fact, analysts have been talking about an Apple-TSMC partnership throughout February.

In late January, TSMC executives outlined plans to ramp capital expenses in 2011 on an earnings call. That spending meant that TSMC was allocating foundry capacity to a big customer. Rumors quickly turned into reports in the Asian press.

Stifel Nicolaus analyst Patrick Ho said in a February research report:

According to media reports coming out of Asia, TSMC is ready to become a supplier of Apple processors for its iPad and iPhone products. In our view, this is not a major surprise and if anything supports some of the capex TSMC is projected to spend in 2011.

Our checks indicated that TSMC had already been a small second source supplier of the A4 as Samsung was strapped for capacity for all of 2010 and remains constrained today (although much less so). While some have stated that Apple was wary of giving additional business to Samsung (given Samsung’s own release of its tablet and smartphone products), our checks suggest some of Apple’s concerns were more related to TSMC process technology (which had some significant issues at the 40/45nm node) and TSMC’s ability to qualify for Apple. We believe many of these issues have been resolved as TSMC begins to migrate to 28nm.

Ho said that TSMC has been chasing the Apple processor business for at least 18 months. TSMC’s move to add capacity is for Apple primarily.

TSMC CEO Dr. Morris Chang said on TSMC’s fourth quarter conference call in January that the company was going to double its R&D spending for 2011 in a bid to take mobile market share.

Chang said:

As Fabless companies tend to participate more in the fast-growing new markets and designs and new products, such as the mobile computing devices, their faster growth fuels TSMC’s growth. The development and popularity of the mobile computing devices will speed up the technology migration of the leading nodes, such as 40, 28, 20 nanometers, in order to meet the processing speed and low power requirements.

If you go by Apple CEO Steve Jobs’ recent press conferences, it’s obvious that the company isn’t too keen on being Samsung’s largest customer.

During Apple’s antennagate press conference, Jobs said:

“I guess it’s just human nature, when you see someone get successful you just want to tear it down. I see it happening with Google. Google is a great company. Look at everything they’ve created. Would you prefer if we were Korean companies? Do you not like the fact that we’re an American company leading the world right here?

And then Jobs openly mocked Samsung during the iPad 2 launch.

Theoretically, Samsung could decide that it wants to squeeze Apple on chips to supply its own tablet components. Given the dollars at stake, Samsung wouldn’t send Apple packing, but there’s a remote risk there.

Now consider the case for TSMC. Apple partners with TSMC, hurts rival Samsung and has a relationship with a manufacturer that has no skin in the tablet game. The Apple-TSMC partnership is just good business.

This is a guest post from Larry Dignan, Editor in Chief of ZDNet, TechRepublic’s sister site. You can follow Larry on his ZDNet blog Between the Lines (or subscribe to the RSS feed).