March 28, 2016, anysilicon
There have been many debates around the final cost of an IC. Over the years the misconception and failure to agree on what the calculated IC cost would be. The reason for this is that ICs are a simple concept anymore. Technology moves at an extremely fast pace and chip designers have to keep up with this when calculating the IC cost.
A while ago, silicon die used to be the dominant factor when it came to calculating IC costs. Back then, estimating a chip cost was as easy as determining by die size of the chip. While silicon still remains a major key element in the equation, it has become necessary to consider all the other components that play an equal important role.
Experts have noted that there is a very simple equation one can use in order to determine the final chip cost:
Final IC cost = package cost + test cost + die cost + Shipping cost
This equation then takes care of all the necessary factors that have the hugest impact on the production of the chip. Of course there are other factors that might be calculated into this standard calculation. For example, shipping costs can also be factored in. This includes things like shipping, handling, ERP system, trays and boxes, insurances, and other costs that you need to consider.
The most important element to keep in mind when calculating IC costs is the price may change during manufacturing process due to several reasons. The most obvious reason is that some price elements are not yet set. For example yield and testing time. Also, technical decisions that are made during the manufacturing process can have a huge impact on the economic status of the project. The only way to make sure that you are calculating an accurate IC cost is to understand that some things are still open.
Early analysis is the key to ensuring that you keep the IC costs under control. Therefore, we have made this calculator that can help you get a good estimate of the final IC cost.