iPhone 3G costs $173 to build

via Mobile Entertainment


iPhone 3G is expected to carry an initial hardware Bill Of Materials (BOM) and manufacturing cost of $173 [£87], according to a “virtual teardown” conducted by iSuppli.

The company says the figure comes in 23 per cent cheaper than the original iPhone, for which it pegged per unit manufacturing cost at $226.

iSuppli says Apple’s iPod and iPhone products are typically priced about 50 per cent more than their BOM and manufacturing costs. This means that with the new 8GB iPhone 3G sold at $199 and the estimated subsidy of $300, Apple will achieve an even higher BOM/manufacturing margin.

Moreover, iSuppli says fluctuations in component pricing mean the BOM/manufacturing cost of the second-generation iPhone will fall 37 per cent to $148 in 2009.

iSuppli's full iPhone 3G cost breakdown is as follows:

• $22.80 8Gbyte NAND Flash Memory
• $20.00 Improved Touch screen
• $20.00 Display
• $13.50 Application Processor
• $5.00 1Gbit SDRAM - Mobile DDR
• $15.00 HSDPA Digital Baseband
• $7.00 2 Megapixel Camera Module
• $4.00 WLAN chipset
• $4.00 Battery
• $3.60 GPS
• $2.00 Motion Sensor / Accelerometer
• $4.25 RF Transceiver
• $1.89 64Mbit NOR Flash Memory, 32Mbit PSRAM
• $1.80 Charger (USB)
• $2.00 Bluetooth 2.0 + Enhanced Data Rate (EDR)

$126.84 Total of Above Items

• $37.16 Other Costs
• $164.00 Total Bill of Materials (BOM) Costs (Direct Materials Only)

$173.00 [£87] Total BOM & Manufacturing Costs

$199 [£100] Initial retail price, 8Gbyte Version

lol Apple you rourt us big time!