Cell Hits 45nm, PS3 Price Drop Likely to Follow

Septimus writes "At this weeks ISSCC, IBM announced that the Cell CPU used in the PlayStation 3 will soon make the transition to IBM's next-gen 45nm high-k process. 'The 45nm Cell will use about 40 percent less power than its 65nm predecessor, and its die area will be reduced by 34 percent. The greatly reduced power budget will cut down on the amount of active cooling required by the console, which in turn will make it cheaper to produce and more reliable (this means fewer warrantied returns). Also affecting Sony's per-unit cost is the reduction in overall die size. A smaller die means a smaller, cheaper package; it also means that yields will be better and that each chip will cost less overall.'"

Pricedrop?

[DrXym]

A price drop would be nice (though the PS3 is now competitive), but the more interesting bit is when is the PS3 slim going to appear. All the pieces are in place for a slim. Sony have been aggressively shrinking the motherboard in the PS3, and the chip size has dropped from 90nm, to 65nm and now 45nm. All that means less power (smaller PSU) and less heat (less fans & heatsinks). There have been other announcements such as thinner blu ray reader headers. It can only be a matter of time before a slim and I think it will hit before the holidays this year. I think it will sell by the shitload too when it does appear. The question is will we see a slim 360 to compete with it? I think there must be a lot of empty space in the 360 too.

Smaller die also means more die per wafer

[exley]

Which is another important factor in bringing the price down. Percentage-wise with more die per wafer yields may go up as well; but in the end yields will be dependent on other things such as how good IBM is with its 45nm process.

Also affecting Sony's per-unit cost

[TubeSteak]

Is the fact they've dropped hardware PS2 emulation.

Re:Effect on cost

[McNihil]

You would be correct if Xbox 360 nor Wii didn't exist. Prices will certainly drop or the units will be packed with more of other kind of technology (PVR) for the same price.

Re:Why would Sony drop the price?

[Cheeko]

Since when is PS3 gaining market share? every months NPD numbers that I've seen show a fairly consistant ratio of PS3360wii, with the ratio within any given month fluctuating based on game releases. 360 had big Sept, November, wii and 360 had a big december, etc.

While the PS3 is selling more units year over year so are its competitors. I'm pretty sure its market share is within a few percentage points (at best) of where it was at 6 months ago. Maybe gained a little from the price drop, but since the price drop the ratios have been pretty steady, with spikes going to the other 2 systems (mostly for Halo, Mass Effect and Mario Galaxy).

The PS3 is doing decent, but its not like its on the glorious rise to market domination. I suspect the next important move will be whether Sony wants to go after market share or profit. If they prefer 1, they will pass on the savings to the customers and lower the price (which MS and Nintendo may or may not counter, as they both actually make a profit on each system sold), or keep the larger (or all) portion of the cost savings to increase their margin per unit.

My personal guess is that they will continue happily selling them at the current price, maintaining fixed share until such time as they have a big exclusive to push. Between then and now they pocket any savings to help their bottom line, then later they can drop the price to help push units around an exclusive. They try dropping the price now and MS will just counter, meaning no major share change. Might as well help recoup your investment while you can, if its not going to hurt you, since your gain at the moment is minimal.

Re:Effect on cost

[Chibi Merrow]

1) To call this a "supercomputer on a chip" shows a person to either have a complete lack of understanding as to what is meant by the word "supercomputer" or a degree in Marketing and/or Business. I'm hoping in your case it's the former, not the latter.
2) A MacBook powered by a Cell would be significantly less useful to the average consumer than the current crop of dual-core machines. Primarily because desktop applications just aren't that parallelizable. Not to mention the eight Cell cores are individually rather weak. Would you rather pull your cart with 100 Chihuahuas or 2 Clydesdales?
3) On top of there being no way for desktop software to take advantage of 8 cores, there's no software written for the Cell architecture in the first place. Except, as you said, Linux, which is great but uninteresting to 99% of the laptop buying populace.

Re:Effect on cost

[edwdig]

There is a difference between being able to PRODUCE processors and being able to SUPPLY the cell processors. There have been more than a few occasions where Macintosh sales were hurt from CPU shortages.

That was mostly an Apple problem. When you order large numbers of processors, you have to place your order ~6 months in advance. Apple's strategy was generally to place a very conservative initial order then demand more chips immediately.

Re:Effect on cost

[Cheeko]

I don't think that anyone is debating whether the price of the PS3 will drop over time.

I think the general slant of the question was whether the price drops now as a result of this, or does Sony put the saving toward reducing their losses on each system sold.

Essentially the 2 options are 1) go for market share and keep taking a loss or 2) try to get each box profitable, and then worry about lowering the cost to the consumer as future improvements drop the cost further.

I have a feeling Sony will split the difference and sit on the increased profit margin for as long as their market share stays stable or until they have an exclusive to release. Then they'll pass a portion of the savings on to the customer in line with their eventual goals on margin for the boxes. (pass something like 85% of the savings on when they do drop it down the line a bit)

Be nice to volume customers

[Quila]

On the other hand, IBM couldn't even keep Apple happily supplied with G5s...

The current crop of consoles are giving IBM far more volume than Apple ever did. And these customers don't constantly need faster and more capable chips to keep up with the competition, just the same chips shrunk every once in a while. The G5 was a lot of R&D and production for a relatively small run.

Re:Be nice to volume customers

[Bill_the_Engineer]

Excellent point.

