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Google Nexus 7 Parts Cost $18 More Than Kindle Fire

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  • Doomed competition (Score:5, Interesting)

    by MightyYar (622222) on Thursday July 12, 2012 @10:19AM (#40627737)

    Of course this doesn't bode well for competitor tablets. How many Google/Amazon business models are there that can afford to subsidize the tablets?

    • Re: (Score:2, Informative)

      by Anonymous Coward

      That's the point. Google's not having to subsidize their (Samsung's) tablet.

    • by Anonymous Coward
      Amazon new this going in (obviously) which was why they were willing to do it. They expected no real competition at the low end price point. I imagine they surveyed who their competitors could be and saw that none of the hardware makers stood a chance. They probably figured Google didn't want to get into the market again after their earlier forays into direct sales and lack of any perceptible support didn't go so well. But you are right - there really isn't anyone else that can make up the lack of profit on
      • by gl4ss (559668) on Thursday July 12, 2012 @10:37AM (#40627893) Homepage Journal

        I'd take the bill of material analytics with a grain of gunpowder and salt. and anything iSuppli says anyways.
        neither amazon or asus is paying list pricing for components and iSuppli doesn't know amazons or asus manufacturing expenses. furthermore they have no idea when each company bought the parts they bought.

        what they work as is a list of chips inside both devices.

      • by pepty (1976012)

        They expected no real competition at the low end price point.

        That may not be relevant. Amazon's business model for the previous kindles was to use it to get people to buy more stuff from Amazon and to collect usage records for marketing analysis. I have to think that's one reason they've been so generous about replacing broken kindles: working kindles keep generating revenue, broken ones don't. Even though the Fire and its competitors will be acccessing a much smaller percentage of their content from Amazon than previous kindles, Amazon's vertical (close enough)mo

    • by synapse7 (1075571)
      Unless they are giving it away for nothing, I'll still be buying a tablet with an SD slot of some type.
      • by GodInHell (258915)
        Why the obsession with physical media?

        Both the Kindle and Nexus 7 assumes that you are consuming media from the net.
        • by Andy Dodd (701) <atd7@NosPaM.cornell.edu> on Thursday July 12, 2012 @10:47AM (#40627965) Homepage

          Because you often use a tablet like this in places (buses, trains, planes, cars you are not behind the wheel of) where there is no network connection.

          Even for those situations listed above where you could tether to a smartphone, extremely low data caps (you'd kill your data allowance on most carriers with a single 720p movie for example) mean that cloud storage of video is nowhere near ready for mobile devices, and even cloud storage of music is a bad idea. (Streaming music frequently is a good way to hit your data cap.)

          • by TheGratefulNet (143330) on Thursday July 12, 2012 @11:19AM (#40628285)

            its refreshing to hear from the side that realizes 'the net' is not everywhere and always on at all times.

            younger developers are too spoiled and assume too many things when they design things.

            I don't have a 'data plan' and until they are affordable, I won't pay for one. if I'm out and about, its *not* assumed I'll have any kind of data connection. local storage always always works - WAN networks, well, not so much.

            • by DC2088 (2343764)
              Hello 2005
            • $30 a month isn't affordable?

              • First, I already pay $60 per month for Internet access at home. Why should I have to pay more in order to have something to do away from home? Ideally, an application would download data to the device's memory while online, store my changes while I work offline, and then upload the changes once I'm online again.

                Second, Virgin Mobile's cheapest Broadband2Go plan [virginmobileusa.com] is $35 per month, not $30 per month. It's limited to 2 GB per month unless the customer moves a couple hundred miles to a 4G city, so it can't re

            • by AmiMoJo (196126)

              I don't have a 'data plan' and until they are affordable, I won't pay for one.

              I guess you are in the US. You guys are getting butt-fucked by the phone companies. Cheap contracts with a free phone in the UK typically come with 1GB/month of data, but some carriers like 3 have a standard cap of 80GB. I pay Vodaphone £35/month, got a free Galaxy S3, 1GB data, 600 minutes and untold billions of texts.

              The really worrying thing is that the UK is actually quite expensive...

          • by Anonymous Coward on Thursday July 12, 2012 @11:53AM (#40628661)

            Because you often use a tablet like this in places (buses, trains, planes, cars you are not behind the wheel of) where there is no network connection.

