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From: ForthNet@willett.pgh.pa.us (ForthNet articles from GEnie)
Newsgroups: comp.lang.forth
Subject: Forth Engines / Harris
Message-ID: <2078.UUL1.3#5129@willett.pgh.pa.us>
Date: 9 Dec 90 23:33:28 GMT
Organization: String, Scotch tape, and Paperclips.  (in Pgh, PA)
Lines: 56

Category 6,  Topic 15
Message 215       Sun Dec 09, 1990
F.SERGEANT [Frank]           at 14:55 CST
 
 PK> The sad fact is that Harris can't sell an RTX for $15
 .
 Phil, I don't know what you mean when you say that.  Do you mean that  they
can't do so and make a profit?  Or, do mean no one would be  willing to
purchase it at that price?
 .
 I believe you mean the former.  In that case, do you mean their  marginal
cost per chip exceeds $15?  Or do you mean their all-in costs  including
amortizing all of the start up, development, engineering,  technical writing,
and the air-condititioning bills for the previously  larger staff would exceed
$15 per chip?  I contend that at most only  the marginal costs should be
considered now.  Consider the rest gone.   Now they can get into the uP market
"for free." 
 .
 I think I understand your point about 2 micron vs 1 micron.  If so,  they can
lose a little on each chip until they can convert to 1 micron.   If the demand
isn't there at $15 then they don't lose much 'cause they  don't sell many
pieces. If the demand IS there, then they convert to  the profitable 1 micron.

 .
 Of course I don't know enough about the semiconductor business.   Doesn't
Harris own the entire former RCA semiconductor facilities?  And  the
GE/Intersil facilities?  Maybe I'm wrong, but it seems to me that  among that
conglomeration there ought to be the ability to make an  already designed and
debugged uP so it CAN be sold profitably for $15.
 .
 Part of my point is that I doubt the $33 for PLCCs in 1000s comes  close to
making them a profit if the project closes down as they will  never recover
their up front costs.  But $15 in singles that lets the  project continue
could well make a profit year after year.
 .
 Of course the $15 is out of thin air.  $12?  $19.57?  Take your pick.   I
HOPE they keep/obtain enough customers that it does continue,  regardless of
their pricing strategy.  We won't know for sure if my  plan would work unless
they try it.  What if they'd done it a year ago  as an offensive move? 
 .
 The way it looks to me now is they are planning to sell the RTX as a  low
volume specialty item at a specialty price.  If so, maybe it will  carry on
year after year and pay for itself (all its development having  been written
off as a loss).  I think with the low pricing I suggested  it could have been
turned into a high volume item and paid off all its  development costs.  I
even see that as a remote possibility now (I'm  ever the optimist).
 .
 I want to make it clear that I'm not asserting that anything I've said  is
correct.  I have no details at all of Harris's specific  circumstances,
pressures, plans, and goals.  I'm merely speculating.   So, please continue to
fill in any details you can about how the  semiconductor industry works, etc.
 .
  -- Frank
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