iPhone 6 Component Costs Estimated to Begin at $200, Samsung Supplying Some A8 Chips

[cmaier]

Samsung still has the best chips

LoL. Based on what?

 

[CarlJ]

Next headline from iSUppli:

"5-carat diamond found to have parts cost equivalent to a box of pencils."

 

[AlecZ]

Not at all.

There are plenty of options in the cell phone market that provide to the customer identical user experience. And or at least, functionality.

Hell, an old Blackberry still makes phone calls, handles texts, emails, etc. with ease.

The attraction of an iPhone over a cheaper, easier to get Android device is that it is made by Apple.

The only counter argument would be investement in ecosystems. Assuming you've invested hundreds, or thousands into iOS applications. BUT, if thats the case, again, all that means is Apple has you locked in and as such can charge whatever they want.

The freedom for the consumer has never been more large, the choice made is made through emotional needs, not rational ones.

Sorry, the other smartphones most definitely do not provide an identical user experience. Same feature list does not imply same product. I don't care what's Apple and what's not, no matter how much you tell me I do, and I don't carry anything as a "status symbol". Yeah, some people do, but you can't generalize like that. By the way, most of my floormates have iPhones or Android phones, and the ones with Android phones (mostly guys) are the only ones showing their phones off. That's how it was in high school too. I think the iPhone was only cool/special in 2008-2010.

The only thing that matters to me is that Apple products have certain advantages over others, both for consumer use and for development (iOS programmers get paid $$$). The ecosystem is a good reason to buy an iPhone, but that's not what you were talking about.

 

[iThinkIt]

I like paper thin.. but as paper is thin it must cecum to outside influences.... What does paper do in your pocket?

 

[ghostface147]

What difference does it make?

Curiosity.

 

[eyehop]

Well then, I guess my subsidized phone wasn't so subsidized after all. Or perhaps it is I who is subsidizing my carrier by giving them a free phone with which they can lock me in for another few years. Profits for everyone, yay!

 

[ApfelSchaf]

This is the type of article which makes me feel like "I wish I new an insider from Apple."

Well there is "AppleInsider"... LOL... the articles are not worth much... mostly copied from other websites... but the user comments sure are hilarious.

----------

We like the phones. Not your doom and gloom tinfoil hat which makes you feel like you are smart because you see the matrix and no one else does. carry on....

btw we all care about money, not large corporations. Have a job? Why? Why not live in a van down by the river? Dont like the job? OK, open your own business. What? You have to make a profit? Ohhhhh nooooooo!!!

Kill yourself now.

LOL. I especially like the group-think in "We like the phones"

And, no, I do not like the new iPhones very much.

 

[MiWall81]

What about the Designers?

What about the programmers/designers/workers??? Whoever figured out these numbers needs to run a business for pity's sake... 69%!!!! I don't think so... The parts may cost up to $200 dollars, but the work that goes into programming/designing/building, changes a great deal as well...

 

[ApfelSchaf]

The truth appears to make you quite upset. Interesting.

As for killing myself... please. End a life over this ********? What sort of twisted world do you live in?

Ending one life is nothing! LOL

There is/was this tard posting under "Tallest Skill" who was actually hoping for a North Korean nuclear strike against South Korea as "punishment" for Samsung "stealing" the iPhone.

 

[doug in albq]

I am not surprised by the flood of Apple apologists who showed up on page 1, even before regular folks started making comments about Apple's massive profit margin.

 

[mabhatter]

Completely pointless test, as it's doesn't capture R&D costs.

You might as well price up raw glass, metal and plastic...

They get a steep discount for 10Million pre orders and 80M forecasted units. It's the "buy a factory" plan. Nobody except other PARTS makers are getting parts that cheaply because they don't have volume.

----------

Samsung still making the processors for their biggest consumer rival, the likes of which they mock commercially.

Makes it easy to believe in an oligarchical world where competition is an illusion :O

Be very afraid.

On the electronics world competition is both friend and enemy. It cost $1billion to roll out a new parts plant.. But it also drops Prices by 30% because one plant floods the market... Is all "on or off". so there is a lot of "taking your turn" in he industry so the dozen large manufacturers don't built two of the same factory at the same time and go broke.

 

[doelcm82]

I like paper thin.. but as paper is thin it must cecum to outside influences.... What does paper do in your pocket?

Even if the iPhone gets thinner every two years, we have a ways to go before we see paper-thin iPhones succumbing to outside influences.

How much longer will the iPhone even look like an iPhone? Do you think in twenty years we'll still walk around holding a rectangle with rounded corners in front of us?

----------

I am not surprised by the flood of Apple apologists who showed up on page 1, even before regular folks started making comments about Apple's massive profit margin.

We're not surprised by you either. You're so predictable!

 

[blackcrayon]

Can you believe how much Microsoft charges for Office 2013? There's no way printing that box and burning that DVD can cost them $139...

 

[name99]

Not surprising since 20nm is fairly new. Costly move for Apple though - verifying the design on two different processes. I'm sure they're paying a premium for those 20nm wafers.

