What's the marginal cost of producing ASIC

[kingcoin]

When Avalon posted their TMSC contract, they didn't fully black out the prices and someone saw they pay around $4k per wafer. They get ~4k chips out of the wafer, and packaging would add less than $1 per chip, so their cost is likely in the $1-2 range. That might have gone down with their recent increase in volume though, who knows.

But how much was the mask cost?

OP says MARGINAL cost.

The mask cost is a major cost which you have to divide by the total volume. For low volumes it will outnumber the wafer cost. The Avalons are using very old technology where the mask cost is pretty low compared to a more recent technology. The software cost is also typically in the multi 100k$ range.

http://en.wikipedia.org/wiki/Marginal_cost

In economics and finance, marginal cost is the change in the total cost that arises when the quantity produced changes by one unit.

They've already paid for the mask. While the number of wafers produced will affect the average cost, it won't affect the marginal cost unless for some reason another set of masks needs to be made.

NRE, development const, tool cost, mask production const, etc. should not be included in the marginal cost per the definition of the term.

However, I wanted to know the mask cost as for a miner these costs will outnumber the unit production cost by large. The volumes for miners, at least at present, is so low in an ASIC context where one usually expect to sell hundreds of thousands or hopefully millions of devices.

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[kingcoin]

Listen to Maqi-something.

This is why electronics are so cheap a year or two after it's released. The real investment is in the development, and when a new generation comes out, that old development is "worthless".

Some years ago you would pay $100 for a 128MB usb-stick. Now you get a 2GB for less than $5.

The fab cost is tremendous. Samsung has recently started production of 10nm NAND flash. They're building (it might even be ready by now) a new fab for mass production of 10nm NAND flash which costs $7 billion.

The 128MB usb-stick you paid $100 for several years ago was made using an old technology in a fab which might even have been closed down by now.

The $5 2GB stick could not even be made using the old technology (unless you used lots of dies or chips making them bulky and power hungry). The feature size have decreased so the density have increased which will fit more devices on a wafer, so each device gets cheaper, if the defects are fairly constant across the wafer the yield in terms of number of devices will go up.