The Hidden Cost Of Intel's $700 Million SB Recall

[Guest]

Perhaps it is just me, but something about Intel's Sandy Bridge chipset recall just does not add up. Nvidia may have a few words to add to the story.

The Hidden Cost Of Intel's $700 Million SB Recall : Read more

 

[Kaori Cpu]

I was actually planning to Purchase an i5 2500k and everything else with it off of newegg with in the next 2 weeks...this kind of pisses me off

 

[bison88]

Good to see reputable sites like Newegg taking good action even if it's drastic to save customers the time and money of accidentally purchasing one of these faulty boards even if it cuts some of their sales. It'll probably make up far more in the long run. Long live NewEgg

 

[one-shot]

"why didn't Intel's validation team catch this problem?"

It is because of different revisions. On A Revision the faulty transistor isn't present. However, it is present on the B revision which is the one that has the issues. This is why. That information is widely available all over the web.

 

[_Pez_]

Intel and it's errors Buuu !!! AMD is taking too long !!! BUUUU !!!

 

[Guest]

FAIL in math ... $700,000,000 divided by 8,000,000 shipped = $87.50 each, not $880

 

[geekapproved]

I think it's going to be a LOT more than $700 million.

 

[gti88]

[citation][nom]jeterder[/nom]FAIL in math ... $700,000,000 divided by 8,000,000 shipped = $87.50 each, not $880[/citation]
Yes, I've noticed that too.

 

[tf2287]

Since its actually $87.50 per, the likely final cost will be much much higher

 

[-Fran-]

Well, if the error is found when they, let's say, have sold nearly the 8M units, think about lawsuits when some data was actually lost.

I think 700M now is way cheaper than a big lawsuit from a lot of people sown the road. Way cheaper.

Cheers!

 

[Onus]

Here's one remark from the supporting link I found relevant:

"The scenario where Intel got 492 specific, repeatable, and very emblematic problem reports on the same day late last week that allowed the engineers to pinpoint the error in record time seems impossibly silly. Intel has some of the best silicon engineers in the world, bar none, backed by the best tools in the world, but this is too much of a stretch..."
I'm not supporting Intel here, and the article raises some questions, but:
1. Any sufficiently advanced technology is indistinguishable from magic. If Intel's engineers and their tools are that good (I have no reason to believe otherwise), then I can accept that they accomplished discovering and implementing a fix in record time. Consider the impact of satellite technology on the first phase of the Gulf War; Saddam had no clue then, and those outside Intel may not either now.
2. Who knew what, and when, may be of considerable interest, and more details may come out that point to dishonesty or other wrongdoing. As the article points out, the costs to Intel of this kind of nonsense would be huge; hopefully knowing that, they had enough sense not to have pulled any of that sort of nonsense.
We'll just have to see what happens!

 

[virtualmatrix258]

What's funny is I just bought a new Core i7 2600k and an Asus P8P67 Pro mobo along with it lmao...

It's all good though, just use your SATA 6Gbps instead of the 3 and wait to hear something from Intel regarding an RMA process.

 

[wawa sxm]

i'm pissed too, i can't beleive we're gonna have to wait till april for sandy bridge just because of a faulty sata3gb connection..really?? thats over kill

 

[g00fysmiley]

this is going to delay am3 price drops >_< growl i was hopign to pick up a chaepish 1090t

 

[tpi2007]

Well, actually, I think they didn't do their math very well.

If you read in here - http://www.anandtech.com/show/4143/the-source-of-intels-cougar-point-sata-bug on Anand's analysis (The "It’s Notta Recall" paragraph), you'll see that the cost Intel estimates comes down to more or less full motherboards - $87.50 per chipset, which kind of makes sense, even if they don't have to make a whole new motherboard, it still costs to desolder the old chipset, labour, and testing, packaging, etc.

The thing is, all the stores and the distributors also have a stock of Core i5's an i7's they can't sell. Well, they can, but nobody will buy a CPU without being able to buy a Motherboard until March or April.

So, the stores will want to receive Nehalem based CPU's for free and only pay for them once they can restart selling SB CPU's. Or they will want to return the SB CPU's and get Nehalems in exchange. Either way, Intel must account for the CPU cost part of the equation, which I think they haven't (at least publicly).

It's unclear how they are going to handle the situation, but this is not going to be easy for them in the next two months.

