Google Nexus 7 Parts Cost $18 More Than Kindle Fire 146
judgecorp writes "The parts for a Google Nexus 7 tablet cost only $18 more than the materials for an Amazon Kindle Fire, according to a teardown by IHS. This means while Amazon initially took a loss on each tablet sold, Google will break even on its 8Gb tablet, and make a small profit on the 16Gb model."
Doomed competition (Score:5, Interesting)
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:Stick, razor (Score:5, Interesting)
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.
Re:OhmyGOD yes!!! (Score:5, Interesting)
Because you don't know anything about Business.
Break Even doesn't equal sum(part) Break Even = Sum(Parts)+(Labor Rate+Benifits)/(Number of units)+(Total R&D costs)/Projected Unit sales+(Facility Costs)...
At $151.75 of parts and selling for 199 actually shows a really good work flow process.
Back during 1990's .COM boom a lot of companies didn't really understand the full cost on how to run a business, The consumers got flooded with a lot of inexpensive stuff (Which seems good) but then the companies shortly went out of business. Leaving us with cheap products that have no future. Or services that we enjoyed that went away, or have quickly gotten very expensive.