updated 08:00 pm EDT, Wed October 19, 2011
iSuppli teardown shows same price despite 3G swap
A new cost breakdown by IHS iSuppli has given more definitive raw parts costs for the iPhone 4S. A 16GB version of the phone is estimated to cost about $188, or within 50 cents of last year's model when it was new. The switch from an Infineon (now part of Intel) chip to the dual-mode Qualcomm chip had little impact on the cellular chipset, which in total cost about $14 to $15.
Infineon still had a chip, but at 50 cents it was more of a consolation for lost business rather than a direct alternative.
The A5 chip cost the same $15. Its eight-megapixel camera is estimated to cost $17.60 but has been more difficult to gauge given a lack of identifiers it speculated might have been deliberate. The design is known to carry a Sony sensor, but it may have been made by Apple's longtime camera module supplier, Largan Precision. OmniVision is rumored to have been dropped due to low supply.
Other part suppliers are familiar and include AKM's compass, STMicro's gyroscope sensor, TI audio and touchscreen controllers, and Triquint wireless transmitters.
Some cost-cutting might have come from moving active noise cancellation processing during calls from a dedicated chip to the processor. The dual-core A5 may have meant getting the decoding relatively penalty-free. As usual, moving up in flash storage has a cost disproportionately lower than what Apple charges, at $207 for a 32GB model and $245 for 64GB, although Apple had moved to Hynix, likely to avoid depending too much on a company it's suing for storage.
The price doesn't reflect the full cost of developing and selling the phone, which is considerably higher. Apple during its latest results call estimated a 40 percent gross margin across all of its products and, in the US, charges $649 at full price for a 16GB iPhone 4S.
Apple's strategy points to it having had little room to breathe for extra components, such as more RAM or a bigger touchscreen. Its cost choices, such as hitting the $199 contract price, might have prevented more. HTC's rush to get an early LTE chipset led to the Thunderbolt costing $262 in parts and Verizon charging $250, even with lower margins. [via AllThingsD]