The same.

"Costly move for Apple though". Not if they plan to move to the A8 as the new baseline CPU for the entire iOS lineup. IMHO this makes sense because it has an h.265 decoder in it, so it's ready for the future in a way that that old workhouse the A5 is not. I'd expect the next Apple TV and iPod Touch to be based off the A8 (perhaps binned versions --- iPod Touch gets slower low-power versions, aTV gets slower slightly higher power versions), and we might expect them to keep using this same chip for three or four years.

It's also possible that this time Apple will also provide a GPU-boosted A8X. This seems more plausible than for the A6 and A7 if we believe the rumors of an iPad Pro because such a device has another boost in the number of pixels over and above the iPad's retina display, and as a "pro" product one would presumably have even less tolerance of the occasional glitch in the user interface smoothness.

 

[JeffyTheQuik]

R&D: $750M
Advertising: $0

News stations, lines around the buildings, webpages, and fanzines are priceless on launch days.

The funny thing is Apple can charge $100 more for the phone, and people would willingly pay more*, which proves the point that demand drives price, not the cost of the goods sold.


*Applecare, anyone?

 

[musukosan]

You aren't paying for the phone 3 times over. Wish people would stop saying this. You can't include price of the service(which is what everyone pays, regardless if you bought outright or on contract), in the price of a subsidized phone.

While the poster you quoted is incorrect, you are completely correct either.

There is no such thing as subsidy. You pay for the phone no matter what.

Ever notice that 15 dollar/mo line fee per smart phone... that's where they make the money back. Base model new iPhone = $650. Upfront cost of two yr contract = $299. $15 x 24 months = $360. 360 + 299 = $659.

And actually, it just recently GOT worse. Both AT&T and Verizon (that I know of) now charge $40/mo for smart phone access fee. So now a two yr contract cost $1259. Now, if you do their Next or Edge program you end up only paying the cost of the phone plus tax IF you have one of their higher shared plans. For example AT&T gives you a 25 dollar credit on shared data plans of 10GB or more. 2GB it's a 15 dollar credit. Same if buy the phone out right. If you are on a 2 yr contract that started before they made these changes then you probably see some sort of credit on your account to make your bill the same as it was before the change.

They are getting their money for the smart phone one way or another (barring a few exceptions).

 

[Keirasplace]

I am not surprised by the flood of Apple apologists who showed up on page 1, even before regular folks started making comments about Apple's massive profit margin.

Apple's gross margin, exactly the same since 2008... So, you think we haven't absorbed this news yet? That we are surprised. If we're still here its because we actually think there is value in those phones. Why are you here is the much more profound question?

Preaching the gospel of troll to the uninitiated?

 

[tevion5]

Adding the total cost with the carrier for the life of the contract, yes you do pay more that the cost of the phone.

However, paying full price for the phone doesn't get you a better data plan here in the US(ATT, Verizon). So you are going to pay roughly the same amoun over a 2 year period for service.

I pay 10 bucks a month for 1Gb Data, 300 Mins calls and unlimited texts to any network.

My network also offers for 20 bucks, unlimited everything for a month.

Combine that with an off the shelf iPhone and there is no competition at all with any contract.

----------

Remember, all of these large corporations care for one thing and one thing only... money.

The rest is an illusion perpetuated by their own exclusive fan base.

Apple fans are convinced that Jobs and now Cook really care about them as people. And through that, want to provide their customers a personalized welcoming experience. The reality is, that's all imaginary. All they want is to turn huge profits, make their stock holders happy and keep their jobs for as long as possible.

*REALITY

Exactly

That said I love Apple's products in general because I think they do their job aspiringly and look sexy while doing it. But I try to keep reminding myself that they are products sold by a profit making corporation.

Beauty is in the eye of the consumer.

----------

Some of you guys would still be waiting for Iphone 6 plus if it wasn't for Samsung supplying those processors...

Samsung make some nifty processors. They must have great engineers

Rubbish marketing and design team IMO ("How about this year guys, we make another plastic oval?" ), but they have many strengths as a company.

----------

You aren't paying for the phone 3 times over. Wish people would stop saying this. You can't include price of the service(which is what everyone pays, regardless if you bought outright or on contract), in the price of a subsidized phone.

Nope. Wish people would learn elementary school math before posting on forums. Add it up. Find me one contract where it's cheaper or the same price as getting the iPhone unlocked and using a network without a contract.

I'll wait.

(This is my network: http://48months.ie)

 

[cmaier]

Samsung make some nifty processors. They must have great engineers

The design is by apple engineers, not tsmc engineers and not samsung engineers (I still say there is NO evidence that any samsung A8s exist. ChipWorks hasn't found them yet, and i'll believe them when they say they exist, but won't believe hearsay originating at a firm that has no demonstrated technical ability to reverse engineer die).

All tsmc and samsung do is MAKE the chips, which is largely an automated process using input data provided by Apple.

 

[tevion5]

Not at all.

