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by jareklupinski 1245 days ago
knowing it would cost that much ahead of time would let the purchaser and engineer work together to determine if it would be more cost-effective to swap that part out for a similarly specced but less expensive chip, or rework the circuit to use a slightly different chip, perhaps with two chips instead, or more jellybeans to make up the lost functionality

a ten million dollar machine missing a 45 cent part probably costs a few hundred thousand to redesign around that part. a mass market vehicle that needs multiple of those part per SKU would be cheaper to re-engineer
1 comments
ilyt 1245 days ago
> knowing it would cost that much ahead of time would let the purchaser and engineer work together to determine if it would be more cost-effective to swap that part out for a similarly specced but less expensive chip, or rework the circuit to use a slightly different chip, perhaps with two chips instead, or more jellybeans to make up the lost functionality

And now you have not one but 2-3 chips that are in demand and price rises for those too.

Also in case of cars and similar equipment there would be a bunch of re-testing required so that drives cost of reengineering hard.

Especially if said part was used as "jellybean" across a lot of modules just because it's cheaper to buy same part in bulk

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jareklupinski 1244 days ago
if a part started off costing 45 cents, it can't be too difficult to reproduce using transistors or similar components from competitors. re-certification for simple subsystems like that (or just using a competitor's chip) would still be less expensive than paying $100 per part on a SKU/car that you are producing 10,000+ units of. TI's 74AHCT595 is probably functionally similar to Nexperia's/NXP/Diodes Incorporated (digikey shows those 4 vendors for that chip)

there is also the option of the buyer just saying 'nope, not worth it', and cancelling the product line the chip was bound for, which would be worse for the chip manufacturer who just sunk millions into producing the part

it's an intricate balance :) regulatory bodies aren't fans of price gouging either, and might step in if the delta is actually that drastic (tangential but relevant https://en.wikipedia.org/wiki/Martin_Shkreli#Daraprim_price-...)

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