LONDON — A preliminary guesstimate by market research group iSuppli suggests the Bill of Materials (BOM) and assembly costs of the latest 8Gbyte 3G iPhone from Apple will be $173, making the device one of the most profitable ever for the company.
The second generation iPhone will hit the streets on July 11. The market research group says it would follow up this preliminary estimate with an actual teardown.
"At a hardware BOM and manufacturing cost of $173, the new iPhone is significantly less expensive to produce than the first-generation product, despite major improvements in the product's functionality and unique usability, due to the addition of 3G communications," , said Jagdish Rebello, director and principal analyst for iSuppli, in a statement.
"The original 8Gbyte iPhone carried a cost of $226 after component price reductions; giving the new product a 23 percent hardware cost reduction due to component price declines."
Carriers are expected to pay a subsidy of about $300 for each iPhone, depending on the territory.
Rebello notes that Apple is making a significant departure in its pricing strategy with the 3G version of the handset. "The original 2G phone was sold at an unsubsidized price of $499. However, at a retail price of $199 for the low-end 8Gbyte version of the new 3G model, wireless communications service carriers will be selling the product at a subsidized rate, using a common business model for the mobile-handset market."
In terms of margin, based on its teardown analyses, iSuppli suggests Apple' s iPod and iPhone products are typically priced about 50 percent above that of their BOM and manufacturing costs.
Typical BOM cost estimates include $22.80 for the 8Gbyte NAND flash memory, $20 for both the touch screen and display, $13.50 for the application processor, $15 for the HSDPA baseband chipset, and $3.50 for the GPS capability.
Related Articles:
Apple to sell iPhone through multiple networks in same country
The $199 iPhone: still a money maker
Apple enters IC market, buys PA Semi
RSS
Digital
10 emerging technologies to watch:
EE Times has compiled a list of emerging technologies that we think will be worth watching out for in 2010. Biofeedback or thought-control of electronics are among the contenders.
Hot applications in 2010:
We've compiled a list of 10 technology applications you should watch for in 2010, ranging from e-book readers to 3-D TVs. We examine the features that make these apps so compelling as well unresolved issues.
Top 25 predictions for semis in 2010:
2010 is just beginning to unfold in the electronics industry. Looking into our crystal ball, we have released our own chip forecasts--and other predictions--for 2010.
Seven things to fix in 2010:
The editors of EE Times came up with their own informal list of things we hope engineers fix in 2010, spanning everything from nano-lithography to space travel. What do you want to see get done this year?
'09 moves that are shaping the future:
This was a brutal year, but the industry gets a nod for showing grace under fire. Here's our Top 10 guide to the coming year, illustrating what to expect in 2010.
10 CEOs out in 2009:
It's been a tough year for the global electronics industry and CEOs. We survey the dismissal of 10 industry CEOs during the first three quarters of 2009 and what's ahead for the rest of the year.
Notable women in microelectronics:
There is no better time than a global economic recession to examine the keys to successful corporate governance. So, EE Times has compiled an international list that celebrates women who are business and technology leaders in semis.
EE Times updates Silicon 60:
Seventeen companies have been added to the lastest version of our Silicon 60 list of emerging startups. Forty-three companies survived as emerging companies that are still worth watching.
RSS| 
Digital| 
Mobile