            I just checked my (wifi-only, 16GB) iPad (with about 3 GB free on it at present). I have ~24 hours of music and podcasts (~4 GB), 6 hours of tv shows (~3 GB), an iOS programming course (~3 GB), 142 Books (in the Kindle app), and 8 games on it (~2 GB). None of them require a single bit of over-the-air data, because everything is synced to my ipad's internal storage. And if there's something I REALLY REALLY WANT, I have never been UNABLE to wait a few hours until a wifi signal is available, and download it then, onto the ~3GB of internal storage *still left* on the model of iPad with the *smallest* internal storage that they sell.

            Could you explain to us exactly what sort of bus ride, train ride, plane ride, or car ride you're taking that would legitimately require MORE internal storage than that?

            Or are you REALLY so disorganized that you can't manage to keep a few "current, interested in listening/watching/reading/playing these things" items on your tablet to keep you busy for 5-6 hours on a trip? And if you are... how exactly does an SD slot fix that problem? You'll just end up with a fucking empty SD slot which you forgot to load shit on for your long bus/plane ride, too.

            Can this myth of "without removable storage your tablet is worthless" finally fucking die? PLEASE?

            • You miss the point. It's not about needing all of that stuff in a single trip, it's about having specific things available when you want them and not having to constantly juggle data back and forth between the tablet and a PC or internet.

              For me, 16GB (more like 12-14GB user accessible) would barely hold two HD movies, at about 5-6GB each. My music library takes up over 120GB and the average "AAA" mobile game is 1-2GB now. A 16GB storage limit doesn't offer a lot of on-the-fly selection.
              • by Anonymous Coward

                No, I don't think I do miss the point. I actually think you are failing at basic maths.

                How does the data magically get on these SD cards? By being copied there from a computer, or tablet, or other device. How does the data magically get on the computer or tablet? By being synced from another device, over the network, or by being copied from another computer, or other device. Either way (SD card or internal storage only), you're reliant on either a network connection, or another computer, to copy your d

                • How does the data magically get on these SD cards? By being copied there from a computer, or tablet, or other device. How does the data magically get on the computer or tablet? By being synced from another device, over the network, or by being copied from another computer, or other device. Either way (SD card or internal storage only), you're reliant on either a network connection, or another computer, to copy your data around.

                  Yes, but in my case, I only have to copy the data once. In yours, you have to copy it every single time you want to shuffle stuff around in that 16GB.

                  And now let's consider this proposed use case - your music library is 120GB. Let's say you want to have 8 games (1GB apiece, your own estimate). And, let's say nice round numbers, 8 movies, at 5 gb apiece. That's... 168 GB of storage you want to manage via your SD slot.

                  How many SD cards, exactly, are you carrying around in your pocket? 170GB of storage, assuming 16GB microSD cards, is 11 cards that will need to be managed, labeled, kept track of, stored safely, and juggled on the go. Looking at NewEgg right now, 16GB microSDHC cards look like they're going for $10 apiece. So you're spending an extra $110 on that storage, have to MANAGE all that storage, have to KEEP TRACK of all the cards (and they're small, and easily lost if you're swapping them around constantly), and have to make sure your entire library is copied TO those cards. And as your library grows, you have to keep paying for new cards, manage those new cards, and carry them around.

                  That's six 32GB cards (or three 64GB cards), with about 12GB to spare, after factoring in formatted capacity. They fit nicely in the pocket of my tablet's cover or even in my wallet. On Amazon, you can get a 32GB Class 4 microSD card for $13 or a Class 6 for $20.

                  How is this, in ANY appreciable way, preferable to saying "load the device with a reasonable amount of stuff before I leave on a long trip, and use wifi to download new stuff when the opportunity presents itself?" I have traveled around Europe and the US (including the very-wide-open midwest), and I've rarely been out of range of SOMEPLACE offering wifi for more than a few hours.

                  I have lived in and traveled to many countries around the entire world and there have been loads of

                • Full disclosure: what I'm about to say is largely me playing devil's advocate because I personally don't have the ipad's storage likely wouldn't be much of an issue for me personally, but back when data was more expensive/scarce I could relate to what I believe the other poster is referring to.

