In the golden age of motherboards there were dozens of manufacturers and profit margins were nice and healthy. Manufacturers could differentiate themselves based on performance, quality and features. The CPU folks had a different plan in mind. AMD and Intel have been on the road to integration for the past two decades and the motherboard manufacturers have largely suffered because of it.

When the memory controller was in the chipset and there were 3 or 4 competitors in the chipset space, motherboards actually performed differently. These days the memory controllers are integrated onto the CPU die and performance is as high as possible. SATA, audio, ethernet and USB are all either fully integrated into chipsets or only require a small support chip on the motherboard itself. Within the next decade or so these features will move onto the CPU die as well.

My first 430VX motherboard that eventually spawned into AnandTech set me (actually my parents, I was 14) back around $130. Prices haven’t really changed, yet the expectations from end users have gone up. Granted there’s this new ultra high end market that didn’t really exist back then, but the majority of motherboards sold have far more features and don’t cost much more than what they used to.

The pressure is on the motherboard makers to deliver affordable P55 solutions. Without affordable motherboards, Lynnfield will fail - so Intel and end users are both expecting a healthy supply of ~$100 motherboards. As I’m about to show you, doing so is quite difficult.

This is the LGA-1156 socket:

The socket itself costs a couple of dollars, but even that is significantly more than LGA-775. The motherboard makers I spoke with pegged the LGA-775 socket at well under $1 per socket. The bulk of the 1156 socket isn’t the cost of the device, but rather the licensing fee that has to be paid to Intel for each socket. I’ve heard numbers approaching $7 per socket, per board once you include the licensing fees. As volumes go up, the price per socket will go down, but for smaller manufacturers this is a tough pill to swallow. It’s far easier to build an expensive motherboard than it is to build a cheaper one.

Intel realizes this and helps the manufacturers with rebates and marketing assistance. So the license fee ultimately may be lower for some makers but getting specifics on this is impossible. Worries of lawsuits abound :)


Click to Enlarge

For the most part the motherboard makers look at the socket and associated licensing fees as part of the chipset cost. Despite Intel moving the north bridge and memory controller on die, Ibex Peak, otherwise known as the P55 PCH is no cheaper than P45:

Chipset Price
Intel X58 IOH $70
Intel P55 PCH $40
Intel P45 MCH $40
Intel ICH10R $3

 

If you start at $40 for the motherboard, you’ll need to add another $10 for a 6-layer PCB. A 6-layer PCB is necessary if you want to run SLI at this point, otherwise you can get by with a cheaper $5 4-layer PCB. Mentioning SLI also requires validation and support from NVIDIA. That’s $30,000 up front plus an average of $5 per motherboard.

  Low End Mid Range High End
P55 PCH $40 $40 $40
NVIDIA SLI License $5 $5 $5
6 Layer PCB $10 $10 $10
Audio Codec $2 $2 $2
PCIe Gigabit LAN $3.50 $3.50 $7.00
Power Delivery Circuits $12 $16 $23 - $55
Misc PCB Components $8 $12 $15
Heatsinks $6 $10 $25
Labor/Overhead $9 $10 $24
Logistics/Sales $9.50 $13 $18
Total Cost $105 $121.50 $201

 

An audio codec and Gigabit ethernet will together set you back about $5. Figure more for more expensive codecs and another $3.50 if you want dual GigE ports.

P55 motherboards will have a range of 4 to 24-phase power delivery circuitry. Each phase costs about $2 in components although the high end motherboards with high quality MOSFETs/chokes/capacitors will reach $3 per phase for the digital solutions. If we look at Gigabyte’s 24-phase UD6 that would be about $48 just in power delivery circuitry for the motherboard without volume discounts.

The power connectors, switches, LEDs, I/O back panel and other components on the motherboard cost anywhere between $8 and $15 depending on the type of motherboard. Figure $8 for an entry level micro-ATX board and $15 for the highest end boards with slots and ports aplenty.

What about those fancy copper heatpipes and elaborate heatsinks? They start at $6 and go as high as $25 for the really high end motherboards with high-content copper blocks and pipes.

Then there’s assembly, labor and overhead in testing and producing the motherboard. You can count on about 10% of total material cost for an entry level board, 12% for midrange and 15%+ for the high end boards. The lower the volume the higher the overhead; the more testing required, the higher the overhead as well (gotta make sure those $250 boards work right).

The final costs are related to packaging, sales and actually getting the boards to distributors. Figure about 10% per board on average.

