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iSuppli: iPhone 3G costing Apple $173 to build

updated 05:00 pm EDT, Tue June 24, 2008

iPhone 3G build costs

Each unit of the iPhone 3G is costing Apple approximately $173 to assemble and manufacture, writes iSuppli. The research group says it has conducted a preliminary, "virtual" teardown of the phone, based mainly on arguments from internal experts on fields such as cellphones and wireless technology. If the estimate proves accurate it will represent a 23 percent decline in cost from the original 8GB iPhone, which took $226 to make. The reduction is attributed to a drop in the cost of individual parts.

Apple should in fact make a greater profit on the sales of 3G units, says iSuppli, even though the new devices will sell for as little as $199. This is because it believes carriers are paying Apple roughly $300 to subsidize each phone, maintaining or expanding on the margins of the 4GB, $499 iPhone Apple briefly produced. This margin should only expand over time, as the cost of manufacturing naturally declines. It is predicted to slide to $148 in 2009, and if the phone were left untouched, it would cost as little as $126 in 2012.




by MacNN Staff

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Comments

  1. eldarkus

    Joined: Dec 1969

    0

    left untouched??

    and if the phone were left untouched, it would cost as little as $126 in 2012.

    HA! iSuppli must not be too familiar with Apple

  1. testudo

    Joined: Dec 1969

    -7

    What??????

    Why is this on MacNN???? It has nothing to do with the Mac!

  1. Guest

    Joined: Dec 1969

    +5

    Relevance to Mac

    The iPhone is a Mac OS device, and shares APIs with desktop and laptop Macs. So that makes it perfectly appropriate to MacNN

  1. Guest

    Joined: Dec 1969

    +2

    iSuppli again, huh.

    iSuppli seems to always present "this is what we think the parts cost" as "this is it costs the company to build it." There's a lot of costs involved in building and shipping a product other than simply the cost of the parts, but iSuppli keeps giving the false impression that retailprice - partscost = profit. And in this case, they haven't even touched the hardware, they have no idea what's inside the box, just a bunch of guesses, yet they come up with a non-round number like 173. Hmm.

  1. UberFu

    Joined: Dec 1969

    0

    well...

    Apple is subsidizing the phone_



    iSuppli is just as retarded as most other analyst groups_



    And their take on the $226 pricetag last year took into account off-the-shelf consumer pricing and not wholesale bulk pricing of the components_



    I'm not even bothering with looking into their nonsense this time as it was a waste of time last time and twice is shame on me_

  1. UberFu

    Joined: Dec 1969

    -1

    well...

    Apple is subsidizing the phone_



    iSuppli is just as retarded as most other analyst groups_



    And their take on the $226 pricetag last year took into account off-the-shelf consumer pricing and not wholesale bulk pricing of the components_



    I'm not even bothering with looking into their nonsense this time as it was a waste of time last time and twice is shame on me_

  1. UberFu

    Joined: Dec 1969

    +1

    macnn

    fix the "new improved" posting mechansim - it still sucks_

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