[ppml] too many variables

[Ted Mittelstaedt]

> -----Original Message-----
> From: vijay gill [mailto:vgill at vijaygill.com]
> Sent: Friday, August 10, 2007 11:42 AM
> To: Ted Mittelstaedt
> Cc: John Paul Morrison; ppml at arin.net; nanog at nanog.org
> Subject: Re: [ppml] too many variables


> I knew reading nanog was a bad idea. However, now that I am well and truly
in the weeds,
> might as well go forth.
> The phrase that I think I am looking for is.... it's coming to me...almost
there.... ah yes
> amortization specifically amortization...units sold... cost basis...
something something.

Which has nothing to do with what I was saying.  And, nothing to do
with what you said initially - which was testing.

An embedded system vendor can go out right now and start a brand new design
that will be ready for sale in 3 years from now.

They can use a beta CPU that isn't for sale now.

They can use a new CPU that costs $150 per

Or they can use a 4 year old CPU that costs $50 per

They know in 3 years the beta CPU will be new, and will cost
about $200 per

They know in 3 years the new CPU now will be 3 years old and will
cost about $100 per

In 3 years from now the 4 year old CPU will be 7 years old and will
cost about $20 per

The cost to design and develop the product with all the sheet metal
and controllers and everything else is going to be about the same.
And as you point out quantity sold dictates price.

But adding an extra $100 to $200 to the cost of a $5000 item to allow
the designers to select a CPU that is 4-5 years newer is very
possible.

Using commodity controller parts instead of special-ordering everything
or having it built-to-spec is also very possible.

The problem is attitude - the embedded systems people are beancounters
and if they can save $50 on a part that would go into a $5000 list
item, even when that additional $50 would tremendously improve the
power of the device, they will do it.

As someone else pointed out, the customers aren't demanding CPU
power in routers, so the router vendors aren't focusing on that.
But when the customers do start demanding it, the router vendors
will not have any problem providing it.

Ted