That would be like saying that your first dinner in a new house cost $250,000.00, when you factor in the cost of buying the house...
It is not a method which yields useful information.
The guy did say "the costs for most of the above are already accounted for in previous years books".
It is just a interesting mental exercise.
5m iPads - then the cost of buying in expertise and developing the chip costs $60 a device.
50m devices - then the cost is $6 a device.
300m devices - then the cost is $1 a device.
It isn't hard to contemplate that one year's combined iPad, iPhone and iPod touch sales could hit the 50m mark.
You then have to pit the cost against using whatever SoC that Samsung would have sold Apple instead. The current A8 SoC is $15 according to iSupply, but an A9 SoC would have cost more anyway. Also it wouldn't have been an exact match, or have any Apple IP or tweaks included. I don't know if in these terms Apple would ever get their money back, but being in control is probably worth it for them.
That would be like saying that your first dinner in a new house cost $250,000.00, when you factor in the cost of buying the house...
It is not a method which yields useful information.
Except you can sell your house and get your money back. And that you probably didn't pay cash up front for your house. And that you would be eating meals regardless of the price of the house you live in. And that you don't buy a house just to eat meals in. This analogy yields nothing.
Maybe a commodity product but generally that is not a healthy sign for business. Look at Detroit of the computer memory business and convince me that is a good thing for those businesses.
I'm not going to try to convince you of anything, especially not an assertion that I neither made nor would make.
Quote:
Originally Posted by wizard69
Nope it is an exercise in stupidity if you are not aware of and understand what is being accounted for. Do you really think Apple could have come up with iPhone and the whole iPod lineup without without hefty markups on it's Macs and other hardware and software? How else would they have paid the engineers wages and the management staff in R&D.
Seemingly, you did not understand what I said.
Quote:
Originally Posted by wizard69
Frankly your mentality is very destructive to the economy as a whole.
Yep - This confirms that my statement of fact went over your head. If you look up "Marginal Concepts" on wikipedia there's lots of good articles on related topics.
At this point there are 63 posts. Of which 17 are either posted by teckstud or a response to one of his ravings. That's more than 25% of the thread (which is actually low for him).
Personally, I have him on ignore, but it doesn't work if everyone replies to his inanities which is exactly what he wants anyway. He's an attention whore.
If everyone added him to their ignore list, the forum would work a lot better. Please?
You then have to pit the cost against using whatever SoC that Samsung would have sold Apple instead. The current A8 SoC is $15 according to iSupply, but an A9 SoC would have cost more anyway. Also it wouldn't have been an exact match, or have any Apple IP or tweaks included. I don't know if in these terms Apple would ever get their money back, but being in control is probably worth it for them.
I suspect that Apple has big plans for PA Semi and will make a killing on the purchase, compared with buying chips elsewhere.
Except you can sell your house and get your money back. And that you probably didn't pay cash up front for your house. And that you would be eating meals regardless of the price of the house you live in. And that you don't buy a house just to eat meals in. This analogy yields nothing.
Those types of things are equally true for the PA Semi purchase. That's kinda the whole point of the analogy: The method yields no useful information.
Apple's operating margin in general is about 30% and their net profit margin is 20%. I think this device should fall pretty much in line with those numbers.
Actually Jason, I think that Apples operating Margin on the iPhone/iPod Touch and Ipod family is much smaller than 30%.
Their operating margin for PCs was close to 50% in the late 90s, and has gone down to the 30% you cited (as opposed to the 5ish%(or less) of most PC box pushers), but I believe the iPhone/iPod product lines are in the 10% to 20%, wish I could find my source tho'. :-( If you have a source, please, I'd like to read it.
but I think that at $499, they will be straining to reach 30%.
Generally, selling prices trend towards the marginal cost of production.
Just one example of why comparing the component costs to the sale price is an exercise in enlightenment.
Sure, they "trend" that way... AFTER you've recouped the cost of R&D, manufacturing ramp up, etc.
I think one reason why Apple dropped the price of the iPhone after its introduction wasn't because people were complaining about the price or because sales were slow (they weren't). But rather it was because they didn't know until AFTER the iPhone was release how well it would sell. And once they realized they could spread the cost of R&D over a larger number of units, they were able to lower the price.
