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X Tca Scale Economics Panel204 040408
 

X Tca Scale Economics Panel204 040408

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    X Tca Scale Economics Panel204 040408 X Tca Scale Economics Panel204 040408 Document Transcript

    • xTCA Scale Economics (Panel 204) B.W.Stuck  Managing Director, Signal Lake  606 Post Road East, Suite 667  Westport CT 06880  Voice: +1.203.454.1133  bartstuck@signallake.com    A key underlying issue in xTCA (Advanced Telecom Computer Architecture (ATCA) and  microTCA) is If xTCA economics are so good, why isn’t xTCA market growing faster?    Yes, it’s true that the penetration curve for any new technology takes time, typically five to ten  years for embedded computing packaging technologies such as VMEBus and CompactPCI    However, most of us have been disappointed at the rate of growth, particularly for µTCA.   Conversely: If the xTCA market isn’t taking off that rapidly, maybe the underlying economics  aren’t that good?    In a British Telecom presentation (Murray Cooke 9/25/07) stated    “Proprietary is less expensive”; “HP price differential for ATCA Carrier Grade vs c‐Class”  “ATCA volumes much lower than Enterprise IT, so unlikely to be cost competitive for  same functionality    Scale Curve Concept for Electronics Economics     The scale curve concept is based on empirical observations (popularized by Boston Consulting  Group in the 70s)    For each doubling of scale, unit costs come down by a constant percentage margin  For a typical 85% scale curve, each doubling of volume results in a 15% reduction in unit  cost    Based on this analysis, it appears that a significantly cost reduced version of microTCA offers an  excellent opportunity to be a high volume, cost effective packaging technology, a real market  winner for xTCA.  Copies of the presentation are available at http://signallake.com/