Ultrabooks Aren’t Providing Large Enough Profit Margins, Yet

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21 Sep, 2011 12:52 am


When you’re blazing new trails with an Ultra Thin Category of course the parts necessary are still going to be a little more expensive because they aren’t as common as traditional notebook parts. What this means is that each Ultrabook can only contribute an average profit of US$5-10 to notebook ODMS, 50% lower than the average of US$10-20 for traditional notebooks.

Right now the current mentality around the Ultrabook is skeptical since there was a platform called CULV which was not successful and Intel also pushed it on to ODM/OEMs. So still feeling the financial burn from a platform that was unsuccessfuly pushed by Intel they aren’t exactly ready to jump in with both feet on Ultrabooks.

Ultrabooks are pushing its ultra-thin design with a thickness of only less than 0.8-inch, which requires the adoption of an unibody magnesium-aluminum alloy chassis, which is priced 5-7 fold higher than the traditional plastic chassis. Hollow hinges are used in Ultrabooks are also 3-5 fold more expensive than traditional hinges. Both of these features significantly reducing ODM’s profitability from Ultrabooks.

However, the high component costs may have a chance to improve after shipments started to increase in 2012 since the current high cost is mainly due to limited shipments. So we’ll need to see consumer interest if volumes are going to really start to increase. 2012 will be a very telling year for the success of this form factor.

Not sure what an Ultrabook is? The ASUS UX31 is our top favorite at the moment, check out our hands on video:

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Via Digitimes

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  • Orion9727

    i think they have a copper alloy rather because it far stronger.
    one maker has gone this route it really a old german ww2 design when alum was ultra expensive and copper added hardens at room tempture.
    the other thing is it can act as a passive heatsink after all that’s what hardcore gamers choice of case metal is.
    yes cost is higher but most cheap notebooks today are just plastic no other alloys other then the hinge and the product while light wont hold up the way metals do in a unibody form.
    i think the major cost is really in the cpu as mobile chips eun in the 250-350 doller range plus 50 for southbridge so we talking 300 dollers for a i core and thats really where the cost problem most makers see.
    if a chipset solution could be found around 90 or so then uktrabook makers would have something they could work with.
    they main problem they have is they need a CULV solution like what most ultra pack now minus the northbridge cost and a hard push by intel to lower nand cost with ssd ramped up production.
    remeber intel also has a nand fab to boot and that why intel is pushing so hard really.
    it not the chips they want to sell with a product mac allready owns but they want to push hard on there lower cost nand they sitting on.
    after all what dose it matter what kind of notebook you buy to intel aslong as it has a intel cpu right but remeber what intel design specs were.
    they want to dry up the nand market and the best way to do that is to push hard for a ssd standard.
    i think this could come back and bite intel if they cant find a cheaper chip after all amd is the discount king right.
    well atleast intel all over lightfoot right.

  • Anonymous

    It’s BS to compare Ultrabooks to the CULV chips. CULV chips had chips that were faster only when compared to the Atom and Brazos chips. CULV platforms used low quality components to keep the price down, while Ultrabooks will use some of the best ones.

  • Orion9727

    CULV chips beat allmost any entry level desktop chips hands down.
    they just clocked lower so they dont exceed the system tdp.
    all chips do this with EIST enable.
    even all desktops.
    most people dont know that the power models used do cripple the system alot most of all on 4 and 5 series chips.
    you must disable certin power management features when on the cord to really have them run well with a ssd.
    atoms and such are a total different design with a quarter the amount of trasistors.
    culv chips are the exact same chip with it top end lowed.
    eist dose this.
    your desktop dose this.
    every chip will do this even if it on the cord unless you disable idle.
    there so many pwer settings with the cpu and the chipset and power states that effect the hard drive that exist allready you dont even know and this is why most people opt for the most expensive cpu possible because they think it will curise faster.
    the fact is that intel new cpu dont use any less power in idle then the 45nm did.
    thye have hit kinda a brick wall there.
    they however do run better in the top end but all sandy bridge also exceed the heat of older chips as well.
    sandy bridge is a very powerful platform that can preform tasks much fater and as such can more to idle quicker.
    thats where it power savings trully come in.
    CULV chips are no different then any other chip except they are clocked lower to prevent the max heat a normal chip could do if run full out.
    most programs wont tax a cpu that much and stress all it cores so there trully no need for a higher tdp.
    if a program can only use 20–30% cpu then a lower clocked lower voltage chip will seem allmost the same.
    sandy bridge normally and most all cpu run at half speed due to power settings and it acting as a ulv and you just dont see it.
    EIST and C states are why people think they need a more powerful cpu.
    how windows is running  and what is running and disk speed really make the experence much different for each person.
    CULV chips just have a lower vcore due to fact they wont run at a higher speed and that vcore is alot closer to the min vcore needed that selected due to a more mature process.
    normally cpu vcore are the  vcore of the first run and as the process matures lower is posible and also from certin fabs.
    this is why undervolt programs work so well if you know what a cpu can do.
    intel just picks a fab then changes a few settings and call it CULV.
    it is not diffent then any other chip infact your cpu can do exactly that.
    pc makers can even do it in the bios to avoid buying more expensive chips.
    why they dont allow changes in the bios in the first place.
    as for chip prices intel marks price at a per 1000 model and that is that.
    they cant make exceptions or else incur the wrath of price fixing and anti trust laws.
    like the lawsuits over rambus and other fascios.
    they also cant favour a certin maker or else they risk lawsuits or eurozone reade restrictions.
    my main point is sandy bridge really dose not have a CULV chip in it line up.
    all the lowest are either cripple chips or i7 at 17 watt tdp.
    normall is 25 tdp for full size notebooks.
    if you want lower you have to look at 45 nm but when you add the north and south bridge they factor in the same really  for system TDP.
    sandy bridge is new so i expect a CULV well before ivy bridge and i expect that to be the ultrabook only solution if the price is around 100.