So until they know how many iPads they'll sell, it's impossible to know how much revenue each unit needs to bring in to cover the non-manfacturing costs that iSuppli never accounts for.
Apple spends a lot time time refining their products, sometimes years before anything is ever sold. That time isn't exactly free!
Machines do work cheap that is why factories are made up of machines. You have heard of Ford and his assembly line, right?
Yea that's only half the story, Ford increased the workers pay so that they could afford to buy a car.
Quote:
First off Apple employees a lot of people in the US and is currently building another campus to higher even more. The money to employ those people comes from the cash between the 219 number and Apples $499 price. The $219 number is the cost to build and has nothing to do with running Apple, it's engineering departments or any of the other common business expenses.
Obviously I meant that I hope Apple employs more people with iPad margins that high.
Quote:
You must be a very left leaning Democrate.
That's a insult to my intelligence, and yours, because you misspelled Democrat.
Quote:
You see what they have on offer and buy based upon the item meeting your needs. It is an exchange that you are free to avoid.
I understand how the free market works, I also understand, like Henry Ford did, that in a robust economy, money circulates from consumer to business to consumer and business again, round and round. The faster it goes, the better it is for everyone.
Last time I checked, Apple had 30 or so BILLION dollars in cash, what is that money doing? Is it contributing to the jobs the economy needs which Apple depends upon?
Those types of things are equally true for the PA Semi purchase. That's kinda the whole point of the analogy: The method yields no useful information.
HTH.
They aren't really the same thing at all.
Apple paid in full up front, nearly a third of a billion dollars, for something that they would receive no immediate return on, and potentially no return at all.
With your house, you can live in it straight away, you probably bought it on a mortgage, and every month you live in it is a month of rent you aren't paying elsewhere. Since Apple bought PA it has been all cost, no return, and no savings - they have still been paying for other peoples designs in the meantime.
It's like renting a place out, paying up front in full for a new house that you can't live in for 3 years, and which may prove to be a house of cards that is uninhabitable when you try to move in.
Now that's just a bout the dumbest thing I've read in a long time. Stupidity is not a saving grace, and neither is ignorance.
Well your lack of education isn't my problem.
The reality is I run into this sort of mentality everyday. That is people who expect a free ride, on the backs of the working people of this country, because they can't or won't go out and make a living. They take somebody making a profit off them as a personal insult or an attempt to screw them. Wether it is some old retired person complaining about the price of a cup of coffee they could have made themselves or some welfare mom whining about the costs of diapers, it is still a sign of a person with the assumption he is entitled to goods free of profit.
Now I'm sure many of you will say but they don't have the money. To which is say then screw them. You know what happens when I don't have money, I don't buy things. I don't go to the movies or sit at McDonalds for hours drinking coffee. It is all about personal responsibility and meeting your obligations in life.
Welfare is a perfectly good example of the issues we face as a society. Everyone fully understands that some, for whatever reason, can not function fully. Those are the people Welfare was original suppose to be inplace for. These days though we have a system that supports fully functional people whom are simply to lazy to work. It is culture of the entitled taken to the ultimate level, why work when I can have everything for free.
Sadly; as we can see in this thread, the culture of entitlement and ignorance is moving into the mainstream. The thought that the norm of a product costing more than the sum of it's parts, confuses and offends people that don't know anybetter. Hell there are people that think paying anything is to much effort but frankly these thieves aren't much different than those that object to profits of any kind.
At this point there are 63 posts. Of which 17 are either posted by teckstud or a response to one of his ravings. That's more than 25% of the thread (which is actually low for him).
Personally, I have him on ignore, but it doesn't work if everyone replies to his inanities which is exactly what he wants anyway. He's an attention whore.
If everyone added him to their ignore list, the forum would work a lot better. Please?
Here's (part of) the problem, and I'm not referring to anyone in particular here.
If I'm not mistaken, the posts of users you have ignored still show up, but their comments are collapsed. This creates a situation in which the user might be tempted to view the ignored post and then possibly respond to it. Ignored users' posts should not appear at all for those who have ignored them via User CP.
I'd like to see iSuppli do a "breakdown" analysis of the latest version of MS Office. Let's see: 10 cents to stamp the DVD (if even that) and about 5 cents to make the box it ships in. And how much do they charge for Office these days?
