Question

In section 1.9 (AICN) the assertion is made that Ethernet is inexpensive. How inexpensive? Find an Ethernet PHY layer chip on the internet. How much does it cost in volume (i.e. if you buy a 1000 of them, what is the cost per chip.)

Answer 1

Solution for the problem is provided below, please comment if any doubts:

Ethernet is inexpensive in the context of:

• For a same bandwidth requirements the equipment used in Ethernet are far cheaper than the equipment needed for same bandwidth for other technologies like wi-fi.
• Since the wired connection is used and dedicated channels are available, Ethernet will give reliable connection at lower cost.
• Since primitive technologies are sufficient to make the connection in Ethernet, the high cost advanced technologies are not needed.
• The setting up of Ethernet does not requires high proficiency, thus the cost can be reduced in this sector also.

A commonly used PHY layer chip that can be purchased from internet is:

DP83867ERGZT IC Ethernet PHY

• The unit cost is nearly $10.24 per piece.
• In bulk it cost around $7200 per 1000 pieces.
• Thus cost per chip in case of bulk purchase is only around $7.2