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iPhone 5 costs $168 in parts to make!
- Thread starter Big.Mac.Daddy
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Yeah, those things obviously don't cost much when the amount of money Apple has in the bank is growing by over $20B a year at this point.
They design everything themselves, save for some parts like the camera and the baseband, but they outsource the production of it all.
I decided not to pound my head against a wall repeatedly today so I went to Yahoo instead to see what's going on in the world. They have a horribly misleading article posted about how much the iPhone 5 costs to make and they imply that the rest is pure profit for Apple. Thankfully there are people on this site who are smart enough to know that there is a lot more that goes into the cost than just the physical parts. I was amazed at some of the comments people were making on the article. It's like they all think that everything they've ever bought in their lives cost them exactly what it cost the company to produce it. Unfortunately, I think it shows a disturbing trend in how people view businesses in America, but that is a topic for another day. Anyway, just wanted to give props to the people on MacRumors who are smart enough to understand this one.
These threads pop up every time there's a new iOS device release. The authors always, without fail, ignore the fact that payroll is the single largest expense that any company has. Apple pays for designers, engineers, artists, secretaries, janitors... you name it. Not to mention the distribution channel, marketing and many others. Of course the components cost far less than the retail price. If they were even close Apple would go broke, taking a huge loss on each hand set. The only time you see component price match sale price is when the company is using the product as a loss leader. The Kindle Paperwhite for example.
