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Intel's Per-Chip Cost Averages $40
Fedorpheux writes "According to a report by the analysts at In-Stat, Intel's average cost per chip is about $40. These same chips, such as the Pentium 4s, can cost consumers up to $637. This $40 average cost has remained rather steady since 2003. This cost does not include money spent on marketing or development, but it does explain how Intel can continue its profits even in this era of quickly dropping prices in computer hardware."
> I would actually think that their margins are lower than AMD's,
And from what defective braincell did that thought come from?
It's always been assumed that Intel's manufacturing is MUCH better than AMD's, meaning the actual product is much cheaper to make. And traditionally AMD could only sell chips by discounting them significantly below the Intel equivalent. And the result is that, financially, AMD's has been on life-support for years. The numbers are right out in the open -- AMD makes diddly/squat per chip sold compared to Intel.
Frankly, Intel could have crushed AMD like the bug they are many times (now may not one of them), but hasn't primarily because they want to stay on the right side of anti-trust law.
I can understand why everyone likes AMD's chips, but are you buying their stock?
Whenever I hear the word 'Innovation', I reach for my pistol.
but that's the chip maker's own decision to make, not a "required" one.
Well not nessacerily, first Intel is a publicly traded company, so they are required to maximize profits. Secondly intel is in some Hot Water for monopolistic practices and all of a sudden cutting prices to $50 a chip will not help them win their case. Third most companies don't want to start a price cutting war which could kill the industry, Intel Sells at $50 and AMD will have to sell at $45 etc.. and the winner will be the one who makes the cheapest chip, aka Not good for consumers. Also there is the issue of Bulk sales, to be competitive Intel will need to offer very good prices for bulk sales of chips say to a Dell or Apple, they want to incorage people buying these chips at bulk vs. 5 at a time for the home White Box manufacturer.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.