Ultrabook prices will begin to fall next quarter partially thanks to a $100 subsidy finally offered by Intel.
Intel has reportedly heard the plea of ultrabook manufacturers, and will supposedly offer a $100 marketing subsidy. Acer, Asustek Computer and Toshiba were already gearing up to lower ultrabook prices by the end of the year, but the subsidy will now allow them to drop prices an extra 5 to 10-percent in the first quarter of 2012.
Ultrabook manufacturers have complained for some time that it will be difficult to keep prices under Intel's requested $1000 price cap. According to sources, the BOM (bill-of-materials) for a 13-inch ultrabook equipped with an SSD is estimated at $690 USD. Throw in OEM costs at $100, marketing/distribution costs at $150, and the device ends up costing an overall $940 USD.
Obviously there's really no room for profit without pushing the retail price beyond the $1000 point. The CPU itself costs manufacturers around $175 to 200 USD, the 128 GB SSD around $140 to 150 USD, and the LCD panel $45 to 50 USD. Intel's $100 subsidy may not seem like much at the end of the day, but at least it's something.
As reported earlier, ultrabook manufacturers plan to cut costs by using cheaper materials such as replacing the magnesium alloy chassis for one made of fiberglass. The chassis may also switch from a unibody design to a cheaper hybrid design using aluminum on the outside but plastic parts on the inside. There's even been talk about using hybrid hard drives so that ultrabooks can supply the capacity of a hard drive and the speed of an SSD while keeping the cost somewhat reasonable.
Recent reports have indicated that up to 50 ultrabooks are scheduled to make an appearance at CES 2012 in January. These will be presented by Lenovo, Hewlett-Packard, Toshiba, Dell and others.
We just spoke directly to Intel and were told flat out that no such $100 subsidy will exist for ultrabook manufacturers. That's not to say that prices of ultrabooks won't be coming down in 2012--but if they do, it'll be from improvements and innovations in design rather than from Intel's pocketbook.