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According to isuppli's teardown of the kindle the E Ink display is $60. The main processor (made by Freescale) is ~$8. The EPD chip, which is what becomes redundant adds only $4.31 to the BOM. The main point is you cannot expect E Ink based readers to get any cheaper any time soon. Any price cuts will only come about due to increased competition from different technologies like Pixel Qi's, or by sacrificing things like onboard wireless (which adds ~$40 to the cost of the Kindle).

iSuppli reports the cost of the display modile is ESTIMATED at $60
I put estimated in capital letters as TFA I linked says its an estimate.
Anyway, Just throwing that out there for those curious about the cost breakdown

So, Google/HTC could have very easily made this one phone model compatible with not only T-Mobile and AT&T, but pretty much any 3GSM network worldwide if they only included the right combination of power amplifiers. According to iSuppli’s teardown of the Nexus One, the four small power amplifiers that are in the Nexus One only account for $2.20 in manufacturing costs. $2.20! How much more could a different combination of power amplifiers have cost? Maybe another $2 (at most)?!

It just sounds like a deliberate decision to aid the wireless carrier oligopoly. Given that we’ve seen HTC’s FCC documents to introduce an AT&T oriented version of the Nexus One, you’d think that overall engineering, manufacturing, warehousing, and sales expenses would be lowered enough by offering a single model that could replace two.

The deliberate lack of network compatibility is simply bewildering.

What was that about not being evil again?

Indeed. Check out the price of the 1GHz Snapdragon CPU, GPU, and Baseband (and video, 3D, security, I/O, etc) chip in the Nexus One:

http://www.isuppli.com/News/Pages/Google-Nexus-One-Carries-$17415-Materials-Cost-iSuppli-Teardown-Reveals.aspx

In short: $30.50.

Sure, Mooretown will integrate a CPU and GPU with 3D and video. It might support the AES instructions added to x86 recently by Intel too. But it doesn't have the baseband processor which would be separate in such a phone. It might also need a separate I/O chip. It won't run as cool as the A9 SoC either. And Intel won't want to sell such a chipset for such a low price.

Using the DROID as an example:

The DROID with no contract is $560.

Math with the current termination fee: $200 for the phone + $175 to immediately break your contract = $375 (You save $185 over the no-contract price)

Math with the new termination fee: $200 for the phone + $350 to immediately break your contract = $550 (You save $10 over the no-contract price)

Either way you save more than simply buying the phone without a contract. The new fee is high, but I can understand their reasoning.

Why do you blindly accept Verizon's word that the true cost of the DROID is $560? I don't know how much the DROID cost to manufacture, but the components of an iPhone 3GS cost $179. Assume the same for the DROID and toss in a generous amount for Motorola's assembly and R&D and I will guesstimate that Motorola can easily sell these things at $300 each and still make a reasonable profit.

Verizon wants to make it effectively impossible for people to leave so they slap on a ridiculous extra $260 to what they paid for each DROID and they announce that a no-contract phone costs $560. All of a sudden the price-gouging termination fees they charge for their plans are 'justified'.

Oh yeah, and if you pay the ridiculous termination fee you must trash your DROID as it is carrier locked. You don't even own the phone you paid for.

This is just another reminder of why we desperately need Net Neutrality to apply to wireless carriers -- Motorola would then be selling unlocked DROIDs directly to users regardless of cell phone provider. The retail price of the DROID would be determined by the open market in competition with every other model of cell phone.

I call BS. You can buy an 8 gig ipod touch today for under $200. According to the iSupply teardown, the GSM chipset in the iphone costs $2.80.

$179.00 + $3.00 != $800

I call BS. GSM Chip = $2.80 + power amp chip for each band (Quad Band), + antenna+ plus a ram chip and memory chip for modem + Patent Royalties. Now all those extra chips require a higher layer board to put the more complex circuits. Now a phone requires PTCRB and GCF certification at $30,000-$100,000 a pop, but Carrier based lab testing. Those iSupply teardown are wildly inaccurate because they forget the patent royalties associated with GSM, Audio/Video Playback. Those can cost upwards of $5-$10 per device.

This still doesn't add up to $800, but you cost estimate is inaccurate. You need to look at the current retail pricing of the current generation Ipod touch. Older models might be on clearance (with the retailer actually losing money) and don't reflect a real product costs.

Real final costs for apple is probably in the $250 range per phone. Now they take a 100% markup and the retailer takes a 20% markup and we end up around $600

The iPhone and Blackberries would bounce up to more normal $800+ pricing.

I call BS. You can buy an 8 gig ipod touch today for under $200. According to the iSupply teardown, the GSM chipset in the iphone costs $2.80.

$179.00 + $3.00 != $800

This video might be somewhat relevant to your interests...

Or here?

Slashdot comments often forget to differentiate between "worldwide" market share and "U.S." market share. That iSuppli report refers to "worldwide" market share:

• For just Q4 2007, Apple had a 2.9% share of the global market.
• For the entire year 2007, Apple has a 2.8% share of the global market.

The Mac Observer's news article about this report says "Apple's Macintosh market share in the U.S. has been climbing and is at about 8 percent," which is a pretty big chunk for a single PC manufacturer, but maybe not so big for a "platform." The Mac Observer doesn't say where they got that 8% number (it wasn't from that iSuppli report).

