Market Researcher IHS iSuppli
has revealed that since the Apple Inc.(NASDAQ:AAPL) iPhone’s
debut in 2007, the iPhone 5 is the most expensive handset till date. A bigger
screen, better touchscreen technology, and faster processor, has pushed up the manufacturing
cost of the 16 GB entry- level iPhone 5 to $207.
The iPhone accounts for two-thirds
of its profit from handsets and the number of pre-orders for the iPhone 5 has
already broken records of its predecessors. The manufacturing and
bill-of-materials expenses for the entry-level handset comprise 32% of the
non-contract sales price of $649. Carolyn Wu, a Beijing-based spokeswoman for
Apple, has refused to comment on the issue. Non-contract prices are not listed
on the Apple website because orders are only available via contracts with
carriers.
The 16 GB model is made of materials
that come up to $199 and the manufacturing cost is $8. For the 64 GB
version, the cost shoots up to $238, which is priced at $399 as the extra storage
is expensive. The first iPhone in 2007 had only 4GB storage. A slightly better
version with 8GB storage had a manufacturing cost of $265.83, as per iSuppli.
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Apple has not been too happy with earlier break-downs of
the manufacturing costs of its devices. Apple CFO Peter Oppenheimer has said in
July that the third-part reports are incomplete as many cost categories and the
components are missing. iSuppli has stressed that the analysis excludes
software, royalty, licensing, research marketing, administrative and other
expenses in terms of sales and design.
Wireless chips for the iPhone 4S went up to $34 from $24
and the display and touchscreen expenses went up from $37 to 44$. However,
memory chips underwent a fall in price, which is why the cost of storage is low
by 45% in the most expensive model with 64GB
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