Does the storage difference justify the $$$ difference?

Discussion in 'iPad' started by Redjericho, Jun 23, 2012.

  1. Redjericho macrumors 6502a

    Sep 16, 2011
    I am curious, does it actually cost apple 100$ to bump the storage of the iPad from 16 to 32gb? Or even 32 to 64? Or is it all just another marketing trick?
  2. Rodster macrumors 68040

    May 15, 2007
    Absolutely NOT !

    Every time you pay $100 it cost Apple around $10. So they hope you upgrade the storage from 16GB. :D
  3. ixodes macrumors 601


    Jan 11, 2012
    Pacific Coast, USA
    Apples cost to increase the capacity is their business.

    Is it worth it? Only you can answer that for yourself.

    It's as simple as that :)
  4. Rodster macrumors 68040

    May 15, 2007
    I was off a little. It's actually $16.80

    “The NAND flash memory is one of the key profit-generating components for Apple in the new iPad line, as it has been in previous iPads and in the iPhone family,” Rassweiler noted. “Apple makes far and away more money in selling consumers NAND flash than NAND flash manufacturers make selling it to Apple. And the more flash in the iPad, the higher the profit margin there is for Apple.”

    For example, the retail price of the 32GB LTE-enabled new iPad is $100 higher than the 16GB model. However, Apple’s BOM for the 32GB version is only $16.80 more compared to the 16GB model.
  5. unibility macrumors 6502

    Apr 6, 2012
    supply and demand. :D
  6. Redjericho thread starter macrumors 6502a

    Sep 16, 2011
    Haha, I thought so. Man, that's $83.20 pure profit for apple per device sold and $166.40 for a 64gb model.

    If it was easier to open my device I'd install more myself, but apple has it locked down like a bank safe.
  7. Rodster macrumors 68040

    May 15, 2007
    Don't forget that it doesn't factor in shipping cost which is probably another $7-10 per unit from China, just a guess. And if you decide to return it, they pickup the tab for return freight. But yeah they're still banking in money with those profit margins.
  8. ocnitsa macrumors regular

    Jan 24, 2011
    This is it in a nutshell...once you fill that sucker up with media and pictures and ebooks and junk it's worth an extra 100 bucks to not have to worry about it and manage things...because we can't crack open the back and pop in a couple of memory sticks. Next best thing is stuff like dropbox integration for particular apps.
  9. Rodster macrumors 68040

    May 15, 2007
    Don't forget that the NAND Flash is soldered to the motherboard, that's the trade off but I do agree the profit margin is a bit much.
  10. kdarling, Jun 24, 2012
    Last edited: Jun 24, 2012

    kdarling macrumors demi-god


    Jun 9, 2007
    First university coding class = 46 years ago
    They cost the same to ship to the US, no matter how much Flash is installed.

    This is where the ability to plug in storage really helps over time.

    Buy an iPad 1, then the 2, then the 3... and it will total hundreds extra for getting more storage each time.

    With tablets that have add-on storage, the extra storage (at a much lower price to begin with) can often be bought once and reused on the next tablet purchase.

  11. chaoticbear macrumors 6502

    Jul 25, 2007
    While this is true, the resale on higher storage capacities also helps offset the initial investment.
  12. Rodster macrumors 68040

    May 15, 2007
    And you could add customer returns and return shipping along with advertising cost, etc. So yeah while Apple is making a nice profit from the iPad there are other hidden cost.

    And remember NO company is EVER on TOP for FOREVER. Ask Nintendo who was rolling in the dough selling their games and consoles. As the market changed they are now selling some of their game consoles at a lost.
  13. Redjericho thread starter macrumors 6502a

    Sep 16, 2011
    Maybe not forever, but apple will be there for quite a while if they don't screw it up. I mean, technology is the future, and nobody is better a technology than apple.
  14. Firesign3394 macrumors regular

    Nov 28, 2011
    Take a look at Sony in the 1980s...
  15. Kolmogorov macrumors member

    Apr 16, 2011
    Of course not. But if 16 GB is not enough for you, then you have to pay much more to get 32 GB or 64 GB. Because there are simply no other ways around.

    Some may want a $300 7.85 inch iPad mini, then they have to wait. Again, there are no other ways around.
  16. chris7777 macrumors 6502

    Nov 27, 2008
    Oh their are other ways around. My mom got a different brand of tablet.

    I want an I pad myself, but the memory issue is one of the things making me hesitate on pulling the trigger just yet.
  17. mark28 macrumors 68000

    Jan 29, 2010
    Apple is the richest company on the planet, what do you think?
  18. takeshi74 macrumors 601

    Feb 9, 2011
    Production costs and justification for the buyer are two entirely different things. It certainly doesn't cost Apple the price difference between the two capacities. Selling something at materials cost is not a viable business model. As for justification -- that's for you to determine based on your specific needs/wants. Plenty of people do justify the higher capacity devices. Whether you do or not is a different matter.
  19. Funkymonk macrumors 6502a


    Jan 7, 2011
  20. Redjericho thread starter macrumors 6502a

    Sep 16, 2011
    I was asking your opinion, does the 16 or 32gb difference seem justified to you personally for the 100-$200 upgrade?

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