                  I've found that transferring a large amount of data is a pain. Yeah, you can connect your ipad occasionally to your computer to swap out your media...but it's a pain and is unlikely to happen on a frequent basis. Most

            • by chispito (1870390)

              Or are you REALLY so disorganized that you can't manage to keep a few "current, interested in listening/watching/reading/playing these things" items on your tablet to keep you busy for 5-6 hours on a trip? And if you are... how exactly does an SD slot fix that problem? You'll just end up with a fucking empty SD slot which you forgot to load shit on for your long bus/plane ride, too.

              Can this myth of "without removable storage your tablet is worthless" finally fucking die? PLEASE?

              SD is the easiest way to get content on to, and off of, these types of devices. I also would be largely interested in using a tablet to review photos taken with my camera.

          • by dAzED1 (33635)
            time management? Planning for those trips to abandoned underground bomb shelters that can't get signals, and thus putting the stuff on your device before you go, instead of relying upon a bunch of external physical media? I used to love my floppies too back in the day, but they make a little pill for that now in this century...
          • by synaptik (125) *
            What is the difference between these two outcomes:
            1. Realizing you will later be on a bus/train/plane/car/deserted island with no connectivity, and preloading your sd card with content to consume during your adventure
            2. Realizing you will later be on a bus/train/plane/car/deserted island with no connectivity, and preloading your device with content to consume during your adventure

            ?

            Or, are you bemoaning the loss of opportunity to swap pre-loaded sd cards with your fellow travellers/castaways? Beca
            • The difference is with a large enough SD card, you don't have to custom tailor what you have on it. You just throw it all on there and leave it be so it's ready all of the time.
            • Assuming I'm on a deserted isle and assuming I get to pick my fellow castaways, I'd be too busy fucking to worry about SD cards.
        • by Chrisq (894406)

          Why the obsession with physical media? Both the Kindle and Nexus 7 assumes that you are consuming media from the net.

          He wants his pron collection to be quickly disposable.

        • Why the obsession with physical media?

          Both the Kindle and Nexus 7 assumes that you are consuming media from the net.

          Because when my phone / tablet dies I would still like to be able to get the data off of it by removing the memory card. This also makes swapping devices trivial because you can just move your memory card around.

          • by swillden (191260)

            Why the obsession with physical media?

            Both the Kindle and Nexus 7 assumes that you are consuming media from the net.

            Because when my phone / tablet dies I would still like to be able to get the data off of it by removing the memory card. This also makes swapping devices trivial because you can just move your memory card around.

            For music (which is the biggest consumer of storage on my devices), just upload it all to Google Music. Then when you switch devices just let it download onto your new device over Wifi (which it will do automatically in the background, whenever you have Internet). The download isn't as fast as just moving an SD card, of course, but it also means that your music can easily be on multiple devices at once, and you don't have to worry about losing your SD card.

        • Why the obsession with physical media? Both the Kindle and Nexus 7 assumes that you are consuming media from the net.

          Jesus's clone riding a genetically resurrected dinosaur in the name of logistics, man. Are you aware that net access is not omnipresent, and despite the media/geek-wannabe hype, it will not be for years to come? It might be omnipresent in our cubicles and wired dwellings, but once we step into the sunlight (${DEITY:-FSM} knows some of us do), we don't even get a guarantee of cell phone signal everywhere.

          Do you think wifi fares better?

          Let's forget the hyperbole for a second. You want to have access to y

    • Of course this doesn't bode well for competitor tablets. How many Google/Amazon business models are there that can afford to subsidize the tablets?

      Au contraire. The only competitor netpad this displaces is Amazon's, and only the currently shipping version. Google's tablet accomplishes two things: 1) together with Amazon's to-be-discounted Fire and Fire's successor, this will establish Android as the netpad leader and thus bring in the developers (developers, developers!) 2) it establishes a minimimum hardware spec for the $200 netpad segment.

      Frankly, Moore's law says that in six months this hardware doesn't need subsidizing. At that point Google's har

      • by MightyYar (622222)

        Frankly, Moore's law says that in six months this hardware doesn't need subsidizing. At that point Google's hardware partners will entry (Amazon isn't one) and Google will step back.

        Why wouldn't they come out with a better unit at the same price point?

