Re: spare and upgrade CPUs, other parts of the server that Intel makes, like NICs, ethernet controller chips, some chipsets and mobos. Intel is the #1 producer of NIC cards now, you know, and most servers probably have 2.
Intel certainly makes some additional money on spares (though it's not earth shaking) and a little more on chipsets. The networking stuff loses money according to the income statement.
Motherboards, like chipsets, make some money, but the margins are an order of magnitude less than the margins on server CPUs. It's one thing to sell $1 million worth of CPUs that cost $0.1 million to produce. It's something else to sell $1 million dollars worth of network cards, and motherboards that cost $700,000 to produce.
Your comment is certainly a good one, but Mary's implication was that some large portion of the $60 Billion server market is CPUs with super high margins, and that's the notion I think should be re-examined.
Dan |
