Well, let's estimate what the marginal cost of a completed TerraMiner IV is, not counting NRE costs.
1) According to this study, a wafer from a fab costs between $2000 and $4000:
https://server1.tepper.cmu.edu/seminars/docs/BKM_semicon.pdf2) According to this picture(
http://cointerra.com/wp-content/uploads/2013/12/photo5.jpg), Cointerra gets about
(# of chips, length-wise)^2 * (Ratio of square area to circular area)
= 28 * 28 * (0.78)
= 611 chips per wafer
Therefore, the marginal cost per chip
= (Cost of wafer) / (# of chips per wafer)
= $4000 / 611
= $6 per chip
3) That means the marginal cost of *just the chips* in a TerraMiner IV is:
(#chips per TM IV) * (cost per chip)
= (4*4) * ($6)
= $96
4) Approximate the cost of all the components of the chip, plus the marginal cost of the circuit board creation:
VRMs:
Digikey has something quite like what they're probably using for $8:
http://www.digikey.com/product-detail/en/IR3551MTRPBF/IR3551MTRPBFTR-ND/3770518Therefore, the cost is:
(8*4) * ($8)
= $256
Two power supplies @~$300 each:
https://www.verical.com/#searchCriterion=mpnIDs&searchName=&landingPage=catalogItemView&searchTerm=295479&_i_=22*$300
= $600
Cooling components:
4 * (water blocks) + radiator + fans
4 * ($50) + $50 radiator + $20 fans
= $270
Circuit board marginal cost:
$100 * 2
(I don't have a good idea of this)
= $200
Miscellaneous capacitors, resistors, and other components:
$100?
The beaglebone black:
$100
The case
$50?
Total:
265 + 600 + 270 + 200 + 100 + 100 + 50
= $1585
5) Therefore a pretty rough guess on the cost of a unit below which Cointerra is actually losing money is $1600. Even if the cost estimate of the chips is an order of magnitude off, the price can still drop $1000 (i.e. go to $2600) and maintain a slim profit. Remember, these are *just* the material costs. The cost of doing business is *way* high than these costs - salaries, software, rent, etc. are huge for this kind of operation. The prices they've been charging have been recouping these costs in theory.
i think you're light on some of the costs. the ones that stick out, I'm pretty sure wafers (in 28nm) cost more than the $4000 you suggested 'to buy' (maybe 'to make' they're cheaper as clearly the fabs aren't doing it for charity).. so you can assume the asics cost more than you're assuming. also, you've only costed raw wafers, and haven't included what it costs to turn dies into asics (bumping, dicing, mounting on substrates etc), nor have you accounted for 'yield' (the number of working dies on a wafer is never 100% as there are always defects in wafer production and some dies won't work and all need to be tested to find the working ones.
you also didn't seem to include anything to manufacture the box. a factory needs to assemble the parts.. solder the chips, put in in a chassis.. connect the wires. i.e., its not sold as a kit for the customer to build.. a bunch of factory workers actually make it, and charge to do it.
also, you deliberately ignored the two biggest costs (which are up-front rather than production costs). 1, the design of the system (engineers get paid salaries) both the asic itself and the board and the rest of the system and programming the controllers etc- probably in the $2m-$3m range. And the Silicon nre (which is millions - probably $5-6m - for back end layout, and mask production etc).. and if you only build thousands of systems, its a very large factor in the unit cost of each one that must be taken as contribution or amortisation etc. since cointerra has announced they've sold 5,000 systems to date, and the nre and design costs are probably >$7m, you should add at least $1200 to contribute to the cost of each system produced (at least so far). obviously the more they make, the less that contribution per box becomes, but it can't be ignored as its a cost of doing business.
I wouldn't buy one just thought that ppl would be interested. And all these price cuts drive the price down for other miners.