One design can become several products
A chipmaker does not always need a separate design to offer a slower or less capable processor at a lower price. It can manufacture a chip with a broad set of features, then sell some units with selected parts disabled. Those parts might include processing cores, cache memory, or graphics capabilities, depending on the chip.
The restriction can be built into the chip during production. A tiny, permanent setting called a fuse can mark a feature as unavailable; in other products, firmware or configuration controls what the chip exposes. The result is a lower-tier model that shares much of its underlying design with a more expensive one.
Testing turns manufacturing variation into inventory
After fabrication, chips are tested to see how they perform and whether their components work reliably. No manufacturing process produces perfectly identical units every time. If one section fails testing, a company may be able to disable that section and sell the remaining chip as a reduced model rather than discard it.
But not every cut-down chip is a defective one. Makers may also disable working features to create distinct price levels. That lets them serve buyers who need basic performance while reserving the full-featured version for customers willing to pay more.
The tradeoff is price versus capability
This approach can lower costs because the company can build several products from related designs and, in some cases, recover value from chips that would otherwise be unusable. Buyers get a cheaper option, but usually cannot restore a disabled feature later: the restriction may be permanent, and the product is sold and supported as the lower-tier model.
The economic trick is that the same piece of silicon can serve different markets. A feature a budget buyer does not need becomes a reason to charge less, while its availability in the premium model helps justify the higher price.
