Do Xilinx Fix Their Prices?

I have some understanding for it. On the other hand I'm not complaining about prices. 20 years ago we made fast electronics with ECL. A few gates on a big board. Took a lot of power and it had to be tweaked for nanoseconds. The whole job then took us

6 months for the two of us. I can do the same now with just one small CPLD chip. With a doublesided layout. Say in 3 weeks.

We recently had some faster wishes. Spend 100k for an ASIC. It didn't work out finally.

The current CPLDs and FPGAs are excellent value.

Rene

On a sunny day (Mon, 09 Feb 2004 13:21:48 -0800) it happened Peter Alfke wrote in :

Hey, of cause things are expensive. Now log in to

Find a PIC, you can enter a quantity and order right there. Whats your problem? Perfect for small business. WYSIWYG

And you will pay some 3 or 4 times what you would pay if you were buying

1000's. I know, I have looked.

--

Rick "rickman" Collins

rick.collins@XYarius.com
Ignore the reply address. To email me use the above address with the XY
removed.

Arius - A Signal Processing Solutions Company
Specializing in DSP and FPGA design      URL http://www.arius.com
4 King Ave                               301-682-7772 Voice
Frederick, MD 21701-3110                 301-682-7666 FAX

Actually, Mike, Arrow is pretty good. They have much better prices than DigiKey, even for small quantities, and the online ordering is easy.

It's just that I chose a Xilinx CPLD for a project, and Brand X is not in Arrow's line card. In retrospect, the EPM7128AE in 100-pin TQFP would've done the job as well as the XCR3128 in the same package, although the CoolRunner is almost half the (onesy-twosy) price. Too bad the footprints aren't compatible.

There's different forms of price-fixing; collusion with competing companies is one form, like this:

that's not the type of price-fixing I'm on about. This is the kind of price-fixing I'm on about:

which is price-fixing by ordering distributors to charge certain prices or face the consequences, such as loss of the right to sell that car manufacturer's cars or worse trade terms.

You have to look at each situation within the context in which it is in. Crisps selling in a supermarket are hardly just one of two brands that are available, and I have *never* seen a pre-priced packet of anything in a supermarket that wasn't a decent price, and I used to work in a supermarket.

And what volume per annum would TALKING to the people start getting you discounts? 50k per annum or some such ridiculously high figure that start-ups cannot get to?

-- Steve

Steve,

If you never ask, you will never know (how many is 'enough').

I had an email from someone on this group, who asked, and was pleased with the result. If you are going to order 25 a month, for the next year, that is a lot more useful information than a single order of 25!

Aust>

This is really simple, Capitalism 101:

Manufacturer invents and makes part. Uses seval competing distributors to sell the part to the public. Manufacturer optimizes his profit by charging distributor a certain price, and also publishes a pricebook with "Manufacturer Recommended Resale Price" MSRP. Distributor can sell in any quantity and for any price he wants, high or low, but he will try to optimize his profit. Customer will buy at the lowest possible price consistent with the desired level of service and support. This is true for food, shirts, cars, and ICs. For Tiffany's, Nordstrom, Safeway and CostCo.

But rest assured that we are seriously looking at ways to improve the plight of the low-volume customer. Some of your complaints did not fall on deaf ears.

Peter Alfke ===========================

Aust>

This is really simple, Capitalism 101:

Manufacturer invents and makes part. Uses seval competing distributors to sell the part to the public. Manufacturer optimizes his profit by charging distributor a certain price, and also publishes a pricebook with "Manufacturer Recommended Resale Price" MSRP. Distributor can sell in any quantity and for any price he wants, high or low, but he will try to optimize his profit. Customer will buy at the lowest possible price consistent with the desired level of service and support. This is true for food, shirts, cars, and ICs. For Tiffany's, Nordstrom, Safeway and CostCo.

But rest assured that we are seriously looking at ways to improve the plight of the low-volume customer. Some of your complaints did not fall on deaf ears.

Peter Alfke ===========================

Aust>

I have found that a 1k per year quantity will get you discounts. Actually, I got a decent discount once when I was saying I would buy in lots of 100 and I was quoted a price for 100 per year! That was on an Altera part if I remember correctly.

In another case, I was given the qty 50,000 price when I was promising

1k per year.

Both Xilinx and Altera have lots of room to discount from the list price. But if you are only buying 100 total, I don't see how the parts cost you will get standard will affect your competitiveness. At low volumes there are much larger costs that dominate your pricing; NRE (design and prototyping), support, even the cost of sales. If you aren't making 1000 or more of something the cost of the parts is not going to break you.