Isn't it sad that he got modded up, for being Wrong, I was going to correct him, because since OSX apple has become the number one competitor to 'dell.'

HP 14,567,000
Dell 11,320,000
Acer 7,220,000
Lenovo 5,760,000
Toshiba 3,070,000
Apple 2,197,000

A teardown revealed that the EE cost $27 each from Toshiba, and integrating it probably cost another $5 (including specify other mutual parts that will serve double, rather than single, duty, including security HW for PS2 games).

So you're probably nearly exactly correct. I wonder how much per revised unit it will have cost to redesign and change the manufacturing, across the first few million units sold. Possibly a breakeven, if the redesign/retool cost more than $30-60M.

I think they're just dropping PS2 compatibility so that PS2 game sales don't compete with PS3s. Sony is slightly immune to "planned obsolescence" criticism, because they still sell PS2 consoles fairly cheap, and even PS1 consoles. And PS3s will still run PS2 games, just in SW. This PS3 rollout seems to be running quite sensibly, especially for the recently erratic Sony strategists.

Many of the numbers iSuppli comes up with are pretty much made up. Regardless, most news organizations assume that the entire difference between retail of the device and the iSuppli number is "pure profit," etc. - this is utter nonsense. Previous iSuppli numbers have been shot down by reason, I hope to see the same thing in this instance.

In this case, the author at Daring Fireball is aiming at the wrong target. iSuppli doesn't claim their numbers are anything other than what they are: the cost for the materials used in the product. They never claim that all the remaining portion is profit, if you read the actual press release, that's an interpretation provided by the media. iSuppli isn't screwing up here, it's just that reporters don't understand what they're reading.

The 360 is closing in on a year and a half after launch and instead of a price cut, they're going to charge us an extra 80 bucks for a new port and a hard drive big enough not to suck. M$ was making 75 bucks on each console they sold back in November. Guess I'll be stuck in the last generation for a while longer, or at least until it is possible to actually purchase a Wii.

http://www.isuppli.com/news/default.asp?id=6919 I tried to find it earlier and place it within my earlier post, but I failed miserably.

Or any cell customer who is not a fan boy of any tech companies: coverage and quality matter. The iPhone likely won't "change the market" as some dream but it will fill a niche. The ultimate size of the niche depends on how quickly the inevitable first generation problems are sorted out, and when the phone makers produce their responses. Typically Apple has huge margins, @ 50%, so they have plenty of room to cut prices should the need arise, http://www.isuppli.com/news/default.asp?id=7308&m= 1&y=2007 has estimates.

You must not follow the news. http://www.isuppli.com/news/default.asp?id=6919 I suspect MS isn't getting the whole $75, they are probably taking $50 and leaving retailers with $25 per unit, so that they have more incentive to push 360 sales.

30 games per PS3 is really a lot. Not being much of a console gamer myself, I don't know what the average games-per-console is, but that seems pretty high. Of course this figure depends on how much Sony can bring the cost of manufacturing down. Did the analysts assume that they would and factor it in, or did they assume a constant cost/console?

Here is a link to a cost analysis of the PS3 ( http://www.isuppli.com/news/default.asp?id=6919 )

The question I would have is whether Sony can bring the cost of manufacturing down at a rate greater than the rate they're going to be forced to reduce the price of the system?

Sometime in 2007 Microsoft will reduce the price of the XBox 360 so that the XBox 360 Bundle is $299 (as a guess), at this point in time Sony will be left with the decision to reduce the price of the PS3 or to reduce their loss on the PS3. If Sony allows Microsoft to Bully them into reducing the price of the PS3 it is likely that Sony will not start turning a profit on hardware throughout the entire generation (similar to what happened with the XBox), on the other hand if Sony doesn't reduce the price of the system they will likely bleed marketshare to Microsoft.

Honestly I hate Microsoft but the more I think about it the more I believe that Sony has lobbed the ball right into Microsofts court and ran off to get a drink while the ball is still in play; if Microsoft converts on this it will be really ugly for Sony.

The claim that you can't get iPod cost info is crap. Go to iSuppli and you can get a detailed bill-of-materials and materials costs on the latest (or older) iPods. You can argue that "oh iPod is >10%" but that's pathetic argument - once you're that big it there's enough collateral interest that you can easily find the info. If you're not that big, what you company does doesn't really matter. This is pretty basic stuff if you're doing financial analysis for a living unless you're a lazy *ss - like Greenberg apparently is - this is his job - he works for the fricking WSJ already. Boohoo! I can't find everything I need to know about a company in their 10K filing. Pull you head out of your posterior already. If WSJ can't be bothered to make the effort...

Financial statements are necessarily incomplete representations of the company. The truth is usually obscured as much by the "fog of war" and intent. If you want to see a more interesting case of intent, look at the latest 10K and 10Q of Affymetrix. They lead with the balance sheet instead of the usual income statement. That tells you pretty much everything you need to know. Not that I'm surprised it's come to that.

I constantly hear people complaining about how this or that isn't spoon-fed to them. At work I get job applicants and customers who ask why our software isn't like Powerpoint. Hey knob! If it were that trivial no one would need to hire you! Dorks! Neither softare nor interpreting corporate finances are one of those "Go to the freezer and get the box" kind of activities. Never will be. Oh yes, I've ended interviews and torn-up their resumes in their faces on occasion when I've gotten that comment. No morons please!