This would have made Apple's position even worse. IBM would be more inclined to favor the higher profit margin/higher production run for console manufacture, than the endless performance upgrades demanded by general computing. This has always been Intel's strength.

This is not IBM's fault. Intel knew early on that the way to sell more chips was to create business/production model that depended on making the current product obsolete with the next product release.

Re:Effect on cost

[statusbar]

And not just general code, it falls down on any problem that requires a non-trivial amount of memory to be available to each Cell SPE. It is like each SPE is an Altivec engine running only with cache memory and you must manually manage the cache completely. It is probably cheaper and easier to just stick two quad core intel cpu's into a system, and you'll get a better price/performance ratio especially when you consider the price of development to the arcane architecture.

PLUS the astonishing thing is that you can't buy Cell chips on their own! they don't sell them! they have no datasheets on them. IBM will only sell you large quantitiess of pre-made motherboards that have a cell on them for a huge cost per board, and they'll charge you $1 million dollars to design the board in the first place. The reason is that Sony and IBM co-designed the chip (Toshiba is involved too I think) and they have agreements where IBM won't sell to anyone without Sony approving it in case it may conflict with Sony's business interest.

Yes, at first the Cell looks/looked exciting, but after we went though the whole mess with IBM it just is not worth it or good enough.

--jeffk++

Re:Effect on cost

[bubulubugoth]

Your comment makes "Apple" like a victim...
If you take a look, IBM knew the shape of the upcoming video game market.

They traded 5% of the laptop market for 100% of the console market...

Just think, dealing with the Jobs ego of supply my micros NOW! vs a steady stream of Nintendo, MS and Sony...

How many macintel machines are out there including desktop and laptops vs, how many game consoles are out there?

I think is a fair trade... IBM movement of "letting" go apple is a very good one...

Re:Pricedrop?

[h3]

And who buys games new anymore? You can get plenty of great used games at any of your mall stores these days.

Umm....

Re:Effect on cost

[be-fan]

Uh, the original Cell used something like 70-80 watts. So right-out for a laptop. This new Cell might use something like 30-40, which is in the ballpark for MacBooks and MacBook Pros, but something like the Air needs a processor with half that power usage.

Oh, and the performance would suck. Cell has only a single 3.2 GHz, in-order general-purpose core. The 7 SPEs are largely irrelevant for the kind of tasks run on laptops.

Suitability for business use ++

[mowph]

A 40% drop in heat will make a huge difference in the suitability for business application of the PS3. (Before you say that business use of a PS3 is contradictory, please consider the accommodation industry.)

The instant they can get a PS3 (or an Xbox) that does not spew heat and use fans akin to a Boeing, it will have a place in the entertainment centers in luxury accommodation suites around the world. The region free PS3 game discs will seal the deal. Surfing internet on the TV and being able to show photos straight from your memory card is also a plus.

Late last year, we tried rolling the current model of PS3s into some guest suites. In the end there was no way to accomplish this without a major retooling of the entertainment centers, costing hundreds of dollars extra per unit. In one case the excess heat generated by the PS3 caused the TV to overheat!!

The drop in power bills will also be a big plus, as guests will generally never be bothered to switch off an appliance. I had thought that the PS3s were supposed to automatically regulate the amount of processor power needed. But they seem to run as many fans even when idling at the top menu.

For business use the maintainability and operation costs are a much bigger factor than the original cost per unit. If they can actually get the heat under control, Sony will break into a huge new market of corporate clients.

Re:Cell PC, Already?

[Doc Ruby]

Yes, I think that Sony would love getting the licensing fees from the ported games. All those games pay Sony a license to play on the PS3. The contracts include licensing for ports to other platforms that aren't the PS3. More sales, more money for Sony.

Also, Sony gets royalties on every Cell sold, having helped create it (and owning many of its patents).

So yes, I am suggesting "that IBM should sell processors to a computer manufacturer who will use them to make a desktop box that plays PS3 ports". Like to Sony. Then they could make a lot more money. But even selling to competitors they'd make money. Sony loves that, so I think they'd like that idea. Thanks for suggesting it.

Re:Effect on cost

[Moonpie Madness]

I agree that Sony is likely to drop price again before the end of March.

But I kinda think you're wrong about the value of a PS3 blu-ray player. They aren't that expensive compared to an average blu-ray player, and you have to keep in perspective that these blu-ray players often sit next to expensive televisions. I have to add that the PS3 needs a sound system to deliver the kind of sound most people want, so there might be a huge advantage to buying a normal bluray player if you lack a modern sound system. And of course many have to buy a USB IR device of some kind to use a remote control (I just use my PS2 remote).

I do not see a lot of living rooms relying on a PC or laptop for DVD playback, and perhaps this will begin to change more, but I doubt the PC is a statistical competitor to PS3s and normal players in the living room.

Note that the PS3 streams content very nicely, plays a lot of free demos, will probably be capable of renting movies online, and is future proof relative to other blu-ray players. And it's technically a PC if you add linux (and I do use my PS3 for MAME and word processing, so it's a legit point for a tiny set of the market).

I really don't understand how any of the other blu-ray players are selling well, and I think it's absurd to recommend anything but either a PS3 or a PC drive like you're saying to those who want blu-ray. And I have to ask what a PC does for your TV that a PS3 doesn't do? PCs and desks work very well together for work and surfing the internet in a way the living room couch can be a bit of a hassle. Why not leave the PC in the office when TVs can be in the capable hands of an xbox or PS3?