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Components of 16GB iPhone 4 estimated to cost Apple $188

post #1 of 24
Thread Starter 
A breakdown of the components that make up Apple's iPhone 4 has found that the most expensive item in the device is its high-resolution Retina Display, with an estimated price of $28.50.

As first reported by Businessweek, iSuppli's teardown of the iPhone 4 found that the components inside cost an estimated $187.51. Apple's latest phone starts at $199 with 16GB of internal memory and a two-year service contract in the U.S. The cost breakdown applies to the 16GB iPhone 4.

The most expensive component is the highly touted Retina Display found on the iPhone 4. Supplied by LG Display, the component costs $28.50, iSuppli said. The custom-built A4 processor, assembled by Samsung, cost an estimated $10.75.

The newly added gyroscope in the iPhone 4 was said to cost another $2.60, in addition to the 65-cent accelerometer found in the current phone as well as previous models. The new gyroscope is made by STMicroelectronics of Geneva.

Other suppliers of the internal hardware include touch-sensitive panels from Wintek and TPK, and chips from Skyworks Solutions and TriQuint Semiconductor.

Neither Apple nor its carrier partners would comment on how much is paid by wireless providers for the unsubsidized handset. Historically, the average selling price of previous model iPhones has been around $600.

The total estimated cost is slightly higher than the iPhone 3GS, first released last year. The 2009 handset cost an estimate $179 in parts for Apple.

In fact, the price of Apple's phones has been steadily increasing over the years. In 2008, iSuppli found that the iPhone 3G carried a components cost of $174.33.

TechCrunch notes in its coverage of the report that "iSuppli is well-known for low-balling these numbers in an effort to convince manufacturers to contact them in order to connect with their preferred suppliers, so grains of salt must be taken."
post #2 of 24
I Want one ohhh im 1st
post #3 of 24
"The newly added gyroscope in the iPhone 4 was said to cost another $260,"

"$260" ? is that a typographical error?
post #4 of 24
That's a good price if the gyroscope alone costs $260!
post #5 of 24
Quote:
Originally Posted by powerhub View Post

"The newly added gyroscope in the iPhone 4 was said to cost another $260,"

"$260" ? is that a a typographical error?

You gotta figure they meant $2.60
Progress is a comfortable disease
--e.e.c.
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Progress is a comfortable disease
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post #6 of 24
Quote:
The newly added gyroscope in the iPhone 4 was said to cost another $260, in addition to the 65-cent accelerometer found in the current phone as well as previous models. The new gyroscope is made by STMicroelectronics of Geneva.

Sorry, what?

~Callum

EDIT: Didn't read posts above, I lose
post #7 of 24
Note just a $260 gyroscope. Check out the old component cost: $17.4.33. That's a good price on any planet.
post #8 of 24
Quote:
Originally Posted by AppleInsider View Post

A breakdown of the components that make up Apple's iPhone 4 has found that the most expensive item in the device is its high-resolution Retina Display, with an estimated price of $28.50.

The newly added gyroscope in the iPhone 4 was said to cost another $260…

For those questioning the cost, did they or anybody else including the author, Katie Marshal who wrote this piece, bother to read or check the real article?
Quote:
A component new to the iPhone is a gyroscope chip designed to detect how the phone moves in three dimensions and to make playing games seem more realistic. ISuppli said Geneva-based STMicroelectronics (STM:FP) supplied the gyroscope chip at an estimated cost of $2.60, as well as an accelerometer chip used in previous iPhone versions, which has an estimated cost of 65¢.

http://www.businessweek.com/technolo...627_763714.htm


post #9 of 24
Does an ingenious OS and flawless industrial design account for anything, Mr. Bean?
post #10 of 24
Quote:
Originally Posted by MJ Web View Post

Does an ingenious OS and flawless industrial design account for anything, Mr. Bean?

Flawless = perfect, faultless, works with no issues.

So, does the iPhone 4 fall into this? Well, i'd say the whole 'dropped calls because you hold it in your left hand' thing would imply no.