Just one example of why comparing the component costs to the sale price is an exercise in ignorance.
I don't want to put words in your mouth, but your post reads like you're blaming iSuppli for the (clearly widespread) misapplication of their manufacturing cost breakdowns.
From all the articles I've read, I've never seen iSuppli's analysts state (or even imply) that R&D, packaging, and marketing don't factor into the retail price. In fact, their original breakdown (from here) explicitly states: "Please note these cost estimates account only for hardware and manufacturing costs and do not include other expenses such as software, royalties and licensing fees."
I don't think it's iSuppli's fault that trolls with an axe to grind against Apple (or just the iPad) ignore all those other factors just so they can continue to bitch about something on the internet.
It's none of my business to know what Apple might have in the cost of a product ? none what so ever. Then you throw in that the prices you/they have, may well be wrong and it's all meaningless and none of my business.
If you want to put in there, Apples cost to operate their business daily, their cost for R&D, their cost to deal with all of the silly lawsuit they get each day, and the number of folks that are working because of Apple ? I MIGHT care this much more (very little).
If you have the time, I would like to know the cost for the following items I'd greatly appreciate knowing that I paid someone to make a profit on me
- Toyota Avalon
- Toyota Camry
- Panasonic 54" Plasma TV
- Pizza Hut Pizza
- Lottery Tickets I purchase each day
I KNOW there are more important things you could be doing, but it seems like you want to dig up dirt, so dig away.
Ignored users' posts should not appear at all for those who have ignored them via User CP.
The option like that in vBulletin is "Tachy Goes to Coventry" which is a global ignore list, though the site moderators can still see their posts. These posters won't even know their situation until they check the site from a logged out position to see that they are invisible.
TEKstud is typical New Yorker, paranoid as crap because always thinking someone is ripping him off, like to hear their own voice e.g., Donald Trump, or in his case, likes to publish as much BS comments, which majority of time, make no sense and just show, he practices the best verbal diarrhea for any person, i know in blogs, discussion threads etc.
To be frank you should get honorary PhD from Harvard Law School for your BS!
Please don't take it personal, accept your gift and use it wisely.
Comments
That would be like saying that your first dinner in a new house cost $250,000.00, when you factor in the cost of buying the house...
It is not a method which yields useful information.
The guy did say "the costs for most of the above are already accounted for in previous years books".
It is just a interesting mental exercise.
5m iPads - then the cost of buying in expertise and developing the chip costs $60 a device.
50m devices - then the cost is $6 a device.
300m devices - then the cost is $1 a device.
It isn't hard to contemplate that one year's combined iPad, iPhone and iPod touch sales could hit the 50m mark.
You then have to pit the cost against using whatever SoC that Samsung would have sold Apple instead. The current A8 SoC is $15 according to iSupply, but an A9 SoC would have cost more anyway. Also it wouldn't have been an exact match, or have any Apple IP or tweaks included. I don't know if in these terms Apple would ever get their money back, but being in control is probably worth it for them.
That would be like saying that your first dinner in a new house cost $250,000.00, when you factor in the cost of buying the house...
It is not a method which yields useful information.
Except you can sell your house and get your money back. And that you probably didn't pay cash up front for your house. And that you would be eating meals regardless of the price of the house you live in. And that you don't buy a house just to eat meals in. This analogy yields nothing.
Maybe a commodity product but generally that is not a healthy sign for business. Look at Detroit of the computer memory business and convince me that is a good thing for those businesses.
I'm not going to try to convince you of anything, especially not an assertion that I neither made nor would make.
Nope it is an exercise in stupidity if you are not aware of and understand what is being accounted for. Do you really think Apple could have come up with iPhone and the whole iPod lineup without without hefty markups on it's Macs and other hardware and software? How else would they have paid the engineers wages and the management staff in R&D.
Seemingly, you did not understand what I said.
Frankly your mentality is very destructive to the economy as a whole.
Yep - This confirms that my statement of fact went over your head. If you look up "Marginal Concepts" on wikipedia there's lots of good articles on related topics.
Personally, I have him on ignore, but it doesn't work if everyone replies to his inanities which is exactly what he wants anyway. He's an attention whore.
