16GB iPhone 5 bill of materials estimated at $168
Driven by the new A6 processor, LTE 4G high-speed modem and Retina display with in-cell touch technology, the new iPhone 5 is estimated to cost Apple $167.50 in materials alone for the entry-level 16-gigabyte model.
The numbers, published on Friday by UBM TechInsights, peg the cost of the new A6 chip at $28, making it the most expensive component in the new iPhone 5. The new, larger 4-inch display was valued at $18, plus another $7.50 for the touchscreen and cover glass.
The new 4G LTE modem from Qualcomm is also one of the most expensive components of the device, estimated to cost $25 by UBS.
The new, thinner camera is also valued at $10, while the NAND flash is $9, and SDRAM is $4. The handset's Wi-Fi, Bluetooth and GPS chip is estimated to cost $4.
Of course, the bill of materials for the iPhone 5 does not include the research and development costs Apple invested in the hardware, as well as development of iOS, or the cost to assemble, package and ship the handset. The 16-gigabyte iPhone 5 is available for $199 with a new two-year service contract.
The UBS data is based on assumptions about the device that cannot be verified because the hardware has not been analyzed. The research firm presumes the new A6 processor has a gigabyte of RAM, and that the internal battery is 1,400 mAh.
For comparison to the iPhone 5, UBS estimates that the 16-gigabyte iPhone 4S, which sells for $99, has a bill of materials of $132, while the iPhone 4 is valued at $112.
The numbers, published on Friday by UBM TechInsights, peg the cost of the new A6 chip at $28, making it the most expensive component in the new iPhone 5. The new, larger 4-inch display was valued at $18, plus another $7.50 for the touchscreen and cover glass.
The new 4G LTE modem from Qualcomm is also one of the most expensive components of the device, estimated to cost $25 by UBS.
The new, thinner camera is also valued at $10, while the NAND flash is $9, and SDRAM is $4. The handset's Wi-Fi, Bluetooth and GPS chip is estimated to cost $4.
Of course, the bill of materials for the iPhone 5 does not include the research and development costs Apple invested in the hardware, as well as development of iOS, or the cost to assemble, package and ship the handset. The 16-gigabyte iPhone 5 is available for $199 with a new two-year service contract.
The UBS data is based on assumptions about the device that cannot be verified because the hardware has not been analyzed. The research firm presumes the new A6 processor has a gigabyte of RAM, and that the internal battery is 1,400 mAh.
For comparison to the iPhone 5, UBS estimates that the 16-gigabyte iPhone 4S, which sells for $99, has a bill of materials of $132, while the iPhone 4 is valued at $112.
Comments
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surely, you mean the new A6 processor.
Quote:
Originally Posted by AppleInsider
Driven by the new A5 processor, LTE 4G high-speed modem and Retina display with in-cell touch technology, the new iPhone 5...
Does ANYONE proofread?
"APPLE IS OVERCHARGING. MONEY-GRUBBING FOOLS. SEE HOW YOU LIKE IT, ISHEEP."
? Also, to the two posts above, check my signature. Thanks for the catch! ?
Quote:
Originally Posted by Tallest Skil
? Also, to the two posts above, check my signature. Thanks for the catch! ?
Ah, now we know. Thanks.
Add in the cost of the years of research and development of the phone and OS, assembly, shipping, marketing, ect. . . . I'd say the asking price of $650 is MORE than fair. But i'll wait for the haters to stroll in and proclaim how their plastic Android phone is so much better for the price. . . . .
Quote:
Originally Posted by SWS
Add in the cost of the years of research and development of the phone and OS, assembly, shipping, marketing, ect. . . . I'd say the asking price of $650 is MORE than fair. But i'll wait for the haters to stroll in and proclaim how their plastic Android phone is so much better for the price. . . . .
It's more than fair, but one thing ALL OEMs are guilty of are the $100 markups between 16-32-64-whatever. I'll never understand that.
delete
Quote:
Originally Posted by thataveragejoe
It's more than fair, but one thing ALL OEMs are guilty of are the $100 markups between 16-32-64-whatever. I'll never understand that.
It all depends on which chips Apple is using. You can buy a 32GB chip for $10 or you can get one for $150. I'd imagine Apple is NOT using the cheapest RAM available.
Is that high or low? What proportion of the overall selling cost (to carriers or unlocked at retail) is it, compared to other models. Some perspective would not hurt, in this article.
