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Forums - Microsoft - Former AMD exec: Xbox One APU project worth over $3 billion

tres on 28 May 2013
MoHasanie said:
Wow that's expensive! MS must be confident the Xbox One will sell loads. I wonder if they are overconfident?


well they didnt think they would get their ass handed to them by the mass public (mostly bashing from a jubilant psfb crowd) for all the stupid stuff that would come out of their own mouths.



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maximrace on 28 May 2013

That's around 30$/ console



g911turbo on 28 May 2013
kowenicki said:

why cant people understand this? Its basic.

it doesn't mean ms paid $3bn or owes $3bn

it means the deal to provide it could be worth $3bn to the company.

it is entirely dependent on sales of the new consoles.

 

The deal is valued at 3bn over multiple years.

This.



Soleron on 28 May 2013
zarx said:
Birimbau said:

cell = 500 million dollars

 

It's hard to believe, because 1,2 TFLOP is so underwhelming for 3 billion...


It was $400m but the CELL was just a CPU tho, and that was just the R&D budget not including the licensing costs over the life of the console. An APU with CPU and GPU (and custom memory system with ESRAM, etc) plus licensing over the life of the console is of course going to cost a lot more than just R&D of a CPU. 

The expensive part was the factories (fabs) Sony owned to produce it. They were expecting higher chip yields (less failed ones) and higher volumes (more PS3s sold) to make back the investment.



Soleron on 28 May 2013
kowenicki said:

why cant people understand this? Its basic.

it doesn't mean ms paid $3bn or owes $3bn

it means the deal to provide it could be worth $3bn to the company.

it is entirely dependent on sales of the new consoles.

 

The deal is valued at 3bn over multiple years.

Yes. They probably project 70m consoles for that number as well, good luck reaching that this gen.

$3bn isn't the difference between AMD staying afloat and AMD defaulting either. It's a finite and mostly known amount of cash now so it cannot increase the value of the company either.



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g911turbo on 28 May 2013
Soleron said:
kowenicki said:

why cant people understand this? Its basic.

it doesn't mean ms paid $3bn or owes $3bn

it means the deal to provide it could be worth $3bn to the company.

it is entirely dependent on sales of the new consoles.

 

The deal is valued at 3bn over multiple years.

Yes. They probably project 70m consoles for that number as well, good luck reaching that this gen.

$3bn isn't the difference between AMD staying afloat and AMD defaulting either. It's a finite and mostly known amount of cash now so it cannot increase the value of the company either.

True.  But at the end of the day closing this deal vs. not was a good thing for AMD revenue.  I have a funny feeling that margins are slim upfront however.



Pemalite on 28 May 2013
g911turbo said:

True.  But at the end of the day closing this deal vs. not was a good thing for AMD revenue.  I have a funny feeling that margins are slim upfront however.


Yeah the margins would be slim, then again it's not like the CPU/GPU was built from scratch, AMD already had the technology at it's disposal, so it shouldn't have been cost prohibitive from an R&D perspective.

Plus, the APU's in the PS4 and Xbox One are pretty monolothic from a die-size perspective, so they won't exactly be cheap to manufacture either, $3 Billion is really a drop in the bucket for something that's going to be produced for a decade for a company of AMD's size.




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mii-gamer on 28 May 2013
kowenicki said:

why cant people understand this? Its basic.

it doesn't mean ms paid $3bn or owes $3bn

it means the deal to provide it could be worth $3bn to the company.

it is entirely dependent on sales of the new consoles.

 

The deal is valued at 3bn over multiple years.


thanks, this makes sense now



Soleron on 28 May 2013
Pemalite said:
g911turbo said:

True.  But at the end of the day closing this deal vs. not was a good thing for AMD revenue.  I have a funny feeling that margins are slim upfront however.


Yeah the margins would be slim, then again it's not like the CPU/GPU was built from scratch, AMD already had the technology at it's disposal, so it shouldn't have been cost prohibitive from an R&D perspective.

Plus, the APU's in the PS4 and Xbox One are pretty monolothic from a die-size perspective, so they won't exactly be cheap to manufacture either, $3 Billion is really a drop in the bucket for something that's going to be produced for a decade for a company of AMD's size.

AMD doesn't manufacture the chip.



Hynad on 28 May 2013
kowenicki said:

why cant people understand this? Its basic.

it doesn't mean ms paid $3bn or owes $3bn

it means the deal to provide it could be worth $3bn to the company.

it is entirely dependent on sales of the new consoles.

 

The deal is valued at 3bn over multiple years.


Thanks you. I really couldn't bother pointing it out and was hoping someone would do it instead. Wondering how long it would take, or how far the comments would go about those assumptions that MS actually paid $3b for the development of the tech that is inside the XBO... Funny thoughts.