Slashdot Mirror
Inside the Third Gen iPod Nano
ahess247 writes "When the leaked photos of the 3rd-gen iPod nano first hit the Web it quickly took the nickname 'little fatty,' but fat could be better used to describe Apple's profits on the project. BusinessWeek reports that a teardown analysis by iSuppli finds that it costs Apple only $58.85 to build the 4-gig iPod nano, and $82.85 for the 8GB version. The analysis also reveals some of Apple's suppliers, about which it is usually very tight-lipped. Synaptics is back as the supplier of the click-wheel technology, beating out Cypress Semiconductor which had it previously. Also of note: The same Samsung CPU chip that powers the video and audio in the nano is being used in the iPod Classic as well."
You mean an Apple product is overpriced?
When you have a better analysis of what it costs to develop the software, the amortized cost of engineering and other non-hardware costs (marketing, managing, distribution, etc) so that we can see a margin. Those numbers (58.84$) are totally irrelevant and only serve to misinform. Sure, you could buy the pieces that price, but for what it's worth...
Of Code And Men
Are not all that go into the final street price. You got R&D, Marketing, Logistics.. Steve's Salary...
---- Booth was a patriot ----
Companies create and sell products in order to make money!
It is neat to see that the Nano has the same guts as the "classic" now, though.
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.
Yeah, the v3 Nano is cheaper to build. Its also cheaper to buy, with a 4 GB unit now $150 and $200 for the 8 GB, as opposed to 2 GB for $150, 4 GB for $200, and 8 GB for $250.
Test your net with Netalyzr
You mean an Apple product is overpriced?
That's one way to look at it, in the context of the whole marketplace. Another way to look at it is that they've priced it according to the amount people have told them they're willing to pay. So if it were cheaper, it would be underpriced for that particular offering from Apple.
The theory of relativity doesn't work right in Arkansas.
except for Apple ownership. Each person needs to decide if the retail price represents a good value to them personally. If it doesn't, don't buy it. It doesn't matter if it costs Apple 1 cent to manufacture the product. Thus is the nature of freedom. They can ask whatever they want, and you can pay it or not. FYI, the same thing applies to your salary.
R&D: $10 000 000
...
Marketing: $25 000 000
Logistics: $5 000 000
Steve's Salary: $1
Bringing a new iPod to market: $40 000 000+
Having your CEO cost less than your annual paperclip budget: priceless
Most things money can by; and if you have enough of it: you probably buy Apple.
**AA: a bunch of mindless jerks who'll be the first against the wall when the revolution comes
Of course it does. It is just like someone overcharging for plywood and batteries as the hurricane bears down. People need these iPods, and they need them now, and competitive products are not available. Apple execs should be put in jail for this immoral behavior.
Business Week:
After taking apart the nano, iSuppli estimates that all the parts inside cost Apple $58.85 for the $149 modelThere's also the retailer's cut. Retailers taking 60% of the final price is not unheard of.
I usually stop reading when I see "iSuppli."
I purchased a 3rd gen Nano for my wife. She is very pleased with it. She even manages to watch some of her favorite TV shoes on it. It might be slightly wide - but it is very thin. Our only complaint is the dozens of bugs. However, these all appear to be software based so hopefully most of the annoying ones get fixed soon. How hard is it to code something like coverflow? Please forgive me if I'm wrong - but that feature is by far the most buggy. I also can't say too many nice things about iTunes. Is apple trying to make it suck on purpose? That's what it seems like to me.
Including it's shortcomings we are happy with it overall. Being able to personalize the player by engraving the back actually was a selling point. It takes a dumb electronic device and turns it in to a sentimental keepsake.
Like parent says, when you buy any electronic gizzmo you're not just paying for the parts. You're paying R&D costs, distribution costs, profit for share holders and the stores etc.
It is quite common for electronic products to sell for apperox 5x the cost of the raw components.
Engineering is the art of compromise.
You're not offering offer a fair analysis of an economic situation if you reason about it axiomatically, from an impoverished set of axioms that assume that the parties to every exchange are perfectly rational, that what they value doesn't change by the act of purchasing, and that they possess perfect information. All you're doing is demonstrating that you have an unempirical adherence to the axiom that trade only happens because both parties wanted the trade to happen, and that whenever you see some situation that contradicts it, you will reject the existence or straightforward description of the situation.
You can always preserve your belief in a given claim by refusing to believe the things that would contradict it.
Are you adequate?