Quote:
Originally Posted by CheckThat
It would be interesting to know where they get these "valued at" prices from. I would imagine Apple is able to get unheard of pricing on components, labor, etc.. It would not surprise me if they build each phone (including labor, shipping, etc.) for around $80 each.
I'm not sure that its fair to make a claim like that without knowing anything about wholesale pricing. It wouldn't surprise you that they save 50% on every phone? That's a huge margin to save simply because they're a component supplier's biggest customer.
There was a study in the Economist some months back that suggested that essentially all smartphones cost between $160 and $180 to make when new. The glass and aluminum don't seem to actually drive up the component cost much (though I suspect they sharply increased the production cost in other ways: factory equipment, etc.).
Have NAND prices really not fallen in the past two years? It seems prices for everything have only gone up.
Time to let the perpetual myth spread that to create a device all you need is a magic bag of parts! No R&D, no staff or rent or insurance to pay, no developing manufacturing processes and building equipment, no sourcing and transportation of components, no packaging, no software, no testing, no developer tools, no licenses and patents, no marketing budget, no warranty service, no customer support, just an idea “iPhone 5!” and a bag of parts appears by magic and assembles itself for you to mark up.
Quote:
Originally Posted by thataveragejoe
It's more than fair, but one thing ALL OEMs are guilty of are the $100 markups between 16-32-64-whatever. I'll never understand that.
I'll never understand how midgrade and premium gas is always 10c and 20c more than regular. 3.69-3.79-3.89. Back in the old days: .79-.89-.99. Go figure.
Quote:
Originally Posted by SWS
Add in the cost of the years of research and development of the phone and OS, assembly, shipping, marketing, ect. . . . I'd say the asking price of $650 is MORE than fair. But i'll wait for the haters to stroll in and proclaim how their plastic Android phone is so much better for the price. . . . .
I'm sure Apple (and other manufacturers) love to see people posting how it's "MORE than fair!11!" while they're handing over a cool $500 to add to the Apple cash pile. How is it fair again? Years of R&D? Years? Seriously? If you consider that every new model of the iPhone is an incremental change, building on the R&D of the previous generation, you'll realize that there about a YEAR of incremental R&D (maybe less than a year), building upon the previous generation's hardware and software.
So let's see.. if everyone is buying 16GB (some people are paying more, for the larger capacity), that's $500x50 million phones is $25 BILLION. For a year of research. That's assuming they won't sell more. With that kind of cash this thing should also enable time travel.
Apple's stuff is cool and all, but they are laughing to the (overseas tax haven) bank with your money.
Quote:
Originally Posted by thataveragejoe
It's more than fair, but one thing ALL OEMs are guilty of are the $100 markups between 16-32-64-whatever. I'll never understand that.
They do it because they can. Because people will pay $100 more for $5 worth of hardware. What kind of business wouldn't take that sweet deal?
Quote:
Originally Posted by ColorClassic
I'll never understand how midgrade and premium gas is always 10c and 20c more than regular. 3.69-3.79-3.89. Back in the old days: .79-.89-.99. Go figure.
It's not like that anymore (around here anyway). In my area premium is .15-.20 more than plus. The reason the gap hasn't widened faster is because the cost to produce higher octane has not increased at the same rate as the price of oil. All the grades come from the same oil and the base price of that oil has increased quite a bit since the old days.
Parts are just one percentage of the cost for a company to get its product into your hands. How many hundreds of millions (if not billions) of dollars were invested to create and test new manufacturing processes for this phone? How about paying thousands of employees over the course of 2 years to design and engineer it? R&D required to shrink and optimize every single chip and component inside the phone? Assembly costs? Marketing? Shipping? Distribution? Logistics? I have no doubt Apple is making a healthy profit margin. But that margin is partly because they're the most efficient in the business, and will end up selling hundreds of millions of these phones. They're masters of the supply chain. They prebuy massive amounts of components. heir margins doesn't mean you're getting less for your money than with any other phone- it just means that Apple is better at running its business. Quite the opposite. The S3 is in the same price range. I've handled it quite a bit, in terms of build quality, its from another universe. Pentile screen, super cheap, flimsy, thin plastic. There's nothing high end about the materials or quality, yet it sells for the same. I very much doubt anyone could build the same phone that Apple just build, and not charge more.