There are plenty of options in the cell phone market that provide to the customer identical user experience. And or at least, functionality.

Hell, an old Blackberry still makes phone calls, handles texts, emails, etc. with ease.

The attraction of an iPhone over a cheaper, easier to get Android device is that it is made by Apple.

The only counter argument would be investement in ecosystems. Assuming you've invested hundreds, or thousands into iOS applications. BUT, if thats the case, again, all that means is Apple has you locked in and as such can charge whatever they want.

The freedom for the consumer has never been more large, the choice made is made through emotional needs, not rational ones.

User experience on Android has improved dramatically in recent years. I think I was forced to use one now I could get by.

However, I still don't like the little delay in opening apps, or the occasional jitter that occurs when swiping on a menu. Nonsense for a phone with a quad core processor and capable of 1080P playback

Apple make some interface godsends. OS X is hands down the most pleasant file manager and environment for Audio Production, Graphics work, or Video editing around.

And one of the most awesome products Apple make that is essentially a UI product that never gets much attention is....

....Server.app combined with an Airport Base Station.

Want to set up an FTP server? One switch. Done. Literally. Edit Port, NAT, PPPoE or DNS settings?

Open my iPhone App and click click done.

Best networking in the world end of story.

Hell if Apple networking products were used in conjunction with Mac's (Not a cheap solution indeed) in every school/home/small business, I dare say half of all IT companies would have to shut down. The stuff would work to often and too easily to warrant half their occupation.

$700 for a phone is very steep and a little crazy alright. But god damn don't tell me their interfaces aren't the best around.

----------

The design is by apple engineers, not tsmc engineers and not samsung engineers (I still say there is NO evidence that any samsung A8s exist. ChipWorks hasn't found them yet, and i'll believe them when they say they exist, but won't believe hearsay originating at a firm that has no demonstrated technical ability to reverse engineer die).

All tsmc and samsung do is MAKE the chips, which is largely an automated process using input data provided by Apple.

Do they actually? I never thought Apple was capable of designing an actual processor from scratch.

I mean, Intel make the chips of PC's and you never see Dell or HP or Acer being involved in chip design.

From my understanding Apple takes part in designing the integration of the different components and will request some weird and wonderful shapes and sizes that drive engineers to madness to fit in MacBook Air's and whatnot, but I never thought they went to the extent of designing processors entirely.

Can you show me evidence of this?

 

[JCrz]

don't forget the software!

What hurts Apple is that they spend a ton of money on software developers to write iOS. Android phone makers don't have that expense.

 

[fertilized-egg]

Agreed. I hope Chipworks tries to acquire one of these devices.

(I still say there is NO evidence that any samsung A8s exist. ChipWorks hasn't found them yet, and i'll believe them when they say they exist, but won't believe hearsay originating at a firm that has no demonstrated technical ability to reverse engineer die).

Yes, I'd really love to see the evidence as it'll be a pretty amazing feat on Apple's part to multisource fabs for a sophisticated chip like this. I don't recall seeing anybody doing it successfully at this level. I've read Qualcomm has done it with their modem chips but their SoCs are all from TSMC so far.

From my understanding Apple takes part in designing the integration of the different components and will request some weird and wonderful shapes and sizes that drive engineers to madness to fit in MacBook Air's and whatnot, but I never thought they went to the extent of designing processors entirely.

Can you show me evidence of this?

While they license IPs from others for many blocks in the SoC (as does everyone else) Apple really did design the cores. http://www.linleygroup.com/newsletters/newsletter_detail.php?num=4881 Why is it so unbelievable though? Apple bought a number of chip design firms over the years.

Samsung make some nifty processors. They must have great engineers

If you think Samsung is great for making Apple's chips, TSMC has been making the following chips for years now.

- nVidia graphic chips
- AMD graphic chips
- Playstation 4 processor
- XBox One processor
- Qualcomm Snapdragon processor, used by Samsung and virtually every top Android maker
- Qualcomm modem chips, used by virtually every top handset maker including Samsung and Apple
- MediaTek processors, used by most low cost Android makers
and more

Yet I don't see any Android users fawning over TSMC. Having special attachment to Samsung as a fab is a special behavior only observed in Apple naysayers.

 

[Bubba Satori]

What hurts Apple is that they spend a ton of money on software developers to write iOS. Android phone makers don't have that expense.

Well apple didn't have to hire file system, multitasking, removable storage, Quad HD display
or smart stylus developers. So they saved a bunch o'money there.

And in what respect is Apple hurting?

 

[chrmjenkins]

Yes, I'd really love to see the evidence as it'll be a pretty amazing feat on Apple's part to multisource fabs for a sophisticated chip like this. I don't recall seeing anybody doing it successfully at this level. I've read Qualcomm has done it with their modem chips but their SoCs are all from TSMC so far.

Yes, Qualcomm went to UMC for modems when their 28nm products were taking off like crazy and TSMC didn't have great volume yet.

 

[iososx]

As a long time volume shareholder this is great news.