Low-cost PCs are Intel's new goldmine; Atom is 85x more expensive than gold

Intel seems to have struck gold with the new emergent low cost PC segment, pioneered by Asus EEE PC launched last year and according to some sources, the semiconductor giant might earn more from the new Atom family than from its popular Core range.

Tomshardware reckons that Intel could make nearly 1600 percent profit on the sale of its most expensive Atom Z540 which costs as little as £4 to manufacture.

Each 300mm wafer can produce up to 2500 CPUs and at a minimum selling price of £10 (the cost of the Z500), puts the price of each wafer (weighing 127.62g, see this Powerpoint presentation) at £25,000, that's thirteen times the price of Gold at the time of writing

The Z540 will cost nearly 85x more than gold at comparable weight; Intel is able to achieve such profit margins by cramming more transistors than ever per unit area and by minimising the complexity of the process - which in turn increases yield rates.

The Atom family will benefit from the latest Intel technology and from massive economies of scale as Taiwanese manufacturers have already pinned great hopes on the newly found ultra cheap PC segments.

Acer and Asustek have already announced that they will sell more than 10 million such PCs in 2008.

(Ed : Cyrix MediaGX launched the real low cost PC revolution back in 1997, this caused Intel to retaliate with the launch of the Intel Celeron range).

You can read our review of the EEE here