And even consumers are left in an awkward situation. They can't return the motherboard now, because there is no fixed motherboard available to exchange with, unless they can also return the CPU (but what if they bought it from a different store ? - how is Intel going to handle this ?), and chose to get the money back or exchange with a Nehalem based system instead.

And what about consumers that use more than 2 Sata ports ? It's actually quite easy to happen: 1 main HDD + 1 DVD RW/Blu-Ray already fill both Sata 3 ports. With more and more people buying a second HDD to store videos and photos (or a low capacity SSD to boot from, putting the HDD as the "documents disk"), you're walking into trouble already.

How does the store solve this problem, especially if you bought the CPU and motherboard from different shops ? Does the motherboard seller give you a PCIe sata add-on card for free so you can solve the problem ?

This is a PR nightmare.

 

[blibba]

You based the entire story on some flawed maths. So, now you can either edit the maths so that the story doesn't make sense, or you can just delete the story. Nice one Toms.

Protip: Proof read next time.

 

[pacioli]

$87.50 each chipset... hmmm... My Asus p8p67 Pro mobo cost $190 plus tax. They have to pay to have it shipped back and forth and replace with an entirely new mobo. Plus they better give me some sort of upgrade 'cause I am kinda pissed over the inconvenience... I think it will definitely be more expensive.

 

[Onus]

The elephant in the room is AMD. That won't matter the least bit if Bulldozer sucks. If it doesn't, then two additional but unrelated possibilities come to mind:
1. If Sandy Bridge really wasn't ready, can AMD's lawyers convince a [non-techie] court that Intel released it early anyway just so people wouldn't buy AMD?
2. If Bulldozer is "decent," how many people left with a sour taste in their mouth by this mess might decide to give AMD a shot?

The plot thickens.

 

[thomaseron]

Bulldozer FTW!

 

[woshitudou]

Cyrix 6x86 ftw!

 

[EnderWiggin]

[citation][nom]virtualmatrix258[/nom]What's funny is I just bought a new Core i7 2600k and an Asus P8P67 Pro mobo along with it lmao...It's all good though, just use your SATA 6Gbps instead of the 3 and wait to hear something from Intel regarding an RMA process.[/citation]

Exactly. I just swapped my HDD and DVD to the 6G ports... problem solved.

 

[CyberAngel]

1) Intel has one of the best chip technologies in the world. I think they rushed it.
2) Not enough SATA3 ports is a problem. Why buy the latest technology if you can't fully use. I mean even a fixed chipset is broken (for me).
3)
My estimate on total cost is more than three and half billion USD.
That includes total motherboards shipped back with SB + other costs.
4)
Buy Intel stock now, it's cheap...or wait for the better cost estimates to kick in...or wait for Bulldozer...anyway: buy Intel, it's cheap now. That juggernaut will be more expensive when Ivy Bridge arrives. Then you either sell or just profit.

 

[nagrajan]

jeterder :

FAIL in math ... $700,000,000 divided by 8,000,000 shipped = $87.50 each, not $880

Not actually a FAIL. $700M divided by 5-15% of 8M ~ 800K, ~ 875$ per chip.

 

[cangelini]

[citation][nom]jeterder[/nom]FAIL in math ... $700,000,000 divided by 8,000,000 shipped = $87.50 each, not $880[/citation]

Hey guys, thanks for the eyes on this. Just chatted with Wolfgang and he passed along the following clarification:

"Wolfgang Gruener: Yes, I am guilty. In the original version of this article, the replacement cost per chip was said to be $880, which was obviously wrong, if $700 million relate to 8 million chips. This was a prime example of fingers being faster than the brain and I am gratefully that some eagle-eyed readers stepped on my toes. That said, the argument of the article remains the same. I don't think that Intel has said everything that is involved, especially since CPUs are pulled as well and that we know that these recalls are traditionally more expensive than the initially estimated cost - including rather blurry revenue impact such as consumer confidence."

 

[wunderkinder]

[citation][nom]CyberAngel[/nom]1) Intel has one of the best chip technologies in the world. I think they rushed it.2) Not enough SATA3 ports is a problem. Why buy the latest technology if you can't fully use. I mean even a fixed chipset is broken (for me).3) My estimate on total cost is more than three and half billion USD.That includes total motherboards shipped back with SB + other costs.4) Buy Intel stock now, it's cheap...or wait for the better cost estimates to kick in...or wait for Bulldozer...anyway: buy Intel, it's cheap now. That juggernaut will be more expensive when Ivy Bridge arrives. Then you either sell or just profit.[/citation]

do you guys just pull numbers out of your butt?