Recap 1 Cost and Trends in Cost Cost

Recap 1

Cost and Trends in Cost • Cost is an important factor in the design of any computer system (except may be supercomputers) • Cost: amount spent by manufacturer to produce a finished good • Cost changes over time – The learning curve – High volume products lowers manufacturing costs (Double the volume will decrease the cost by 10%) – Commodity products decreases cost as well • Commodities: identical products sold by many vendors in large volumes (keyboards, DRAMs) – low cost because of high volume and competition among suppliers 2

Processor Prices 3

Memory Prices 4

Trends in Cost: The Price of Pentium 4 and Pentium. M 5

Wafer, Die, IC http: //www. intel. com/museum/online/funfacts. htm Wafer Processing F F F F F F F F ng ci i l S IC Die F Packaging F 6

Cost of Integrated Circuits Dingwall’s Equation 7

Explanations Second term in “Dies per wafer” corrects for the rectangular dies near the periphery of round wafers “Die yield” assumes a simple empirical model: defects are randomly distributed over the wafer, and yield is inversely proportional to the complexity of the fabrication process (indicated by a) a=3 -4 for modern processes implies that cost of die is proportional to (Die area)4 8

Yield Manufacturing Defects 13/16 working chips 81. 25% yield 1/4 working chips 25. 0% yield 9

Yield (2) Assuming $250 per wafer: $5. 92 per die $58. 82 per die 52 die, 81. 25% yield 42. 25 working parts / wafer 17 die, 25. 0% yield 4. 25 working parts / wafer 10

Where Do The Transistors Go? • Logic contributes a (vanishingly) small fraction of the number of transistors • Memory (mostly on-chip cache) is the biggest fraction • Computing is free, communication is expensive 11

Cost of Computers What is Relationship of Cost to Price? List Price Average Discount 25~40% ASP Component Cost 100% Gross Margin 45~65% Gross Margin Direct Cost 20~22% Direct Cost 10~11% Component Cost 72~80% Component Cost 25~44% +(25~40)% +(82~186)% 34~39% 6~8% Component 15~33% Cost +(33~66)% 12

Component Cost vs. System Price • Increase CPU cost by $100 • Then – Direct costs go up by ~$20 – Indirect costs go up by ~$40 – Discount goes up by ~$50 • List price of the system is now $210 up – Then, if fewer get sold because of this, indirect costs go up… • Relationship is very complex 13

Cost and Price • A $1000 increase in cost may result in a $3000 increase in price – hence, important to understand the relationship • The relationship is complex – for example, a company may under-price a product that has heavy competition and over-price a product that has no competition 14

Contribution of IC Costs to Total System Cost Subsystem Fraction of total cost Cabinet: sheet metal, plastic, power supply, fans, cables, nuts, bolts, manuals, shipping box 6% Processor 22% DRAM 5% Video card 5% Motherboard 5% Processor board subtotal 37% Keyboard and mouse 3% Monitor 19% Hard disk (20 GB) 9% DVD drive 6% I/O devices subtotal 37% Software (OS + Office) 20% 15

Desktop Prices Vendor Model Processor Clock speed MHz Price Compaq Presario 7000 AMD Athlon 1, 400 $2, 091 Dell Precision 420 Intel Pentium III 1, 000 $3, 834 Dell Precision 530 Intel Pentium 4 1, 700 $4, 175 HP Workstation c 3600 PA 8600 552 $12, 631 IBM RS 6000 44 P/170 IBM III-2 450 $13, 889 Sunblade 100 Ultra. SPARC II-e 500 $2, 950 Sunblade 1000 Ultra. SPARC III 750 $9, 950 All systems have similar configurations – price variations due to expandability, expensive disks/memory/processor/OS, commoditization 16

Server Prices System CPUs Price IBM x. Series 370 c/s 280 Pentium III $15. 5 M Compaq Alpha. Server GS 320 32 Alpha 21264 $10. 3 M Fujitsu PRIMEPOWER 20000 48 SPARC 64 GP $9. 7 M IBM p. Series 680 7017 -S 85 24 IBM RS 64 -IV $7. 5 M HP 9000 Enterprise Server 48 HP PA-RISC 8600 $8. 5 M IBM i. Series 400 840 -2420 24 i. Series 400 Model 840 $8. 4 M Dell Power. Edge 6400 3 Pentium III $131 K IBM x. Series 250 c/s 4 Pentium III $297 K Compaq Proliant ML 570 4 Pentium III $375 K HP Net. Server LH 6000 6 Pentium III $373 K NEC Express 5800/180 8 Pentium III $683 K HP 9000/L 2000 4 PA-RISC 8500 $368 K 17