--

Rick "rickman" Collins

rick.collins@XYarius.com
Ignore the reply address. To email me use the above address with the XY
removed.

Arius - A Signal Processing Solutions Company
Specializing in DSP and FPGA design      URL http://www.arius.com
4 King Ave                               301-682-7772 Voice
Frederick, MD 21701-3110                 301-682-7666 FAX

How is this any different than any other product? Resistors, for example. Go to digikey and try to buy 3 0805 100 Ohm resistors. Your price per resistor will be much higher than if you bought several dozen reels from a distributor.

Xilinx gives me good support. Great support. It might be that I have found documentation errors, errors in unisim/simprim models, and that my questions are usually (but not always) valid. I don't call asking why my code is resulting in a latch, for example. I sometimes ask a stupid question, but I try not to.

All this while I am a small customer. It might be that I have worked in the past for large companies. It might be luck. The Xilinx support web site sometimes bites in the performance department, but I get great support when it is working, and good support from local (factory and disty) FAEs if they aren't swamped.

I have also received good support from Actel and Altera. I received good support from Actel on a part that they new was going to be used in test equipment, that they knew we would only buy 3 of their devices for...

I don't think anyone expects a flat price curve ( except in the promotion special case I mentioned earlier ).

What is at issue, is the lazy application of the jelly-bean-resistor type price curves to much more expensive parts.

Each sales transacton has a cost, and each customer call has a cost, but those costs do not scale with the device price.

eg A price structure that has a 1 off price of $15, and volume price of $4 is probably OK to most users. What's harder to justify, is a 1 off price of $150, and volume price of $40. In one case you are saying "it costs $11 more to handle small volumes"

- fine, but how can that possibly justify $110 extra on the larger device - ?

-jg

Interesting thread. I reply to the top message because of the many tentacles the thread developed.

Yes, of course, we would all like to pay less. No question about it. And, it does hurt to have serious doubts about whether or not a product might be viable mainly due to the cost of the FPGA's you'll need in small quantities. I understand this very well.

The error here might be a good-old standard in business: communication. Talk to your sales rep. Contact Xilinx/Altera. Let them know what you are doing. Explain what problems you have. There are real people behind the emails, websites, brochures and chips. Make contact. You'd be surprised to learn what can be achieved with a little bit of effort.

From the perspective of a small company I can tell you that I'm blown away to see the effort put forth recently (and continuing) to support us. This both by Xilinx and Avnet. Both of these companies could afford to loose our business and they wouldn't even know it happened. However, like I said, there are people behind it all. Never forget that.

-- ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Martin Euredjian

To send private email:

0_0_0_0 snipped-for-privacy@pacbell.net where "0_0_0_0_" = "martineu"

Yes, then add 15$ for shipping the 3 resistors. Or 30$ or so for express delivery.

Rene

This is really simple; Oligopoly 101:

Oligopolists value high order quantities highly and small order quantities as not being worth the hassle. Oligopolists watch competitors and are happy if all oligopolists in the market view small order quantities as not being worth the hassle. Certain oligopolists have a high vested interest in having smooth and monotonic price vs size curves, which can be maintained by having few distributors, and *possibly* a say on the prices they charge to buyers, and *possibly* exert pressure on distributors to toe the line. Oligopolists are happy. Those wanting to buy small order quantities are screwed.

I'll quote the British phrase "the proof of the pudding is in the eating", or in other words I'll believe that when small quantity prices come down...

-- Steve

--

--Ray Andraka, P.E. President, the Andraka Consulting Group, Inc.

401/884-7930 Fax 401/884-7950 email snipped-for-privacy@andraka.com

"They that give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety." -Benjamin Franklin, 1759

Actually, more recently than I asked for support on a CPLD ;) but I do get your point...

than a per piece

peice is going to

I believe I said that. The question is how to justify the $40 -> $150, alongside the $4 -> $15 device price/volume curve. FPGAs are a great example of where bigger devices just give you more of everything - the software tools are identical, and in most cases so are the building blocks, and even large chunks of data. So the tech support cost of the large/small fpgas are largely similar.

The real reasons for such lazy pricing have more to do with the bean-counters, and wanting to have a certain % margin on stock. Which is OK if the disti's actually HAVE stock...

Solution would be to have a WEB page sales system, that has a relatively high ($20-$30-?) line item processing charge, and a more sensible true device cost on the silicon itself. Still makes a nominal profit, but accelerates the design-wins, and ramp-ups of the devices...

-jg