All of this roughly adds up to a low end board costing $105 without worrying about profits. It's only through rebates or very large scale manufacturing that a motherboard maker can even come close to making a profit on an entry-level board. Mid range boards are a bit easier to make but my mid range estimates are definitely on the lower end of the spectrum. For the high end you're looking at raw costs over $200, but at those price points it's far easier to turn a profit.

While we'll definitely see P55 motherboards hit the $100 price point, it's worth realizing how difficult that is to do. As P55 matures, these costs will fall (particularly the chipset) but initially it's going to be a tough race to the bottom.

POST A COMMENT

54 Comments

View All Comments

  • strikeback03 - Monday, August 24, 2009 - link

    Cheaper, apparently, as Intel charges for other components to make use of the integrated GbE. That is the rumor at least Reply
  • imaheadcase - Friday, August 21, 2009 - link

    The cost varies for the heatsink portion are pretty extreme, $25 on the chart for high end is 2nd most expensive component.


    I highly suspect this is not the actual case though. So many ways to cool with passive heatsinks. Some use copper, aluminum, or mix of both. Or none for that matter.

    Whatever happened to that awesome technology people was raving around cooling in the chips themselves with "mini fans" that would never wear out? :P
    Reply
  • Wwhat - Saturday, September 5, 2009 - link

    Metals are expensive and shot up like crazy when he economic crisis got on its way, and by increased demand by the growing industry in burgeoning nations so it makes sense they can cost a lot, especially copper. Reply
  • buzznut - Friday, August 21, 2009 - link

    This is a great article. I've never really thought in depth about how much all the little components cost. I guess I thought that all these companies that build tech are making tons of profit on everything they sell. The licensing comes as a bit of a surprise too.

    It looks similar to the situation where game console manufacturers lose money on hardware sales to make it back in software sales.

    How do motherbaord makers stay in business? Do they all have to diversify?
    Reply
  • mcnabney - Friday, August 21, 2009 - link

    When I saw the heatsink prices labeled as $6-25 I rolled my eyes and started looking for the comments section. yeah, little bit of aluminum or copper that cost a dime to fabricate add 6-25 to the price. Yeah. Reply
  • PrinceGaz - Saturday, August 22, 2009 - link

    That was my first thought too, and I still agree entirely with you. $6-25 for a few bits of aluminium (near the $6 end) or copper with a heatpipe or two for the chipset sink (towards the $20 end). That's madness.

    You could buy those sort of sinks in a high street store for less than that, so mobo manufacturers buying them wholesale in the tens or hundreds of thousands (most of the cheap sinks will be used across the whole mobo range they manufacture, regardless of chipset) will cost a fraction of that. I reckon less than $2 at the low end, $5 mid-range, and at most $15 at the very high-end.
    Reply
  • Rajinder Gill - Friday, August 21, 2009 - link

    The motherboard vendors don't fabricate the heatsinks in house, they commission a thrid party to do the work. I'd imagine running costs add up at that end too. Why would anyone want to sell at cost?

    Reply
  • mindless1 - Friday, August 21, 2009 - link

    Regardless, except for the fancy ones I too question the $6 to 25 figure. I don't buy high-end boards but frankly do not think any board I have ever bought had $10 cost added from the heatsinks. $6 "maybe" but even this I doubt due to the reuse of same sink on several boards so there was high volume.

    You can get a chipset 'sink one piece at a time shipped halfway around the world for $3 total. I figure $1 for a typical northbridge on a low end board, 50 cents each for the mosfet 'sinks if it has any, another 50 cent for SB.

    http://www.dealextreme.com/details.dx/sku.13614">http://www.dealextreme.com/details.dx/sku.13614

    When a heatsink manufacturer is doing nothing but making 'sinks, the running costs are fairly well absorbed and their greatest concern is to stay as close to max capacity as possible instead idle factories.
    Reply
  • mcnabney - Friday, August 21, 2009 - link

    You guys really aren't getting to the cold fact that little bits of metal, simple chips, and rudimentary electronics are amazingly cheap when purchased OEM or wholesale in Asia. Seriously.
    Retail accessories and parts are ludicrously marked up.
    Reply
  • Rajinder Gill - Saturday, August 22, 2009 - link

    My point is that some of the elaborate ones do not cost the vendors a mere couple of cents to commission. DFI and ThermalRight are one example. I think I was told by DFI they were costing them in excess of $15 a piece. $25 is a little high for sure (worst case scenario perhaps?). I think there are plenty of sloppy examples out there that are cheap, but not all of them (if any) cost a only few cents unless you're just thinking about the cost of the metal.

    later


    Reply

Log in

Don't have an account? Sign up now