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To: Elmer Phud who wrote (138155)	10/29/2004 4:57:11 PM
From: EpiWan	Respond to of 275872

300mm wafer cost $2500 Dothan yield 612 gdpw - assuming yields as good as AMD's!Die cost $4.085 packaging $10.00 (to make Joe happy) Test $0.915 Total Cost $15.00 Having more fab space than God: Priceless Oh, but not free. Their marginal costs may be $15 per part but their fixed costs are huge, and while lower prices will boost sales, there's only so much the market will soak up. So it doesn't matter that their variable costs are low, because their fixed costs are so high.

To: Elmer Phud who wrote (138155)	10/29/2004 5:34:00 PM
From: pgerassi	Read Replies (1) \| Respond to of 275872

Ephud: 1) Intel does not sell a majority of Dothans. So why did you use those as an example? 2) How do you know Dothan yields anyway? 3) Are you using "line" yields you disparaged instead of saleable bin yields? 4) Did you forget to process the wafers? 5) As Prescotts and Celerons are Intel's highest selling lines, why didn't you use them? 6) Did you include the percentage of PIB CPU sales and include that packaging, HSFs and document costs as well? 7) Having the die sitting at the fab doesn't get it to the place it needs to be sold from. Did you include shipping costs? The answers to the above are because it was the smallest, you gave it the best number you could find, yes because it made my number come out the way I wanted, yes, they were too big, no and no. I could use your justifications and say that to produce 1 more Dothan, I need a $2,500 wafer, $1,000 of processing, $100 to cut the wafer into dies, $1.80 to test for a good working 1.4GHz Dothan, $10 to package that die, $1 to ship it to the assembly plant and to the US, $2.5 for the 1/2 HSF as half the sales are in PIBs, $5 for the box, carrier and documentation. Result the next Dothan costs $2,620.30. That is as too high as yours is too low. Of course that Dothan won't sell for $150, but who cares? You don't. Pete