| Squilliam said: Note1: The cost of the motherboard is very steep. This is the cost total cost for a fresh mainboard with everything attached. Cost scaling since then silicon components: GDDR3: Unlike the PS3 - the Xbox 360 uses commodity memory, so the costs for this have likely halved in the last two years. GDDR3 is used extensively. The 8 512 mbit chips are still being used in mass production for desktop GPUs. CPU: Die size has halved. 50% smaller = 50% cheaper if you take into account heat sink cost reductions offsetting the fact that the testing/packaging costs do not scale and assuming a similar yield which is reasonable. GPU: Costs would have more than halved assuming the same scaling. They are integrating into one chips where there was once two. So the reduction in testing/packaging/manufacturing/heatsink costs are quite significant. Also it removes an important point of failure so the reliability/suport costs would be far lower. Motherboard: The power supply components on these motherboards are expensive. A typical desktop motherboard has to supply only a CPU as GPUs come with their own power regulation circuitry. An Xbox 360 motherboard is much more complicated than your standard motherboard as it contains the ram/gpu/cpu all on the same board- these changes reduce that complexity. Cost scalings. If everything else remains the same except the motherboard costs are halved then according to the above table the Xbox 360 Arcade would cost $180 to manufacture and the 60gb would cost $230 to manufacture. If the motherboard cost was reduced by 33% then the Arcade would cost $210 and the 60gb would cost $260. I would pick the 50% reduction in cost because theres still shipping/retailer expense etc to add to it. |
I know the various iSupply attempts at breakdown of the costs. This table is very intersting for those who have insight into the industry because it gives the right numbers for total production costs (at the time of writing), but the manufacturing cost breakdowns are sometimes utterly wrong in the table. I will only point out a few details on the table (I have insight into many of the points listed in the table and I roughly know the real world difference in the manufacturing costs but for obvious reasons cannot disclose where I got my information from). Let's take the line Enclosure/Hardware, by which iSupply probably counts the plastic casing, screws and cables. Now the real world manufacturing costs for the casing for the PS3 are approximately $2, add a few screws and a cable and we are at $2.50 manufacturing costs max. (Also note that iSupply has an additional generic "Manufacturing costs" line. $39 is at least day pay for a chinese worker slave, and we are not assuming that a chinese worker slave manufactures a lonely PS3 a day....).
Your ideas of power supply costs (and iSupplys ideas) are a bit odd. Of course a PC power supply circuitry is a lot more expensive than one for a console. First of all, a PC regulator circuitry has to handle a lot more power input/output than a console (usually solved with multiple phases designs), it also has to handle it to be programmable (after all, you can set the voltage for your CPU in the BIOS of the PC, I don't think any console does that). Nonethless, we are essentially talking about n times (2 power fets, 1 inductor, 2 capacitors) + no controler chip, so depending on quality we are talking $10-$15 for a console power supply. (Obviously an XBox power supply is slightly more expensive than a PS3 ps because it uses an external brick).
Another common misconception is the cost savings on the CPU and GPU. Usually there are two reasons why these components get smaller. One is a clean redesign that saves transistors (a difficult but sometimes profitable task, as a high-end GPU, for example, may contain several tens of millions transistors just to keep it operational..) More obvious, a die shrink is achieved by going to a new smaller process line, like 65nm -> 45nm. Now mathematically, this shrink will half your costs as the smaller die uses half the area for the same design (provided you can actually do that which, as many engineers have found out the hard way, is not really true). In the real world, you get about 30% savings with a die shrink. And somebody has to fork out a cool $1billion for the new 45nm fab first. If you think that your manufacturer simply tells Sony/MS/whoever: "Hey, we just build a new $1billion 45nm fab so now you pay only half the costs for the 45nm part compared to 65nm parts", then you are up for an ugly surprise).
Ram and HD prices are obviously a little tricky to determine, as they are mainly dependent on how many you order and the delivery due date. For the harddisk, you pay about $21 for a 40G harddidsk under optimum conditions. (Actually, 40G units are no longer offered by manufacturers, due to rising manufacturing costs. They were around $20 for 40,60,80G units but have risen above the $21. So manufactureres had to either increase the prices (and you can be sure at least one manufacturer will not do it to try and gain market share) or simply drop the lowest capacity model. This is the simple reason why the PS3 now comes with a 80G drive, it has nothing to do whatsoever with a Sony exec suddenly having the enlightement that "80G is what consumers want, not 40G"). Memory costs for the PS3 are a bit higher than for the XBox since it uses only 4 GDDR rams but 4 XDR rams which carry a higher patent charge, but again we are talking cents so the real memory price difference is only determined by amount and delivery due date.
Now the ultimate question is why does iSupply get the right numbers for the wrong reasons, so to speak. This has to do with the subtle (or not so sutle) difference between manufacturing costs and production costs which would be the theme of an entirely different article..
