Monday, November 05, 2012

16GB wi-fi only iPad mini costs Apple $188 for a $329 retail price

The iPad mini debuted on Friday, to a somewhat tepid response, at least in terms of lines at retail stores. As it typically does, IHS iSuppli has done a teardown of Apple's new 7.9-inch tablet and estimated its bill-of-materials (BOM) cost.

At this point, only the wi-fi version of the iPad mini - and the fourth generation iPad, as well - has been released. The base model, which comes with 16GB of internal storage and sells for $329, costs Apple $188 to build. As you'd expect, higher storage tiers mean far more profit for Apple.

In detail, IHS iSuppli said 16GB of storage costs Apple $15.50, so extrapolating that, it then follows that the 32GB version adds only $15.50 in additional cost, the 64GB version has an additional $46.50 in storage cost. The would mean Apple would make (about) $84.50 more for the 32GB version and $153.50 for the 64GB version.

In other words, if you want to help Apple's bottom line more - and its stock has dropped precipitously recently, from a 52-week high of $705.07 to Friday's close of $576.80. On Friday alone, Apple stock dropped nearly $20.

Apple opted to eschew Samsung for the display, with LG Display (LGD) and AU Optronics (AUO) supplied the display components. The display cost about 43 percent of the total BOM, or about $80. The screen uses a new technology known as GF2 that allows the overall display to be thinner than on previous generations.

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However, since Apple opted to use the older A5 processor for the device, Samsung maintained its role as the processor manufacturer, continuing a longstanding - though contentious - relationship that dates back several years, predating the global series of patent lawsuits between them over Android-powered smartphones and tablets.

Apple is expected to unveil the cellular versions of the iPad mini and fourth-generation iPad in mid-November. Apple hasn't produced an exact date for the devices' arrival at retail outlets.

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