Dear Master Malstrom,
Do not expect any price cuts on the Xbone or PS4 like we saw with the
PS3 (which made it viable). It relied on Moore’s law, the two year
cadence of transistor technology shrinks (PS3 90nm -> 65nm -> 45nm Cell
revisions). That just isn’t possible any more; transistor shrinks are
too expensive. The 32nm Cell was cancelled while in development. Even
Intel has put off the next shrink for a year, and the other companies
are slowing their timetables.
The PS4/Xbone chips are made at TSMC or Globalfoundries, and neither has
been keeping up with a two-year schedule. The R&D costs are expected to
exponentially rise for the 20nm, 16nm and 11nm nodes. AMD itself who
designed both CPUs has no public plans for a 20nm chip of any kind.
So when you see the hardcore saying that price cuts will revive sales,
remember they are unlikely to come. If they launch at $400 or $500
that’s the price people will have to accept for 3-4 years.
Interesting email. I’ll remember this one.
I have no idea if you are right or not, but it seems strange to me that they would put out console hardware without the expectation that the components would become cheaper over time.
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