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POWER4 is horribly expensive right now because it is a top end server unit. I say unit because it is not a chip, it is a selecetion of at least 5 large expensive chips, 4 Dual code CPUs + Cache all in a metal case with thousands of pins and requires several tons of pressure to seal. Being in an expensive market they are made in very small numbers so don't have the benefits of mass manufacture.
They are not going to put one of these things in a Mac unless Apple decide to start chasing the high end Unix market.
Take just one of these chips, shrink it to 0.13um and churn them out by the thousands and you've cut the costs right down. Changing the L2 to slower (but higher capacity) L2 will reduce performance but could cut costs, Apple already use external L3. Cutting one of the CPU corse out will save about 1/4 of the silicon but drasticly reduce costs.
Remember IBM will do this for their workstations anyway and they will use it to counter the Itanium 2 which will probably appear in the same price range as top end Power Macs. Apple get a nice new fast processor and IBM with the higher volume have a stick to beat Intel with.
Workstation processors always start off horribly expensive but also tend to be followed with much cheaper cut down versions - Sun have a low cost version of the US3 on the way...
I think it would be a smart move for Apple as they would be able to do away with all the G4 is too slow complaints which probably don't effect their core markets much but does deter PC users from switching. Personally I think switching to DDR and improving the speed of the OS will show the G4 is a more capable chip than can currently be measured.
Whether they do this or not we have yet to see but Apple does have this option and unlike Motorolas G5, POWER4 is not as some folks put it "vaporware".