This teardown is of the Dell PowerEdge R710 which is a 2U rack server, with 2 processor sockets (Intel Xeon 5500 and 5600 series). As with most servers, and teardowns of servers, there are a lot of client-configurable options, so the cost assessment we are doing is only valid for this specific configuration. Having said that, we have rolled up the numbers in ways that should match the way a client would buy the system (and options) from the supplier - Dell in this case. Though it's not normally part of the teardown analysis, we have provided a client-specific analysis here that is designed to answer not just the question of 'what are the component costs that going into the system', but what are the subsystem totals and markups that tend to stack up along the way that ultimately add up to a price to the end buyer.
Based on data sheet copyright date.
Dell pricing configurator was used to produce nearest possible cost to configuration torn down.
5,000 Total Units
5 Total Years
For the purposes of this teardown analysis, we have assumed an Annual Production Volume of 5000 units and a Product Lifetime Volume of 5 year(s).
Teardown volume and 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.
Our normal methodology for compiling top cost drivers does not apply here, and we have produced roll ups that more closely emulate the modules and options that end-buyers would be able to buy or negotiate. As an example of what this means, we assume that end-buyers will be more interested in negotiating NIC cards, or RAID controller cards, for example, instead of individual ICs.
We do not normally account for logistics costs or 'other' costs beyond basic electronic systems and EMS-Level Assembly, teardowns are hardware cost focused. But in order to better chart the cost links in the supply chain, and how that might affect end-buyers we have created a simplified supply chain (in the 'System Cost Analysis' Tab) with rough mark up assumptions (which also should account for logistics cost) between the parties to better account for where our BOM costs are in the grand scheme of 'total cost', or price to the end customer.
The total price of the system above as configured - came to $10,606. By the time pricing analysis was being performed Dell had already changed available configurations, and the Intel processor in this teardown was not a configurable option. In fact - the nearest configuration we found - with an Intel X5660 processor (as opposed to the X5650 in this analysis) came to a configured total of $9086 with a promotional discount to come to $8464. This $8464 configuration should be $500 to $600 MORE than the configuration we tore down.
At every level of assembly built here - there is potentially a different country of origin and different EMS providers involved. Dell works with many of the largest EMS providers in the world including Hon Hai (Foxconn), Flextronics, Inventec, Mitac, and others. For the purposes of our analysis, we assume equal economies of scale and efficiency across EMS providers.
Also, in the case of a system like this, some 'external' (PCI) cards may come from external sources, and in some cases, will not be built to a Dell design spec, but rather are 'off the shelf' designs from 3rd parties like Broadcom, Intel and others (who themselves have such cards built also by EMS providers).
In cases where we are not able to identify who the manufacturer is of a card, we still account for EMS manufacturing and markups in the table above.
Country of Origin
For the purposes of this analysis, we are assuming the following country(ies) of origin for each level of assembly, based on a combination of 'Made In' markings, and/or assumptions based on our knowledge of such equipment.
BMC Memory Module - China
Box Contents - China
Misc PCB Assemblies - China
Motherboard - China
Other - Enclosures / Final Assembly - China
Storage Device - 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 hard drives or DIMM modules), 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.
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.
Component counts by assembly and the number of assembly are indicators of design complexity and efficiency.
Component Qty: 3955 - Motherboard
Component Qty: 5 - Storage Device
Component Qty: 255 - Other - Enclosures / Final Assembly
Component Qty: 2015 - Misc PCB Assemblies
Component Qty: 41 - Box Contents
Component Qty: 39 - BMC Memory Module
Component Qty: 6310 - Grand Total
Servers are inherently complex, and this design is inline with the complexity of most other servers we have seen. Servers do not need to push the envelope on design densities - they can bolt on as many components as they need to serve the functions needed. This Dell is in line with competing solutions from HP and others from our perspective - but 6310 components in all - make this system one of the largest we have ever analyzed in detail in terms of raw scale.