        • Frankly, Moore's law says that in six months this hardware doesn't need subsidizing. At that point Google's hardware partners will entry (Amazon isn't one) and Google will step back.

          Why wouldn't they come out with a better unit at the same price point?

          They would only do that if their partners need another kick in terms of specs. Which is unlikely. Remember, Google's business is selling ads, not hardware. Google is only selling hardware at the moment to prevent Apple from setting up toll booths around the netpad segment. The big downside of Goolge refreshing its product at the 7 inch form factor is, what a great way to scare off hardware partners. IMHO Google will instead introduce a 10 or 11 inch netpad, extending Android firmly into that space, then get

      • by Shotgun (30919)

        You can already get a better tablet for less. I carry a LePan that I got from Wal-Mart. Not a big name, but it is solid as a rock, with a 10" display, GPS, accelerometer, bluetooth and SD slot.

    • by symbolset (646467) * on Thursday July 12, 2012 @02:03PM (#40630219) Journal
      These tablets have limited time to establish dominant mindshare. If Google subsidized each tablet $10 for 100 million tablets a year, that would be the$1B/yr level Microsoft is subsidizing Nokia. This isn't business any more, except to the extent that as always - business is war. The goal here is to kill the PC outright before Microsoft achieves their avowed goal of killing Google.
  • Stick, razor (Score:5, Insightful)

    by Anonymous Coward on Thursday July 12, 2012 @10:24AM (#40627777)

    This makes sense.
    Andriod is really a platform for Google to sell their services (or promote ad based ones). It's not surprising they'll sell an at-cost device. They're also really nice machines, and set the bar for what a "low cost" device should really have. Fast quad core, latest OS, plenty of ram, access to google play(store). Great way to bump inferior devices off the market that would degrade user experience and cost them service revenue.

    Even the small storage and lack of sd card is a "feature". - It provides a place to differentiate other tablet makers, who can add a card slot and more storage and charge a price premium over the nexus. (Well, that and the low storage encourages users to get their data from google online services rather than store it locally)

    I recently picked up a galaxy tab 2 7.0 (Before google announced their offerings). Great little device. I love it, but clearly inferior to the new google equivalent. Sorta wished I waited.

    • Re:Stick, razor (Score:5, Interesting)

      by ifiwereasculptor (1870574) on Thursday July 12, 2012 @10:28AM (#40627813)

      This makes sense.
      Andriod is really a platform for Google to sell their services (or promote ad based ones). It's not surprising they'll sell an at-cost device. They're also really nice machines, and set the bar for what a "low cost" device should really have.

      Very true. I wish they also did something similar with phones. Right now Android is perceived by a lot of people as kind of crappy because the phones they buy are kind of crappy. Maybe Google realized that the lower end is a better place to insert the Nexus reference and kill bad products by offering better alternatives.

      • Very true. I wish they also did something similar with phones. Right now Android is perceived by a lot of people as kind of crappy because the phones they buy are kind of crappy.

        In some countries Samsung is already selling Android (2.2) phones not much more expensive than an feature phone. So I doubt anybody can sell any cheaper that and still get some measure of quality. And I doubt that Google would be interested in selling cheap smartphones since that segment is already well taken care of by the cellphon

        • by Rich0 (548339)

          Sort of. There are lots of cheap phones. There are few if any that run stock Android and provide decent updates.

          One of the things Google should do with Nexus is raise the bar, as they did from the start.

        • by tepples (727027)

          In some countries Samsung is already selling Android (2.2) phones not much more expensive than an feature phone.

          But in the United States, entry-level Android smartphones such as the Samsung Intercept tend to be locked to carriers that require buying a data plan, not a voice-only plan to be used with a customer's existing Wi-Fi connectivity.

      • by GodInHell (258915)
        Except that the best deal will probably still be whatever tablet goes on clearance.
        • A clearance desktop may be mostly up to par with one or two mediocre specs that will make it age quickly. Like low RAM or HDD in an otherwise mid-range machine. No biggie; when it starts to be a problem in a year or two, a $50 upgrade part will let it stave off obsolescence for a few more years. By the time your upgraded spec becomes a problem again, all the specs are becoming a bit dated. Time for a replacement. Tablets, on the other hand, aren't so flexible. If one of the specs turns out to be stiflingly
      • by Andy Dodd (701)

        They are doing this with the Galaxy Nexus - yes it's more expensive because sticking an extra radio into a smaller device will drive costs, but still - $350 for an unsubsidized flagship smartphone is dirt cheap compared to the rest of the industry.