If everyone added him to their ignore list, the forum would work a lot better. Please?
You then have to pit the cost against using whatever SoC that Samsung would have sold Apple instead. The current A8 SoC is $15 according to iSupply, but an A9 SoC would have cost more anyway. Also it wouldn't have been an exact match, or have any Apple IP or tweaks included. I don't know if in these terms Apple would ever get their money back, but being in control is probably worth it for them.
I suspect that Apple has big plans for PA Semi and will make a killing on the purchase, compared with buying chips elsewhere.
Except you can sell your house and get your money back. And that you probably didn't pay cash up front for your house. And that you would be eating meals regardless of the price of the house you live in. And that you don't buy a house just to eat meals in. This analogy yields nothing.
Those types of things are equally true for the PA Semi purchase. That's kinda the whole point of the analogy: The method yields no useful information.
HTH.
Socialist are difficult people to understand.
Jackasses are difficult people to understand, too.
Apple's operating margin in general is about 30% and their net profit margin is 20%. I think this device should fall pretty much in line with those numbers.
Actually Jason, I think that Apples operating Margin on the iPhone/iPod Touch and Ipod family is much smaller than 30%.
Their operating margin for PCs was close to 50% in the late 90s, and has gone down to the 30% you cited (as opposed to the 5ish%(or less) of most PC box pushers), but I believe the iPhone/iPod product lines are in the 10% to 20%, wish I could find my source tho'. :-( If you have a source, please, I'd like to read it.
but I think that at $499, they will be straining to reach 30%.
Generally, selling prices trend towards the marginal cost of production.
Just one example of why comparing the component costs to the sale price is an exercise in enlightenment.
Sure, they "trend" that way... AFTER you've recouped the cost of R&D, manufacturing ramp up, etc.
I think one reason why Apple dropped the price of the iPhone after its introduction wasn't because people were complaining about the price or because sales were slow (they weren't). But rather it was because they didn't know until AFTER the iPhone was release how well it would sell. And once they realized they could spread the cost of R&D over a larger number of units, they were able to lower the price.
So until they know how many iPads they'll sell, it's impossible to know how much revenue each unit needs to bring in to cover the non-manfacturing costs that iSuppli never accounts for.
Apple spends a lot time time refining their products, sometimes years before anything is ever sold. That time isn't exactly free!
Please tell me how to ignore him....
User CP (toward upper left of forum window » Edit Ignore List (lefthand column)
Machines do work cheap that is why factories are made up of machines. You have heard of Ford and his assembly line, right?
Yea that's only half the story, Ford increased the workers pay so that they could afford to buy a car.
First off Apple employees a lot of people in the US and is currently building another campus to higher even more. The money to employ those people comes from the cash between the 219 number and Apples $499 price. The $219 number is the cost to build and has nothing to do with running Apple, it's engineering departments or any of the other common business expenses.
Obviously I meant that I hope Apple employs more people with iPad margins that high.
You must be a very left leaning Democrate.
That's a insult to my intelligence, and yours, because you misspelled Democrat.
You see what they have on offer and buy based upon the item meeting your needs. It is an exchange that you are free to avoid.
I understand how the free market works, I also understand, like Henry Ford did, that in a robust economy, money circulates from consumer to business to consumer and business again, round and round. The faster it goes, the better it is for everyone.
Last time I checked, Apple had 30 or so BILLION dollars in cash, what is that money doing? Is it contributing to the jobs the economy needs which Apple depends upon?
Those types of things are equally true for the PA Semi purchase. That's kinda the whole point of the analogy: The method yields no useful information.
HTH.
They aren't really the same thing at all.
Apple paid in full up front, nearly a third of a billion dollars, for something that they would receive no immediate return on, and potentially no return at all.
With your house, you can live in it straight away, you probably bought it on a mortgage, and every month you live in it is a month of rent you aren't paying elsewhere. Since Apple bought PA it has been all cost, no return, and no savings - they have still been paying for other peoples designs in the meantime.
It's like renting a place out, paying up front in full for a new house that you can't live in for 3 years, and which may prove to be a house of cards that is uninhabitable when you try to move in.
Now that's just a bout the dumbest thing I've read in a long time. Stupidity is not a saving grace, and neither is ignorance.
