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Kindle 2 Tear-Down Reveals Price of Components 169

adeelarshad82 writes "Amazon's wildly popular Kindle 2 got a good old fashioned tear-down from the folks at market research firm iSuppli. According to the organization, the Kindle 2's manufacturing cost is almost half as much as its retail price."
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Kindle 2 Tear-Down Reveals Price of Components

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  • by brainproxy ( 654715 ) on Wednesday April 22, 2009 @04:07PM (#27678375)

    It's not like Amazon somehow magically doesn't have any overhead, shipping or design costs for the Kindle. They also have inventory costs, returned item costs and all the other gunk associated with manufacturing and selling an item.

    Having merely a 50% of the cost (not including IP) for a still pioneering device like this seems totally reasonable.

    Lets not also forget that Amazon pays not only for the bandwidth to deliver all that content, but also pays for the Wireless data service for EVERY unit out there, perpetually.

  • by Anonymous Coward on Wednesday April 22, 2009 @05:12PM (#27679269)

    Well, in fairness, Amazon could sell the units at a loss and make up the difference on digital book sales much like the console manufacturers do.

    Aside from the Xbox, who sells consoles at a loss?

    This has been fairly standard practice since the PS1 days.

  • by Anonymous Coward on Wednesday April 22, 2009 @05:34PM (#27679633)

    You do know that Kindle was sold-out for the longest time, since production couldn't keep up with demand?
    They have no need to increase the sales at this point.

    Also: there are very real dangers in lowering price for products; human mind tends to consider more expensive products as better, higher-quality things.
    Conversely, lowering price can dillute the brand.

    So there is very little point for Amazon to reduce the price significantly at this point.

  • Re:So... (Score:0, Informative)

    by Anonymous Coward on Wednesday April 22, 2009 @05:41PM (#27679749)

    Dear crackhead moderators,
    how the fuck did you reason when you thought this post should've been modded Insightful?

    Let me quote from the fucking summary:

    Kindle 2's manufacturing cost is almost half as much as its retail price

    For those of you who aren't fucking retarded, it means the markup is roughly one hundred per cent.

  • by Ortega-Starfire ( 930563 ) on Wednesday April 22, 2009 @06:49PM (#27680519) Journal

    Let me fix that one more time for you.

    It's the Ferengi way.

    Which proves the fix above you is correct, not yours, as according to Rule 284 of the Rules of Acquisition:

    Deep down, everyone's a Ferengi.

Suburbia is where the developer bulldozes out the trees, then names the streets after them. -- Bill Vaughn