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Iphone Cellphones Apple Hardware

Teardown Finds iPhone 5 Costs Apple About the Same As Did 4S 143

Nerval's Lobster writes "A physical teardown of the iPhone 5 by IHS iSuppli reveals that Apple has managed to keep its materials and manufacturing costs roughly in line with that of the iPhone 4S. The firm estimated the Bill of Materials for the iPhone 5's low-end variant at $199.00, rising to $207.00 once manufacturing costs are entered into the equation. It tallied the BOM for the 32GB version at $209.00 (or $217 with manufacturing) and the 64GB one at $230.00 (rising slightly to $238 with those manufacturing costs). Compare that to the BOM for the iPhone 4S, which IHS iSuppli estimated at $188 for the 16GB version (rising to $196 with manufacturing costs added in), $207 for the 32GB version ($215 with manufacturing) and $245 for the 64GB version ($254 with manufacturing)." Reader redkemper writes with another kind of comparison of the newest iPhone to its predecessor: "Apple didn't spend too much time talking about the iSight camera at the iPhone 5s unveil event because it's mostly the same as the one found in the iPhone 4S. Thankfully, iMore grabbed an iPhone 5 and iPhone 4S and did a fantastic shoot-out between the two device's rear cameras. [The new camera] just barely edges out the iPhone 4S's year-old camera."
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Teardown Finds iPhone 5 Costs Apple About the Same As Did 4S

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  • by Anonymous Coward on Tuesday September 25, 2012 @11:46AM (#41450303)

    What other costs are there for Apple? 300% markup on list price seems a bit drastic.

    Not if people are dumb enough to pay it. They need their SHINY after all.

    Nice gig for Apple though. There's not a company on this planet that wouldn't love a 300% markup for its flagship products.

  • Camera (Score:4, Insightful)

    by sureshot007 ( 1406703 ) on Tuesday September 25, 2012 @11:47AM (#41450317)
    You don't need a high quality camera if all you do is post crappy instagram pics.
  • by jellomizer ( 103300 ) on Tuesday September 25, 2012 @11:50AM (#41450371)

    How horrible that someone sells a product that cost more than the sum of their part!

    We shouldn't have to pay for those millions in R&D and those failed designed they were working on.
    We shouldn't have to pay for the salary of the employees at apple.
    Heck those guys at Foxconn get next to nothing anyways... Why not go to the next logical step and have them work for free.

    Unfortunately running a business you find that things are more expensive than the normal consumer realizes.

  • Re:8$ (Score:4, Insightful)

    by Sparticus789 ( 2625955 ) on Tuesday September 25, 2012 @12:02PM (#41450591) Journal

    That's why their factories are in the middle-of-nowhere China. The real ironic part is the same people who buy Apple products are the same people who complain about Wal-Mart not offering a "fair wage" to their employees.

  • Yeah like, (Score:5, Insightful)

    by yabos ( 719499 ) on Tuesday September 25, 2012 @12:13PM (#41450753)
    Bigger screen, faster CPU&GPU, more ram, new camera? Oh wait.. they did that.
  • by Karlt1 ( 231423 ) on Tuesday September 25, 2012 @12:15PM (#41450791)

    "Not if people are dumb enough to pay it. They need their SHINY after all. "

    I keep seeing that, but the people don't pay more. The carriers pay more to Apple and subsidize more heavily, Tell me why should I care as long as I pay the same for the iPhone as any other comparable smart phone?

  • by Anonymous Coward on Tuesday September 25, 2012 @12:20PM (#41450863)

    The most iPhone manufacturing "ecosystem" is now in China. It's not just moving Foxconn's operatoins over here, it's moving their suppliers and the suppliers of the suppliers and so on.

    Also it's the way the Chinese do business. Here's the story that was told in the business press a while ago ....

    When Apple was looking for folks to make their phones at the very beginning, one of their reps went back to China and saw this factory being built. When the factory manager was asked, "What's going on over there?" He responded, "That's just in case we get your business."

    Apple hired them.

    No American company in their right mind would build an entire new plant "just in case".

    Flash forward and now the entire manufacturing chain is over there.

    And it's happening to more and more industries. You just can't pick everything up and move it.

    Gradually we're going to be a country of people cleaning the bedpans of the other people and finance our lifestyle with debt and asset sales - see Greece.

  • by mosb1000 ( 710161 ) <> on Tuesday September 25, 2012 @12:26PM (#41450961)

    Obviously, Apple spent a lot of money on their new 3D global mapping system, which isn't included in this cost estimate. They've also spent money developing other aspects of the new version of iOS. And they spent money designing the new version of the phone, and it's updated hardware. Of course, they're going to sell so many of these it'll wipe out those costs pretty soon. Still, any new development is risky. Look at all the bad press they're getting over maps! If they have to pull it, it will be a complete loss. Contrary to popular belief, about half of the new products Apple releases are actually flops. But a flop costs as much to develop as a success. Fortunately, Apple is able to charge enough of a markup on their successful products to make up the difference.

  • Re:Camera (Score:3, Insightful)

    by Hentes ( 2461350 ) on Tuesday September 25, 2012 @12:29PM (#41451003)

    Phone cameras are not high quality. Resolution doesn't matter much if your lens system is shit.

  • by macs4all ( 973270 ) on Tuesday September 25, 2012 @01:12PM (#41451645)

    What other costs are there for Apple? 300% markup on list price seems a bit drastic.

    No. A 3X markup from raw material and assembly costs to MSRP, up through distribution channels, is actually about right.

    Too bad Slashdot doesn't have any readers who have experience in the real world; or they'd realize that those "markups" are very realistic, when all you are considering is the BOM costs.

    Are people really so stupid that they don't realize that there are a LOT of other costs other than just the raw materials and CM (Contract Manufacturing) fees?

    Go do a BOM cost on your average $700 TV, or $400 A/V Receiver, or perhaps another Smartphone. You'll soon see what I mean. And CARS.... Talk about Mark-up... OMG!

  • by ColdWetDog ( 752185 ) on Tuesday September 25, 2012 @01:16PM (#41451701) Homepage

    No, 300% markup on a BOM is pretty bog standard on an electronics device.

    Get over it guys, the world isn't designed to give you your toys as cheaply as possible. That's what your parents were for.

  • Re:Camera (Score:5, Insightful)

    by macs4all ( 973270 ) on Tuesday September 25, 2012 @01:27PM (#41451923)

    The best camera is the one you have with you. And to be fair, iphone 4S produces images that would make my Sony Floppy-based digicam weep.

    Nice Ansel Adams quote (IIRC); and you are precisely correct. Anyone who thinks that any lens system than can fit into a phone will be the equal of any lens on a DSLR simply doesn't understand how physics works.

    But ya know, it's all about "capturing the moment". And these smartphone cameras are all about that. Which would you rather have: That priceless photo of a loved one that is now gone, but with a little spherical aberration near the edge; or nothing but a fading memory in your brain?

  • Re:Well, (Score:4, Insightful)

    by Pieroxy ( 222434 ) on Tuesday September 25, 2012 @02:51PM (#41453497) Homepage

    iFixit's usual thorough analysis reveals that nearly every hardware component has been upgraded or improved, yet is so power efficient that the battery capacity largely remains the same.

    And they couldn't even make it the same thickness as the old iPhone so it would last one day on one charge?

    I'm sick of "new features". How about releasing last year's phone with 4x the battery life since that's what technology can do?

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