How much does it cost to physically produce a video card such as the Geforce 3?

[erikiksaz]

I'm just wondering, does it really cost more than 400 dollars to produce a next-gen video card? i remember that someone told me the actual production price is very very low. is this true?

 

[Ausm]

I think in parts and manufacturing not even close...it is R and D which eats up the cost

Ausm

 

[arod]

It is far less than $400 per card but it is also higher than you think. You pay for the engineers to design and test the chipset. The people that get the supplies needed for production (boards, fans, memory etc.) You pay for the production plant to make the cards, the list goes on but it is still far less than $400/card

 

[Zach]

Marketing also takes a good chunk I bet.

Also, paying programmers is a huge chunk. Ongoing cost of driver updates!

 

[sitka]

My guess is 12 Million Dollars. This would be the costs from a starting point of the successful Geforce2 platform and utilizing that knowledge base till launch of Geforce3

 

[glen]

I will guess $1,000,000,000 from start to finish.

 

[zippy]

The actual video card- not taking R&D, the fab plant, the engineers, the programmers, etc. into account- it really isn't all that much. If it was $400 a card, do you really think all these sites would be getting one for review?

 

[chuckieland]

not to mention that navida make % of money, then sell to another manufactory such as asus or creative, they make % of money and sell to large disputer that make % and sell to varies of wholesalers, and wholesales also make % of money and sell to retailer. the retailer make % of money and sell to end user(which is you)
say that they each make on average 20%
that is 100% markup already
not to mention that it cost shipping for them too, rule of thumb with business is that shipping cost around 10% of the order. that is another 50% markup
so you looking at 150% markup
also it's new card, they always sell higher.
i did say it cost less then $100us to make them

 

[dutchboy]

I think that it takes more than you think to make the actual cards. The 64/128mb of 4ns ddr sdram can't be that cheap, considering how much the slower 266Mhz is now. I'm not saying that they aren't overcharging us, but that it should be in perspective

 

[erikiksaz]

well, i guess paying 600 dollars for next-gen technology isn't all that bad. at least i know they're not TOTALLY ripping us consumers off. it sure does hurt the wallet though.

 

[chuckieland]

guy remember you buy those memory at retail price
they buy it at large quantity price
let say, you pay $100 for ddr 64mb
it could only cost $20 from manufactory.

 

[Wingznut]

"it is R and D which eats up the cost"

ausm hit the nail on the head.

 

[pm]

Leaving out R&D, my guess:

the GPU: approx. $70 - this based on the large die, and the fact that they don't own their own fab (overhead) and includes the package, testing, the package and package yield loss (assembled die that don't pass once packaged).

the memory: hard to guess since I don't know the FSB (150MHz? 200MHz?), but probably somewhere on the order of $40 in bulk for 64MB.

The card and the other components: probably a 6 layer PCB, plenty of caps, a heatsink & fan, resistors, other chips. my guess $18

packaging: $2

Total cost: ~$130

That's my guess, anyway. I have a feeling it's on the high side, but I'd bet money that the assembled card is over $100, and I'm sure that the bulk of the cost is in the GPU.

 

[MikeyP]

pm, I guess the RAM would be a little more expensive than that. This is 4ns DDR memory, so if you wanted to know the "bus" speed, it would be 250Mhz DDR.

 

[bigshooter]

You aren't buying ram like you would from mushkin though. They buy actualy chips, not fully packaged ready to work in a mobo ones, so they will cost even less.

 

[Degenerate]

I suppoes the gpu would cost a lot more to design than make.

 

[Mykex]

I dont think you can answer that question till you sell the cards. Accounting for all the equipment to actually do the manufacturing should be an astronomical amount and can only be depretiated after selling volumes of the card.

Or you can look at it this way the first card costs 30 million each one after around 40$.

Edit: Oh and just to play with the numbers above at that guesstimate they would need to sell 53,333.3r units @600.ea before they started to show a profit.

 

[Zucchini]

Yup, depends on how many your gonna make If you set out to make just one hahahaha that would be one #@% expensive card

 

[PlatinumGold]

LOL

You guys are funny.

Let me pose a question. How many Geforce 3 cards do you estimate Nvidia will sell at their premium price? This should give you a pretty good estimate to the initial investment for this chip (R&D costs, any fab plants they built, etc). afterwords they lower the price, at which point anything above the cost to build it is profit.

I'm guessing they will sell 200,000 of these at premium price (you figure they are getting 150 for each) so you it comes out to 30,000,000.

their cost to keep building would is probably around $15.00 a piece.

 

[kami]

Uhh...do you remember how expensive the GTS was when it first came out? Now look at how cheap it is...I can buy one for $250 Canadian (I remember when they were $600 here). And you know what? they're still making profit (and probably quite a bit). So no, they don't need to be charging us this much. nVidia is just milking us... wait a few months and it'll drop.

 

[rommel]

mmm...bout two fity..yeah...bout that...lol

 

[440sixpack]

Well, let's see...

Jen-Hsun has stated that they will get "up to $45" for the NV2A and the MCPX from MSFT. This of course is just the chips.

R&D for the fiscal year ending 1/28/01 was $86,438,000. This covers the whole product line of course.

You also have to factor in the yield they are getting from the wafers. Lower yield = higher price.

Memory, PCB and components, testing, packaging, etc. well frankly I'm not sure about those.

 

[Noriaki]

<< I'm just wondering, does it really cost more than 400 dollars to produce a next-gen video card? i remember that someone told me the actual production price is very very low. is this true? >>

Depends how you define production price. If you just talk actual materials and the price TMSC charges nVidia to produce the chips and the cost to attach it to the board then yes it's much less than $400. I'd say in the $100-$200 range for materials and manufacturing. But that's really not a very reasonable way to consider the price.

TMSC has to make a profit for physically producing the chip (this will be covered in their cost to nVidia)
nVidia has to make a profit for it as well.
And so does the end retailer (Asus, Hercules, Creative, etc)

Then there are marketting costs from nVidia and the retailers to consider, and there are nVidia's R&amp;D costs.

It's been pointed out that after they cover R&amp;D costs and marketting costs and stop marketting them, then it can drop in price quite a bit because they only have to cover the profit points.

 

[SXMP]

someone said marketing? what kind of marketing?! nvidia vid card marketing is relativly small compared to most other components and companies. you might see in a magazine once in a while, powered by nvidia. the only other thing is there website. o well my 2 cents.