Overview / Main Features
Netgear's FS116 is a simple 16 port fast Ethernet desktop switch with auto-sensing connectivity for as many as 16 users. It is a fairly 'generic' piece of networking hardware that has a lot of competition including brands such as D-Link, and lesser known brands such as Intellinet, TP Link, and others.
Inside the Netgear FS116 is a fairl;y simple design and is based on two different Broadcom chips: a BCM 5310xxxx Ethernet Switch Controller and two BCM5288xxxx Ethernet Transceiver 8-Port ICs. The rest of the design are minor components (from an electronic perspective - with much of the cost drivers relating to Ethernet passive components (magnetics modules for 10/100 Base-TX ports) and the multi-port RJ-45 jack arrays. The enclosure is super simple and is a two-piece metal enclosure that makes the FS116 both easy to produce and also fairly rugged.
Enterprise users - small businesses
Pricing - MSRP is $96, but is broadly available online for around or under $60 USD at the time of writing (Jan 2012)
Availability - North America primarily
For the purposes of this teardown analysis, we have applied a 4 year production volume of approximately 600K units.
As a reminder, teardown volume production assumptions are primarily used for our cost analysis in terms of amortized NRE and tooling costs, especially for custom components specific to the model being analyzed (mechanical components especially). Unless assumed volumes are different by an order of magnitude, minor changes in volume (say 1 million vs. 2) rarely have a large net effect on our final analysis because of this.
We know from conversations with IC vendors in the Ethernet space that competition is tough and margins thin. The key integrated circuit content is modeled accordingly, though we understand lower margins are common beyond the 45 point assumptions we have made for Broadcom.
The magnetic filter modules and RJ45 multiport jacks are also big cost drivers, and in these areas manufacturers often have less flexibility once designed in.
NOTE: As a special request we were asked to also run manufacturing costs as if the device were 'Made in USA'. This can be achieved easily in the 'assumptions' tab by users. If you go the country of origin 'China' and select 'USA' from the pull down menu for both assemblies, then refresh the pivot tables - the analysis will refresh manufacturing costs for a 'Made in USA' assumption. This pull down menu only affects the cost of manufacturing and does not alter materials costs. In fact, whether Netgear manufactures this product in the US or China, the materials costs (with the exception of the enclosure perhaps) would be the same, as most major manufacturers have global pricing contracts in which they can buy the same components at the same price regardless of the destination of the components.
Main Cost Drivers ~ 90 % of Total Materials Cost
Delta Electronics - LFE8731 - Ethernet Magnetics Module - Quad Port, 10/100 Base-TX - (Qty: 4)
Suzhou e-Conn Electronic - - Jack - RJ45 8P8C, 1x4, Right Angle, w/ 8 LEDs & Metal Shielding - (Qty: 4)
Broadcom - BCM5310KQMG - Ethernet Switch Controller - 10/100Mbps, 16-Port - (Qty: 1)
Broadcom - BCM5288UA0KQMG - Ethernet Transceiver - 10/100Mbps, 8-Port - (Qty: 2)
Jiangmen Glory Faith Pcb - - 2-Layer - FR4, Lead-Free - (Qty: 1)
Enclosure, Main, Bottom - Stamped / Formed Electro-Galvanized Steel, Painted, Printed, w/ 8 Pressed-In Threaded Stand Off & 2 Integral Joints - (Qty: 1)
Ceramic Multilayer - X5R/X7R - (Qty: 238)
Enclosure, Main, Top - Stamped / Formed Electro-Galvanized Steel, Painted, Printed, w/ 1 Pressed-In Threaded Stand Off - (Qty: 1)
Anpec Electronics - APW7037A - Regulator - DC-DC Controller, Step-Down, PWM, Synchronous, 400KHz - (Qty: 2)
Insulator - Polycarbonate Sheet, Die-Cut - (Qty: 1)
Direct Materials + Manufacturing $30.80*
- This total is based on a 'made-in China' scenario. If we select Made in USA for both the PCB assembly and final assembly this total becomes $34.52.
What Is Not Included in our Cost Analysis
The total materials and manufacturing costs reported in this analysis reflect ONLY the direct materials cost (from component vendors and assorted EMS providers), AND manufacturing with basic test. Not included in this analysis are costs above and beyond the material manufacture of the core device itself - cost of intellectual property, royalties and licensing fees (those not already included into the per component price), software, software loading and test, shipping, logistics marketing and other channel costs including not only EMS provider and the OEM's margin, but that of other resellers. Our cost analysis is meant to focus on those costs incurred in the manufacture of the core device and in some circumstances the packaging and literature as well.
Country of Origin / Volume Assumptions
Based on device markings, we've based our analysis with the final assembly in China. Furthermore, we have assumed that custom mechanicals (plastics, metals, etc.) were also sourced in China.
Country of origin assumptions relate directly to the associated cost of manufacturing, where calculated by iSuppli. In the cases of 'finished' sub-assemblies (such as wall power charger), we do not calculate internal manufacturing costs, but rather assess the market price of the finished product in which case country of origin assumptions may or may not have a direct effect on pricing.
Remember also that labor rates are applied directly only to hand inserted components and systems in our bill of materials, and although regional assumptions do, these new rates do not have a direct effect on our modeled calculations of placement costs for automated SMD assembly lines. "Auto inserted components (such as SMT components) placement costs are calculated by an iSuppli algorithm which allocates a cost per component based on the size and pincount of the device. This calculation is affected by country or region of origin as well.
Design for Manufacturing / Device Complexity
The Netgear FS116 is simple and straightforward to manufacture - in fact, it's a lot like automotive modules we see which are composed of one PCB, and a two-piece metal enclosure. In such assemblies - the main cost of manufacturing is the automated 'pick-and-place' or surface mount assembly. Hand assembly then is simply integrating the PCB into the two-piece enclosure with screws, etc. The grand total component count for the whole FS116 is 544 components, which in the grand scheme of our teardown universe, and based on the 'PCB + simple enclosure' design, makes this design relatively simple and low cost to manufacture, regardless of country of assembly (especially since so little hand assembly or labor is involved).
Component counts have a direct bearing on the overall manufacturing cycle times and costs, and also can increase or decrease overall yields and re-work. Our calculations of manufacturing costs factor counts and more qualitative complexities in the design.
Note that manual labor has a much smaller effect on auto-insertion assembly lines (for the Main PCB, for example), where manufacturing costs are much more capital equipment intensive and driven by these investment costs.
The Netgear FS116 is based, like other switches we have torn down, on a cascaded or pyramidal IC structure in which two 8-port transceivers (BCM5288) are controlled by a single 16-port switch controller (BCM5310). The chips in the design are very old - circa 2003 and 2004 from Broadcom (the Netgear FS116 is pretty old too with a 2007 release), and are mature, though in the area of Ethernet comm. chips the life cycles are long and don't undergo the same fast-moving pace of advances. Aside from the Broadcom core - there is little else going on in this design from an active component (IC and semiconductor) point of view.
Here is a summary of the major components used in the Netgear FS116 design:
Broadcom - BCM5310KQMG - Ethernet Switch Controller - 10/100Mbps, 16-Port
I/O & Interface
Broadcom - BCM5288UA0KQMG - Ethernet Transceiver - 10/100Mbps, 8-Port