'Oh, but you have to hold it in a certain way'. Yeah, right. Its a phone, I want to hold it in my hand anyway I choose to.

In some ways, i`d say the new iPhone was designed by Mr Bean!
post #11 of 24
Lol, By The Time I Registered The Spelling Was Corrected, Good Job.
post #12 of 24
Quote:
Originally Posted by mgoodman View Post

Note just a $260 gyroscope. Check out the old component cost: $17.4.33. That's a good price on any planet.

They should only charge 43.114.$.621 for retail price, based upon component costs.
post #13 of 24
Quote:
Originally Posted by RabidRabbit View Post

Flawless = perfect, faultless, works with no issues.
...


And the thinnest industrial design would not work without a thick skin!!
post #14 of 24
Quote:
Originally Posted by MJ Web View Post

Does an ingenious OS and flawless industrial design account for anything, Mr. Bean?

As has been discussed ad nauseum every time this type of report comes out - the numbers provided are the individual component cost of the parts - not the total cost to Apple of production including R&D - Software - shipping - marketing etc.

Kinda of like looking up the cost of a set of brake pads on eBay for your BMW vs dropping your car off at the BMW dealer to have the brakes replaced. (or any dealer really). would you expect the car dealer to instal your brake pads as the same price for which you could buy the same set of pads yourself?

or an oil change anywhere - including the quickie places - would you expect to pay a service provider to change your oil exactly the same as the purchase price of the oil at Wal-mart?
post #15 of 24
This is the ugliness part that no Apple fan wants to admit. They are making twice as much on iPhone sales because they are charging AT&T the unsubsidized price. This is routine for all hardware makers. I suggest that others read the NYT article about how the materials used for computers are being treated like blood diamonds. People are being slaughtered.

Being Made in the USA is the best way to be certain that you're money isn't going to fund murderers.

Jobs, I hope you're listening. You're better than the rest and they will follow your lead. People will pay more to know their money is going towards a purpose.
post #16 of 24
Quote:
Originally Posted by quinney View Post

They should only charge 43.114.$.621 for retail price, based upon component costs.

They can't. They have a margin of 042.$ they need to hit on every unit.
post #17 of 24
I don't know why you guys go on about this. It's not the components we're buying, just like you're not buying just the door handles, the paint color or the suspension of your new Porsche, or even the brake pads on your Beemer. It's about the aggregate form, the function, the style, the badass look, the over-the-top coolness factor of owning the newest and best. That's what you're paying for, not the gyroscope, the wrap around antenna or anything else contained in or on this device that's a so-called 'part.' I can tell you this: if it weren't for the AT&T connection, I'd feel 'way better than I do about mine.
post #18 of 24
Quote:
Originally Posted by RabidRabbit View Post

So, does the iPhone 4 fall into this? Well, i'd say the whole 'dropped calls because you hold it in your left hand' thing would imply no.


which doesn't happen to 100% of the people 100% of the time. In fact, it's probably only perhaps 1-2% of the units sold that it happens at all and perhaps 50% of those with any regularity.

And it's not an issue unique to the iphone 4. fair number of those reporting this 'design flaw' admit it happened with their previous iphones or non iphone units.

As for this price breakdown, as always it just looks at the physical parts and neglects licensing etc for the needed patents. Show me that before you talk about how much of that $599 retail is profit due to how 'cheap' the phone is to build
post #19 of 24
Quote:
Originally Posted by str1f3 View Post

This is the ugliness part that no Apple fan wants to admit. They are making twice as much on iPhone sales because they are charging AT&T the unsubsidized price. This is routine for all hardware makers. I suggest that others read the NYT article about how the materials used for computers are being treated like blood diamonds. People are being slaughtered.

Being Made in the USA is the best way to be certain that you're money isn't going to fund murderers.

Jobs, I hope you're listening. You're better than the rest and they will follow your lead. People will pay more to know their money is going towards a purpose.

There's a huge difference between iPhones and diamonds...although both are shiny.

