Richard Cownie (tich.delete@this.pobox.com) on January 29, 2013 6:14 pm wrote:
> bakaneko (nyan.delete@this.hyan.wan) on January 29, 2013 2:18 pm wrote:
>
> > Sorry, I got hotblooded and gave you a wrong
> > answer to a misunderstood question:
> >
> > (there was more in my posts, but meh, too lazy)
>
> Yup, I enjoyed the rant :-)
>
> > The question is why would you replace Intel with
> > a group of ARM based suppliers if the price is
> > the same for similar products?
>
> If we widen the definition of price to "total cost of
> ownership per unit of throughput", then the answer is,
> you wouldn't change. It just seems likely that the
> people who are building low-power quad-core ARM SoC's
> to go into tens of millions of sub-$200 tablets will also
> have a chance at making some neat cheap ultra-dense low-
> power servers.
>
> > Alternatively: why wouldn't they need the high
> > margin (not want, NEED) and could lower the
> > prices?
>
> They wouldn't *need* the kind of margins Intel has because
> a) they have businesses designed to survive on the high
> volumes and razor-thin margins of the smartphone/tablet
> business, b) the ARM ecosystem works by having fab
> expertise developed by foundries, "standard" core designs
> and various other useful IP by ARM plc, a bunch of free
> or cheap software (gcc, linux etc). So the barriers to
> entry are rather low.

The barriers to entry are maybe low (everyone has a shot),
but that doesn't mean you can survive on a bad business
plan.

> > And if they need it, why would they have lower
> > production costs and thus could lower the prices?
>
> They wouldn't have lower production costs. Intel has the
> best fabs; and on top of that the foundries want a profit.
> But most (maybe all) ARM SoC vendors would be willing to live
> with much lower margins than Intel currently gets for server cpus, which
> could translate into lower prices.
>
> I don't believe that Intel is selling server cpu's at the marginal
> cost of production. Do you ?

That's what my question is about.

Is Intel's margin free money which just lies around or not?

--

But maybe it isn't about margins, maybe it is about a more
open industry?

There are many stances which are justified by how much money
you could save, but which are in reality about idealism.
(And most of the time the reasoning is obviously flawed
killing of a maybe otherwise sound idea.)