Well your lack of education isn't my problem.
The reality is I run into this sort of mentality everyday. That is people who expect a free ride, on the backs of the working people of this country, because they can't or won't go out and make a living. They take somebody making a profit off them as a personal insult or an attempt to screw them. Wether it is some old retired person complaining about the price of a cup of coffee they could have made themselves or some welfare mom whining about the costs of diapers, it is still a sign of a person with the assumption he is entitled to goods free of profit.
Now I'm sure many of you will say but they don't have the money. To which is say then screw them. You know what happens when I don't have money, I don't buy things. I don't go to the movies or sit at McDonalds for hours drinking coffee. It is all about personal responsibility and meeting your obligations in life.
Welfare is a perfectly good example of the issues we face as a society. Everyone fully understands that some, for whatever reason, can not function fully. Those are the people Welfare was original suppose to be inplace for. These days though we have a system that supports fully functional people whom are simply to lazy to work. It is culture of the entitled taken to the ultimate level, why work when I can have everything for free.
Sadly; as we can see in this thread, the culture of entitlement and ignorance is moving into the mainstream. The thought that the norm of a product costing more than the sum of it's parts, confuses and offends people that don't know anybetter. Hell there are people that think paying anything is to much effort but frankly these thieves aren't much different than those that object to profits of any kind.
Dave
The best reply EVER!
Thanks! Hadn't had coffee yet so I wasn't sure if it would be funny at all. I see I made a grammatical error in the chart. Oops.
At this point there are 63 posts. Of which 17 are either posted by teckstud or a response to one of his ravings. That's more than 25% of the thread (which is actually low for him).
Personally, I have him on ignore, but it doesn't work if everyone replies to his inanities which is exactly what he wants anyway. He's an attention whore.
If everyone added him to their ignore list, the forum would work a lot better. Please?
Here's (part of) the problem, and I'm not referring to anyone in particular here.
If I'm not mistaken, the posts of users you have ignored still show up, but their comments are collapsed. This creates a situation in which the user might be tempted to view the ignored post and then possibly respond to it. Ignored users' posts should not appear at all for those who have ignored them via User CP.
I'd like to see iSuppli do a "breakdown" analysis of the latest version of MS Office. Let's see: 10 cents to stamp the DVD (if even that) and about 5 cents to make the box it ships in. And how much do they charge for Office these days?
Just one example of why comparing the component costs to the sale price is an exercise in ignorance.
I don't want to put words in your mouth, but your post reads like you're blaming iSuppli for the (clearly widespread) misapplication of their manufacturing cost breakdowns.
From all the articles I've read, I've never seen iSuppli's analysts state (or even imply) that R&D, packaging, and marketing don't factor into the retail price. In fact, their original breakdown (from here) explicitly states: "Please note these cost estimates account only for hardware and manufacturing costs and do not include other expenses such as software, royalties and licensing fees."
I don't think it's iSuppli's fault that trolls with an axe to grind against Apple (or just the iPad) ignore all those other factors just so they can continue to bitch about something on the internet.
It's none of my business to know what Apple might have in the cost of a product ? none what so ever. Then you throw in that the prices you/they have, may well be wrong and it's all meaningless and none of my business.
If you want to put in there, Apples cost to operate their business daily, their cost for R&D, their cost to deal with all of the silly lawsuit they get each day, and the number of folks that are working because of Apple ? I MIGHT care this much more (very little).
If you have the time, I would like to know the cost for the following items I'd greatly appreciate knowing that I paid someone to make a profit on me
- Toyota Avalon
- Toyota Camry
- Panasonic 54" Plasma TV
- Pizza Hut Pizza
- Lottery Tickets I purchase each day
I KNOW there are more important things you could be doing, but it seems like you want to dig up dirt, so dig away.
Skip
Ignored users' posts should not appear at all for those who have ignored them via User CP.
The option like that in vBulletin is "Tachy Goes to Coventry" which is a global ignore list, though the site moderators can still see their posts. These posters won't even know their situation until they check the site from a logged out position to see that they are invisible.
To be frank you should get honorary PhD from Harvard Law School for your BS!
Please don't take it personal, accept your gift and use it wisely.