Why do Xeon processors cost so much?

[Kwad Guy]

So what's the deal on Xeon processors? Why do they
cost SO much more than their standard Pentium
counterparts? And why are the PIII Xeons SO much
more than the PIIs...

For example, a PIII 550Mhz 512Kb Xeon goes for about
$800-900, while the standard PIII 550Mhz goes for about
$130...

I know there's more onboard cache, but is this simply
a case of "small market, high price", or is there some
reason the Xeon actually costs so much more to build.

Also, is a PIII Xeon processor THAT much better than
a PII? I see PIII Xeons 550s (512 Kb) processors for about
$800-900, but a PII 450 (512Kb or even 1Mb) can be
found in the $100-150 range...

Kwad

 

[Sunner]

The most obvious price raiser is that they use fullspeed cache.
On the older ones the cache is external, and finding 1 MB of 500 MHz capable SRAM's isnt exactly cheap.
Also, they have a more expensive package, though this doesnt affect the price nearly qas much as the cache does.

And also, like you said, they're sold to a market where price isnt the top priority, so Intel knows they can charge a bit extra.

As for if they're better, that depends, in Quake they're no better than any P2/3, while in a database envoirment, that extra and faster cache can make a HUGE difference, especially in heavy SMP envoirments.

Another difference between Xeons and regular P2/3's is that the Xeons have a 36 bit memory address bus, as opposed to the 32 bit bus on the regular P2/3's, this allows them to address more memory(64 GB vs 4 GB).

And finally, change the MB's in your post to KB's, and the GB's to MB's, while CPU's with GB's of cache will probabaly show up some day, we arent quite there yet

 

[Electric Amish]

Yeah, it's all that cache.

That's the most expensive part of the processor and the XEON's got a ton of it.

amish

 

[vi edit]

I've read several articles (sorry, I can't provide the links) that have stated that cache is relatively inexpesive. I remember reading numerous technical articles about this when the original cache'less celeron came out 3 or 4 years ago.

IMHO, it really is just a marketing ploy made by Intel to sell their high end products.

Think about it - They always release their top end cpu's in the $700-$1200 range, when you can go two or three lower processors and get it for a quarter of the price. You get 80% of the speed for 25% of the price.

Example is the P3 1 gig vs P3 800. The 1 gig goes for like $750 while the 800 goes for $250. If you look at the benchmarks, you'll see a fairly negligible difference in benchmarks.

It's just marketing.

 

[Idontcare]

I have some experience in the manufacturing of CPUs and I can tell you the market price has absolutely nothing to do with the manufacturing cost (to a point). I worked in a fab (one of many for this particular corporation) in which if we sold a CPU for $3 we broke even and covered all our expenses but did not turn a profit.

We sold those CPUs for $100 to a company, which in turn resold them as $3000 components in $20,000 machines.

The point is the market price was independent of the manufacturing cost. If you do the math you will find that if Intel sold their PIII for more than $5 apiece they will make money on their semiconductors. They may lose money overall for R&D and marketing but the point is the cost of manufacturing a P3 is relatively low.

So what determines the price of a XEON? Come on people, it is always the same answer - THE MARKET DOES.

FYI

 

[Train]

mainly because they are aimed at servers, and people who buy servers usually buy with other peoples money, therefore, dont care as much

 

[Midnight Rambler]

Extra cache costs more to produce, whether it's external L2 or, as in the case of the latest Xeons, I believe it is integrated just like the P!!!. And in that case, we're talking about adding millions of transistors to the CPU's total count, perhaps even doubling the total number of transistors. As such, it must surely be more difficult to produce, and thus warrants a higher price. Plus, as others noted, the server market is a high price arena anyways, and relatively speaking, the Xeon is a fairly low cost solution to them.

 

[Whitedog]

There's only one reason they cost so much... INTEL
All the crap about that extra cache and it running at CPU speed does bring the price up a bit, but NO Where near what they are charging.

It's all supply and demand.

It's simple, they're server chips, Therefore, the only people that buy these things, HAVE to have them, so Intel can charge whatever they want for them...

Things will change once some of the other companies have better server platforms.

AMD is supposed to have something within a year I think...

 

[Whitedog]

Oh, to prove my point, Go to pricewatch and look up a PIII 733 and XEON 733

PIII = $173
XEON = $500

Now, both of these chips are identical as far as core and cache...

Only difference is one of them is on a Slot 2 card and can be used on XEON boards..

So if you think it costs them THAT much more to produce.. Bzzzzzt!

 

[Idontcare]

The L2 cache is not integrated on the XEON unless you are talking about the 256KB Coppermine XEONs. If you have a 512KB, 1MB, or 2MB Xeon then the L2 cache chips (there will be more than one) will be on a seperate die. The separate cache die is also manufactured by Intel. As far as total transisitor count goes, it is off the chart. The Xeon has about 7 million transitiors for logic (i.e. the P6 core), that 1 MB of L2 cache contains about 84 million transitors. But the cpu itself (which is a sperate die if you are concerned about yields) has only around 9 million transistors.

 

[Kwad Guy]

Hi WhiteDog:

For further comparison, look at the price of a
Xeon PIII 700Mhz with 1mb onboard cache. Retail price on this
chip is around $2200...(You can find a couple of OEM versions
for about $1500). By comparison, as you noted, the PIII 733Mhz
with 256kb onboard cache (same as standard non Xeon Coppermine)
goes for about $500. So that additional onboard cache is
(apparently) very expensive. Of course, it could be expensive
only because Intel can charge more for it...

Kwad

 

[Sunner]

Ask Sun, they know all about demand vs price
We bought a 450 MHz CPU from them for ~8000$ a little while back, of course all computer hardware is expensive here in Sweden, but Sun stuff is expensive everywhere

 

[Idontcare]

So they've raised their price from $3000 to $8000 did they...

 

[Midnight Rambler]

Obviously some people's logic is blinded by their hate for Intel ... wait till you see what AMD will charge for their server chips.

 

[Whitedog]

PIII Xeon 700 with 2MB on-die Cache? Cool. This is a new chip I haven't heard about "until now"

Yea, well, $2200.. hehe

All this crap about it having 1 billion transistors making them cost so much.. LMAO. Oook.

 

[Sunner]

FYI, depends, that was one with 4 MB cache, those are quite a bit more expensive than the ones with 2 megs of cache, and also like I said, all computer hardware costs a fortune herea 32 MB GTS costs like $350 for the cheapest ones.