$8 including packaging and taking the yield into account? That's impressively low.
The mark up on the higher end is taking the mick though. It's not as if that high end is actually very high end, indeed it's just about bearable because of design tradeoffs to achieve very low power consumption. I bet that OEMs will cut deals though.
This CPU will "only" be used in a few million devices before it is replaced though. It also took a team of people 4 years to develop. Per-chip development costs could run to a few dollars imaginably. Then there is marketing. And myriad other costs.
The Diamondville Atoms will be cheaper though. Part of the markup is the tiny tiny package these Atoms utilise.
