Why Do CPU's Cost So Much?

[stan92]

Hi all im just wondering why CPU's cost so much? Like what parts and procedures make them worth so much?

[WoodenMarker]

http://www.youtube.com/watch?v=KPsgPl37qMY

[Excon]

Its a very delicate process take take expensive equipment to do?

[NinjaStyle013]

Lol, he made a topic about GPUs too...

 

http://linustechtips.com/main/topic/45761-why-do-graphics-cards-cost-a-lot/

[Maskot]

idk, have you ever tried to make trillions of 22nm transistors?

[Godlygamer23]

idk, have you ever tried to make trillions of 22nm transistors?

In Ivy Bridge CPUs, it's more like 1.2 billion per die.

[prolemur]

This guys seems like a major cheapskate! 

[MsTrMind]

In Ivy Bridge CPUs, it's more like 1.2 billion per die.

And they only made one IB cpu?

[leomtg]

If cost is problem and you are on a very very very tight budget.

You should consider a VIA CPU and motherboard.

http://www.ebay.com/itm/VIA-C3VCM6-MINI-ITX-POS-MOTHERBOARD-VIA-C3-1GHZ-CPU-cheap-OFFERS-WELCOME-/120867243893?pt=US_Motherboard_CPU_Combos&hash=item1c243fc775

 

CPU with motherboard and a 256mb RAM module

1 GHz single core CPU, IXT form factor, supports up to 1Gb of DDR333 for just $42!!!

 

Just kidding. But actually I am sad that VIA got killed off by patent problems and poor management. (Also owned by Cher Wang, like hTC) Having more choices is always better for the consumer and just being able to choose from Intel or AMD is getting boring.

[911^NEmeSis]

Expensive to make, expensive to buy.

[TechFan@ic]

http://www.youtube.com/watch?v=KPsgPl37qMY

I recognized the AMD Phenom II quadcore processors from their wafer die-shots, not really sure if that's pathetic or cool.

[stan92]

thankyou everyone, i am not a cheapskape, i simply asked a very logical question..

[WoodenMarker]

I recognized the AMD Phenom II quadcore processors from their wafer die-shots, not really sure if that's pathetic or cool.

It's cool man--real cool. 

[Godlygamer23]

And they only made one IB cpu?

No. But we're talking about why a CPU is "expensive."

[MsTrMind]

No. But we're talking about why a CPU is "expensive."

 

Well, a CPU is expensive because there is currently a Duopoly between AMD and Intel. 

AMD is sooooo much cheaper because they don't have the power most Intel chips deliver.

Believe me when I say that Intel could still make enough money when they sold the 4670k for 150 euro and the 4770k for 170 euro.

But why would they do that? People need powerfull chips...

[Stephie_Girl]

What I find funny is after watching the WAN show the other day from like 2-3 weeks ago, each chip costs the same to make.  Like what happens is the wafers are cut and the ones that have the transistors closer to the center are ran through as I5's and I7's then binned accordingly, where the ones further from the center are tested as I3's, Pentiums and Celerons and then binned accordingly.  So basically the cost to make the chip is the same, so Intel rips us off!!! :(

[MsTrMind]

What I find funny is after watching the WAN show the other day from like 2-3 weeks ago, each chip costs the same to make.  Like what happens is the wafers are cut and the ones that have the transistors closer to the center are ran through as I5's and I7's then binned accordingly, where the ones further from the center are tested as I3's, Pentiums and Celerons and then binned accordingly.  So basically the cost to make the chip is the same, so Intel rips us off!!! :(

Ofcourse they do ...

That is how they make money :-) It is not the production cost (as in from raw component to cpu) that is expensive, it is the whole development behind it :-)

[ProKoN]

Ofcourse they do ...

That is how they make money :-) It is not the production cost (as in from raw component to cpu) that is expensive, it is the whole development behind it :-)

the manufacturing process is extremely expensive.

 

owning a site, a facility, equipment , raw materials cost handling and storage...., trained technical staff, packaging and support...very very very expensive

[MsTrMind]

the manufacturing process is extremely expensive.

 

owning a site, a facility, equipment , raw materials cost handling and storage...., trained technical staff, packaging and support...very very very expensive

Delevelopment would still be more expensive. Months and months of research, trial and error, debugging, ... Paying engineers without knowing if the new chip would be a success...

[wpirobotbuilder]

Ofcourse they do ...

That is how they make money :-) It is not the production cost (as in from raw component to cpu) that is expensive, it is the whole development behind it :-)

 

Yes, silicon wafers are relatively cheap ($40 in 2005, probably similar now), but a single modern fab costs around $6-8 billion to produce (straight from the mouth of Intel's Marketing VP, also here), of which they have built a new one and upgraded others. That's definitely expensive.

 

 

Delevelopment would still be more expensive. Months and months of research, trial and error, debugging, ... Paying engineers without knowing if the new chip would be a success...

 

These figures are Intel's total R&D budget per quarter, so I can't be exact, but since they make much more than just CPUs, I'd guess that the research budget for the time it takes a CPU to come to market is on the same order of magnitude as building and operating the fabs.

[MsTrMind]

Yes, silicon wafers are relatively cheap ($40 in 2005, probably similar now), a single modern fab costs over $6 billion to produce (straight from the mouth of Intel's Marketing VP).

I am really sorry, but I don't know what a "fab" is :-( please, explain.

[ProKoN]

Delevelopment would still be more expensive. Months and months of research, trial and error, debugging, ... Paying engineers without knowing if the new chip would be a success...

R&D certainly is the biggest cost in the whole cycle for sure.

 

i just wanted to point out that the manufacturing process  is still an expensive core component to the cycle.

[speciealpha]

Manufacturing is delicate. Also the cost of building and operating the fabrication plants is enormous. Another huge factor is R&D.

 

Between all of these, there is a pretty narrow margin of profit. 

[speciealpha]

I am really sorry, but I don't know what a "fab" is :-( please, explain.

fabrication plant

[MsTrMind]

R&D certainly is the biggest cost in the whole cycle for sure.

 

i just wanted to point out that the manufacturing process  is still an expensive core component to the cycle.

 

 

Manufacturing is delicate. Also the cost of building and operating the fabrication plants is enormous. Another huge factor is R&D.

 

Between all of these, there is a pretty narrow margin of profit. 

Yeah I know the actuall place (the so called "fab") is expensive to build, but this can be used for a couple of production cycles :-)

 

fabrication plant

Ohhh ok, kind of stupid -_-