Posted on 09/23/2005 10:44:33 PM PDT by martin_fierro
2GB iPod Nano costs $100 to make - researcher
By Tony Smith (tony.smith at theregister.co.uk)
Published Friday 23rd September 2005 14:54 GMT
Market watcher iSuppli has disassembled Apple's iPod Nano and, beneath the shiny but not entirely scratchproof (http://www.theregister.co.uk/2005/09/23/ipod_nano_scratching/) casing, it has found almost $70 worth of assorted chippery.
The 2GB Nano retails in the US for $199. Of that, iSuppli reckons, less that half - $90.18 - goes on components. Chuck in $8 per unit labour costs, and Apple's base margin is a whopping $100.82. You can probably add a little more for software development - they're paid in pizza, no?
iSuppli notes that the player contains PortalPlayer's 5021C audio controller chip, Wolfson's WM8975G codec part and a Cypress CY8C21x34 system-on-a-chip used to manage the input from the device's clickwheel.
PortalPlayer's products have found their way into all the iPods Apple has sold with the exception of the Shuffle series, which use a SigmaTel part - the STMP3550, according to iSuppli, which has presumably taken one of the screenless, Flash-based players apart too.
The clickwheel is believed to be the first one Apple has made itself, dropping former clickwheel supplier Synaptics - better known as a purveyor of notebook trackpads - in favour of a cheaper home-brewed alternative.
The key cost-saving component, however, is the Samsung-made NAND Flash. The 2GB Nano contains two 1GB Flash chips. Assuming claims that Apple has received a big volume discount from Samsung are true, iSuppli said it believes the memory costs $54 in total.
You can find a more basic dissection of the Nano here (http://arstechnica.com/reviews/hardware/nano.ars), courtesy of Ars Technica, but iSuppli's more expensive version ($499 - more than twice the price of the Nano the company took to bits, so Apple's not the only one making nice margins) comes with a much deeper-level analysis of the player's bill of materials (BOM) and other cost data. Ideal, in short, for consumer electronics designers who don't fancy tackling deconstructing the Nano themselves.
You don't think that union wages, manditory health insurance, workers comp, unemployment benefits, Americans with Disabilities Act, etc. would increase the labor costs on an Ipod from $8 each? Get real!
(Don't forget all the components are also made overseas.)
It seems logical that if Ipod could have mede them as cheap in the USA, they would have done it. "Buy and Ipod. It's made in the USA!") But they didn't.
$950 for this basically worthless trinket.
Oh well. I guess one man's trinket is another's treasure.
And you win the award for Grumpy Old Fart/Low Testosterone Post Of The Day. Wonder what that's worth.
Let us not read The Register. It is a silly paper.
I never said the cost would not increase. I simply asked why costs would DOUBLE.
Because people will pay it.
Do I win an IPod? :)
Must be one of those "profit" scams I keep hearing about.
How much extra do you think $200 Ipod shoppers would pay for the device? $100 more? $200 more? $500 more?
The iPod nano, like most modern consumer devices, requires very little human contact to build. I doubt that the china side of the equation requires spending 8.00 on labor per unit.
I can buy numerious items made in the USA that require a lot more labor to put together than the iPod nano and it doesn't add 100.00 to 500.00 to the cost.
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