Thank you very much guys. This is extremely helpful. So can we walk through this to make sure I'm understanding and maybe someone can correct or fill in gaps (there is a reason why I'm belaboring this)?

So first a cpu architect or electrical engineer designs an ASIC card using a software program. Are the ASIC designs patent-protected or are they all pretty much similar? I read something about intellectual property on the Butterfly Labs site, does this come in to play here and if it does how?

When this ASIC design is done by an engineer, the software is sent to a company such as Open-Silicon for them to mass produce your product? Now you have physical hardware that you then send to a company like Global Foundries. They make the chipsets to fit the specs of your hardware.

Also, where does this assembling come into play? I heard in an interview about how the CEO of Butterfly Labs wasn't so comfortable outsourcing because it took them awhile to put things together right. He mentioned how you have to put the chips in and glue/insulate(?) them at a certain temperature. You gotta screw in the heatsink with a certain amount of torque. He said all of these things were done within his lab at first but that he had to outsource a little to keep up. So you get the finished hardware from Global Foundries and then you still have to put some chips in? I got confused here. Thank you all.