Ultrabook vendors unhappy with Intel’s pricing

Want a much bigger discount than the 20% Intel is offering.

Intel logo 63x58 Ultrabook vendors unhappy with Intel’s pricing

A number of Ultrabook manufacturers in Taiwan that SemiAccurate has spoken to have voiced displeasure with Intel’s pricing scheme for processors.  The sources want to remain anonymous as they can only discuss Intel list prices and not discounts and marketing incentives.

Intel is offering the manufacturers a 20% discount, but the manufacturers are looking for around 50% citing the fact that the processor is by far the most expensive component in any computer.

Let’s start by looking at a table PC. If you buy from Intel you have to pay $75 for an Atom processor and an additional $20 for the chipset. This compares very unfavorably to, say a Tegra 2 from NVIDIA that sells for around $20.

If we look at Ultrabooks then the processors get very expensive. Core i7-2677 sells for $317, Core i7-2637 for $289 and Core i5-2557 for US$250 – and that is after the 20% discount.

This pricing assures Intel a margin of around 60% and agreeing to reduce the prices will not only erode margins right now, but probably also in the future.

What the manufacturers are really waiting for is AMD to step up and come with an interesting offering at the right price – and with the right feature set that in this case also includes USB 3.0.S|A

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