    • Re: (Score:1, Informative)

      by GodInHell (258915)

      Andriod is really a platform for Google to sell their services (or promote ad based ones). It's not surprising they'll sell an at-cost device.

      /cough/ This isn't actually a Google product -- ASUS producing and selling the device, it's just google branded. (See also, *Samsung* Galaxy Nexus).

      • Re: (Score:2, Insightful)

        by Anonymous Coward

        That sound you heard was the point of this conversation flying over your head. (And whoever modded you up)

        Yes, Asus makes it.. But it's clearly a google product. That's how google is promoting it in every shred of marketing material I've seen.. The at-cost price would not make any sense whatsoever for Asus because they don't run the revenue generating end-user services. Google does.

        • by GodInHell (258915)

          Yes, Asus makes it.. But it's clearly a google product.

          That would imply that the profits from the sale are Google's - which isn't actually the case. Google isn't hiring ASUS to build these and distribute them at cost, Google partnered with ASUS to produce an officially branded tablet. The Nexus 7 is the new flagship Android tablet -- but it's not their product.

          • If you're going to take that view, wouldn't most computers technically be Foxconn's products?
            • by GodInHell (258915)
              That is exactly my point. Apple pays Foxconn to assemble products designed by, sold by and marketed through apple's distribution chain as apple products. Google partnered with ASUS -- ASUS designed and produced the hardware branded with Google's logo. Google may be getting a cut through a licensing deal (licensing the logo to ASUS) but that's an ASUS device -- its even ASUS branded.
    • by Anonymous Coward

      $200 was the price point I fully expected the original iPad to debut at. There was absolutely no conceivable use case (to me) that would make it worth more than what I'd spend for, say, a video game console -- the thing is a toy/consumption device.

      When the iPad's price was announced, I figured it would flop. I guess I greatly underestimated people's willingness to pay for yet another way to put an insipid glowing rectangle in front of their faces for more hours of the day. I do tend to give people too mu

  • I'm pretty sure that these devices have more than 1 and 2MB of storage. I don't expect editors to edit or anything, but are nerds seriously still having problems with the idea that the abbreviations for units are case-sensitive? K is not k and b is not B and so on?

    • by CanHasDIY (1672858) on Thursday July 12, 2012 @11:01AM (#40628111) Homepage Journal

      I'm pretty sure that these devices have more than 1 and 2MB of storage. I don't expect editors to edit or anything, but are nerds seriously still having problems with the idea that the abbreviations for units are case-sensitive? K is not k and b is not B and so on?

      Dude, I have had people (I assume they're people, then again this is /.) argue with me about whether or not it's proper to capitalize the letter i when using it in self-reference (i.e., "I'm not so dumb as to think I don't need to capitalize i when I self-reference"). Same goes for capitalizing the first letter of a sentence, and proper nouns. The way some folks bitch about having their capitalization corrected, you would think the Shift key killed their family and raped their dog...

      Keeping that in mind, are you really all that surprised?

  • In what quantity? (Score:5, Insightful)

    by cdrguru (88047) on Thursday July 12, 2012 @10:32AM (#40627849) Homepage

    What quantity is this costing based on? Something tells me that Samsung gets different prices that some Joe on the street, especially when buying something in millions of units at a time. Sure, a processor chip might cost $50 if you buy one and $10 if you buy 1000. What happens when Samsung buys a million of them, which could be the entire output of the manufacturer for several months? At those quantities you also have fun things like the buyer demanding that they get the right to go to other fabs so they can get the quantity they need - they essentially license the rights to produce the chip themselves.

    Of course, it is then a short hop down the road to the manufacturer simply being added to the stable of companies owned by Samsung. Or not quite owned but invested in such that the manufacturer can produce the quantities that Samsung desires.

    Such cost estimates are garbage because Samsung isn't talking about what they are really paying for parts. So all you have is guesswork based on public information. I would offer that neither Amazon nor Samsung is paying the sort of prices that are publicly available and special deals are being cut in exchange for who-knows-what.