The best thing you can to in regards to iPhones (and other consumer devices) is to put pressure on the companies to make sure that they improve wages, work and living conditions; and to make sure they're sourcing material or contracting with manufacturers who are sourcing material in ways that aren't evil or feed into evilness.

Diamonds on the other hand are much different. They're much more like Ivory Tusks. Diamonds have very little real value other than there's a market of women who think they're shiny and don't care how many people were raped, tortured terrorized, and murdered so they can have the shiny rock on their hand. While there is an actual utility use for diamonds, that demand can be met cheaper from better quality fake diamonds...for that matter with current technology even the needs of egotistical women can be better met with modern fake diamond technology.

Since diamonds have little utility and they're mostly just price supported through Debeers and a handful of others that control the industry, the best thing you can do is simply not buy *any* diamond.

Fortunately with material sourcing, we're already starting to see huge global changes. However while "Made in the USA" may make a difference in terms of work conditions, living wage, etc...it won't make any difference in where materials are sourced from or the conditions by which they're sourced.
post #20 of 24
Quote:
Originally Posted by str1f3 View Post

This is the ugliness part that no Apple fan wants to admit. They are making twice as much on iPhone sales because they are charging AT&T the unsubsidized price. This is routine for all hardware makers. I suggest that others read the NYT article about how the materials used for computers are being treated like blood diamonds. People are being slaughtered.

Being Made in the USA is the best way to be certain that you're money isn't going to fund murderers.

Jobs, I hope you're listening. You're better than the rest and they will follow your lead. People will pay more to know their money is going towards a purpose.

The safest thing for any Western consumer to do, then, is to buy nothing that is made outside of one's country, and even then, you had better research deeply into the practices of each company because sweatshops exist in Europe and North America too.
32" Sharp AQUOS (1080p) > 13" MacBook Pro 2.26GHz. 4Gb RAM . 32Gb Corsair Nova SSD >>> 500Gb HDD
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32" Sharp AQUOS (1080p) > 13" MacBook Pro 2.26GHz. 4Gb RAM . 32Gb Corsair Nova SSD >>> 500Gb HDD
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post #21 of 24
I was asking a person at AT&T about replacing an iphone 4 without insurance and he said $600. That should be the unsubsidized price
post #22 of 24
Quote:
Originally Posted by AppleInsider View Post

As first reported by Businessweek, iSuppli's teardown of the iPhone 4 found that the components inside cost an estimated $187.51.

The UK handset price is £499 so without tax is £425, which is $641.

So they would stand to make over $400 per handset - probably over $1 billion this week alone. It's not surprising really given that in 3 years they make the most revenue out of any mobile phone company.

There are obviously other costs like R&D and Steve's dry cleaning bill to get the same outfit ready every day but there's still a lot of profit at that price point.

Imagine how many they'd sell if they only took $100-200 per handset.

If they can't handle the demand right now, it would be anarchy if they dropped the price that much.
post #23 of 24
Quote:
Originally Posted by Marvin View Post

The UK handset price is £499 so without tax is £425, which is $641.

So they would stand to make over $400 per handset - probably over $1 billion this week alone. It's not surprising really given that in 3 years they make the most revenue out of any mobile phone company.

There are obviously other costs like R&D and Steve's dry cleaning bill to get the same outfit ready every day but there's still a lot of profit at that price point.

Imagine how many they'd sell if they only took $100-200 per handset.

If they can't handle the demand right now, it would be anarchy if they dropped the price that much.

That's exactly what I was thinking. The article compares the price of the phone against the "handset price" you pay up front on a contract, which is pointless because you carry on paying for the handset all the way through the contract.

The profits do look on the large side to me, but then when I go to my local phone shop I don't see Android units coming in much cheaper - if at all.
post #24 of 24
Such figures are very misleading since they completely ignore the costs of R&D, design, manufacturing, developing the software, shipping, retail expenses, customer support and so forth.

Someone has to do all these things and to leave them out of the equation is to miss the most important parts of the equation. Without these things all you have is a useless collection of electronic components.
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