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  1. crg28's Avatar
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       #1  
    Intersting bit:

    "Apple's iPad 2 A5: fast LPDDR2 RAM, costs 66% more than Tegra 2

    By Daniel Eran Dilger - Apple Insider
    Published: 03:00 PM EST

    .
    The new A5 processor used by iPad 2 incorporates Samsung's new 46nm Low Power DDR2 memory, uses a variable clock speed and costs about $25, a significant premium over NVIDIA's competing Tegra 2.

    According to research performed by UBM TechInsights, Apple's larger A5 (12.1mmx10.1mm, compared to the 7.3mmx7.3mm A4) costs about $25 to build, making it $10 more expensive than similar dual core chips such as the Tegra 2 used by the Motorola Xoom.

    Even so, the firm estimates the iPad 2 total Bill Of Materials costs about $270, compared to its BOM estimate of the Xoom, which weighs in at $288 (both numbers compare 32GB 3G versions). "
  2. giggles's Avatar
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    #2  
    Probably the cheapest out of the 3. But maybe not because it is a 1.2 dual core chip which is the fastest out there.
  3. #3  
    BOM for Xoom is higher because it has more components, SD card, HDMI, etc. It is fascinating to see Apple continue to make product cost less than 50% of retail price.
  4. #4  
    The price of the SOC is $10 higher because it uses a newer graphics chip and memory and there are licensing fees involved. Tegra utilizes nVidia's own graphics chip and thus there is no licensing fee needed for the GPU component which apple must pay to PowerVR. I am sure LPDDR2 is more expensive than LPDDR.
  5. #5  
    i probabably is not the same for all devices. As the Wifi ipads are not the same as the 3G versions. There are some different chipsets in some versions for power amplification i'm sure.

    isuppli does BOM estimates. according to this
    The firm estimates that the iPad 2 with 32 gigabytes of flash memory costs Apple $323.35 for the Verizon Wireless version and $326.60 http://venturebeat.com/2011/03/13/ih...o-manufacture/
    but i dont' think we'll know until they publish a chart listing the components and the estimated cost.

    IHS iSuppli estimated that the Motorola Xoom cost $359.92.

    another interesting bit about the A5 chip from the article
    iSuppli says that Samsung is manufacturing the Apple-designed A5 processor chip for a cost of $14.
    guess we'll know in due time.
    Last edited by blackmagic01; 03/14/2011 at 04:56 AM.
  6. #6  
    nor does it factor in manufacturing costs and the costs of running the business.
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  7. #7  
    Quote Originally Posted by sapient2k7 View Post
    BOM for Xoom is higher because it has more components, SD card, HDMI, etc. It is fascinating to see Apple continue to make product cost less than 50% of retail price.
    It's not like the Xoom is cheaper. And Apple has to pay for their advertising somehow. And Steve Job's needs a new BMW every year. One of those M5's. LOL jk on that one!

    But just because the device costs half what we pay is not bad nor unheard of. It happens. But they do have more to pay for then just the parts of the device. They cost of putting them together (or actually paying another company to do that) advertising and I am sure there are other factors.
  8. #8  
    Quote Originally Posted by astraith View Post
    It's not like the Xoom is cheaper. And Apple has to pay for their advertising somehow. And Steve Job's needs a new BMW every year. One of those M5's. LOL jk on that one!

    But just because the device costs half what we pay is not bad nor unheard of. It happens. But they do have more to pay for then just the parts of the device. They cost of putting them together (or actually paying another company to do that) advertising and I am sure there are other factors.
    Yeah, I understand that. R&D costs are not included in the manufacturing cost via BOM neither are marketing, pre-sales and post-sales support or training. This is true for every device. As an example, Kinect retail price includes the marketing budget set aside for it i.e. the projected number of kinect devices they foresaw selling was priced in such a way that marketing cost for the device for that period would also be covered by the retail price.

    My only observation was that since the first iphone apple has continued to create (high-end/luxury) devices for around the same price point ($220-$260). They consistently have the highest amount of profit as well (based on the past four years of yearly profits). No matter what the R&D cost is they do sell their products at very high Margins.

    It all comes down to what a product is worth?. Is it worth the amount of money it cost to build it? or the amount of money most people would be willing to pay for it?

    Apple is very good at what they do and the prices they pay for these parts may be even lower than reported since they buy in huge bulks (sometimes causing shortage for other manufacturers).
  9. #9  
    Quote Originally Posted by sapient2k7 View Post
    Yeah, I understand that. R&D costs are not included in the manufacturing cost via BOM neither are marketing, pre-sales and post-sales support or training. This is true for every device. As an example, Kinect retail price includes the marketing budget set aside for it i.e. the projected number of kinect devices they foresaw selling was priced in such a way that marketing cost for the device for that period would also be covered by the retail price.

    My only observation was that since the first iphone apple has continued to create (high-end/luxury) devices for around the same price point ($220-$260). They consistently have the highest amount of profit as well (based on the past four years of yearly profits). No matter what the R&D cost is they do sell their products at very high Margins.

    It all comes down to what a product is worth?. Is it worth the amount of money it cost to build it? or the amount of money most people would be willing to pay for it?

    Apple is very good at what they do and the prices they pay for these parts may be even lower than reported since they buy in huge bulks (sometimes causing shortage for other manufacturers).
    Not only that but also getting your followers to re-buy your products over and over every year...
  10. #10  
    Quote Originally Posted by UntidyGuy View Post
    I believe those cost estimates do not in lure R&D or marketing. They just add up the wholesale cost of parts. A retail price that is at least twice that would probably be normal.

    Quote Originally Posted by sapient2k7 View Post
    R&D costs are not included in the manufacturing cost via BOM neither are marketing, pre-sales and post-sales support or training. This is true for every device.
    yep. This is just the cost to build the phone not to research and market it. It wouldn't be included. these are used by analysts to compare and estimate profit margins and price points.



    FYI: 10:10 Eastern tommorrow on Cnbc Leo Apotheker interview. they just mentioned it.

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