    In electronics there are three quantity levels that count: one, 1000 and the entire output of the manufacturer for months. When you scale up to the last one, the buyer gets to dictate what the price is going to be and the seller is pretty much at the mercy of the buyer.

    • In order to get an Apple to Apple comparison point, they probably look at the cost per thousand. This at least allows them to provide some kind of estimate that compares across multiple brands when they use the same/similar parts

      Of course it is by no means an accurate comparison for the reasons you stated - There's a lot of difference between Google and Samsung in quantities purchased though the comparison is far more close between Amazon and Google based on initial quantities manufactured

    • by devitto (230479)

      Yeah, you really need to understand electronic manufacturing.
      You don't really get massive mark-downs for volume - maybe 70% difference from 1 to 1 million.
      It's like kit-cars, they are not 1000 times the price of a comparible Ford, even though Ford make a 100 million more that you do.

      Hence being able to price up the hardware in these teardowns. Yeah, maybe they are 10% out, but they're not 30% out, and both teardowns will be wrong by the same degree...

      • Re:In what quantity? (Score:5, Informative)

        by jrumney (197329) on Thursday July 12, 2012 @11:35AM (#40628425) Homepage

        You don't really get massive mark-downs for volume - maybe 70% difference from 1 to 1 million.

        I don't know which branch of electronic manufacturing you're talking about, but the one I'm familiar with has a MASSIVE per unit cost difference between buying one off components and buying them by the reel, and another big cost drop once your volume becomes high enough that the component manufacturer will deal with you direct instead of having to go through a distributor.

      • You don't really get massive mark-downs for volume - maybe 70% difference from 1 to 1 million.

        Often you get 70% difference is between 1 and 500 components.

        Semicondutor manufacturing is characterized by huge fixed costs and lauguably small unit costs.

    • by Pax681 (1002592)
      erm.... always with "samsung" .. THE PARTNER FOR THESE IS ASUS...... NOT SAMSUNG" ...
      i am far from the first person to point this out here
    • When you scale up to the last one, the buyer gets to dictate what the price is going to be and the seller is pretty much at the mercy of the buyer.

      Almost. When you get to the last one you get really the best price possible but it's not like you can get a billion processors for a penny each. There is always a limit and there is always the option to walk away. It's often hard, but if you're going to lose money on a piece of business, you're generally not going to do it unless there is something else at play.

  • Google will have to pay its retailers about 20% retail markup and definitely lose on each sale. Apple and Amazon wont have to pay the retail markup.
  • The make 30% of each book, movie, song, and app sold. So Amazon can essentially give its tablets away at cost and still make lots of money. I wonder if GooglePlay has similar profitability.
    • Amazon looses money on many of its book sales as well. They sell new releases for $9.99 below the wholesale price. Many of their app sales are also discounted.
    • by paulpach (798828)
      My game [amazon.com] made it to top 25 in the first month. I can tell you from experience that this model is a win for everyone involved:
      1. 1) Kindle fire users get a tablet at very low cost, with tons of apps available
      2. 2) Amazon makes 30% of all the sales, which are substantial.
      3. 3) We (developers) don't have to worry about distribution, refunds, credit cards, or anything like that. We do what we are good at: make a game.
      4. 4) We (developers) are exposed to tons of users that bought the cheap tablet

      I can only hope more c

  • According to some reviews, the Nexus 7 is the fastest Android tablet to date. Add the retina display, and you got yourself an expensive little piece of kit.

  • The problem with most of these sorts of analysis is that they have no real way to know what sort of volume discounts Google or Amazon are getting. You can ask what the prices are but when you start getting into millions of units that usually takes more than a phone call. Pricing on electronics components is strongly a function of volume. (I know because I buy them daily in my day job) Spot market rates aren't usually the same as contract rates either and for the sorts of volumes Google would deal in we'

  • Apparently, to Google, "pre-order" means you're the last person to get one. They're supposed to hit retail stores today and they're already on eBay. Meanwhile, I check my "Google Wallet" account and it just says that Google "received my order" since June 28th. No updates, no shipping information, no reply to my e-mail, nothing.

    The very least they could do is provide some damn communication on why they're shitting on their pre-order customers.

    If the Nexus 10 ever becomes a reality, don't "pre-order" it! You'

  • And why I will never buy one

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