The $499 iPad costs Apple $270 in materials & manufacturing

Discussion in 'iPad' started by colmaclean, Feb 3, 2010.

  1. colmaclean macrumors 68000

    colmaclean

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    #1
  2. roland.g macrumors 603

    roland.g

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    #2
  3. robbieduncan Moderator emeritus

    robbieduncan

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    #3
    I seriously question the accuracy of the figure. This is a device that no one has so cannot have completed a tear-down containing components that Apple design and have manufactured uniquely for them that are not available for sale. So the cost of those components (the A4 CPU in particular) is a guess. Yes perhaps an educated one but a guess all the same.
     
  4. maflynn Moderator

    maflynn

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    #4
    Those figures and articles are never accurate. They fail to properly take into consideration the overhead, actual price (how much of a discount apple gets) and R&D costs in designing the device.

    Yeah, out of pocket expense of the parts will be (and should be) less then the the retail purchase price. I might have missed it, but I didn't see any mention of assembly expenses, packaging, marketing etc. So while the expense is less then the asking retail price, I'm not sure the profit margin is as wide as they postulate.
     
  5. VenusianSky macrumors 65816

    VenusianSky

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    #5
    Call me crazy, but I figure that Apple also pays their employees. That money has to come from somewhere.
     
  6. bozzykid macrumors 68020

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    #6
    Those articles always mention that fact too. They are only pricing the parts included in the device. I don't see why people freak out about such research.
     
  7. lordhamster macrumors 6502

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    #7
    People freak out because inevitably some pinhead comes on the forums and claims Apple is ripping people off because it only costs $x to manufacture but they sell for $x + y.

    This thread has been surprisingly levelheaded.
     
  8. topmounter macrumors 68020

    topmounter

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    pinhead can always buy the parts and build his/her own :)
     
  9. JackMaurer macrumors member

    JackMaurer

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    #9
    Even if it cost them $1 to manufacture and they sell it for $1000....

    Apple is NOT forcing you to buy it...and people know how much something is before they buy it...so how can they be "ripped off"
     
  10. lordhamster macrumors 6502

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    #10
    Beats me. Since all purchases are consensual I have no clue how anyone ever claims this. But go back to when they dropped the price of the iPhone, everyone was suddenly outraged that a company had dared to make a profit off early adopters.
     
  11. colmaclean thread starter macrumors 68000

    colmaclean

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    Even if the figures don't tell the real story, it's interesting to note that as always for Apple the iPad's memory upgrades come at a considerable premium.
     
  12. NT1440 macrumors G4

    NT1440

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    Uh, who has been able to get ahold of one and actually part out the device?

    I hate speculation based off speculation for the sole purpose of more speculation.
     
  13. colmaclean thread starter macrumors 68000

    colmaclean

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    #13
    That's the glue that holds this forum together!
     
  14. bozzykid macrumors 68020

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    #14
    It isn't hard to speculate on the flash memory costs. And as has been the case for years, Apple clearly hikes the price of memory upgrades beyond what most people would consider reasonable considering there are no extra costs involved. I'm sure someone will reply with a snarky response telling me I don't have to buy it if I don't want it. But it is still a valid point.
     
  15. lordhamster macrumors 6502

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    Of course Apple will charge a premium for additional memory. Seems like a given. Like saying the Sky is blue.
     
  16. maflynn Moderator

    maflynn

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    #16
    Because people start using those articles as gospel, its an incomplete picture that will only serve to confuse matters and fail to accurately report the costs. It does nobody any good by saying that it only costs apple 270 dollars to build an iPad.
     
  17. zemzabob macrumors regular

    zemzabob

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    #17
    It cost what it cost bottom line i don't care lol
     
  18. Chaos123x macrumors 68000

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    #18
    How much R&D does it take to make the iPod touch bigger? :eek:
     
  19. lordhamster macrumors 6502

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    #19
    Must not be that trivial, otherwise you'd be writing that comment on your Chaos123-Pad while on the back of the Yacht you bought with all the profits. ;)
     
  20. bozzykid macrumors 68020

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    #20
    Considering they are using an all new chip, I would imagine quite a bit of work went in to getting the iPhone software to work for that chip. My guess is that is why you don't see that many user facing changes in 3.2.
     
  21. Chaos123x macrumors 68000

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    #21
    Almost did that. But saw how much trouble Pystar got into so I decided to make a oversized Motorola Razr instead.... didn't sell well. ;)
     
  22. samcraig macrumors P6

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    #22
    Gee. What happened to the iPad being such a steal at 499. Now there are complaints that Apple is making a profit. Damn Apple! ;)

    Who cares if it costs $1 or 1,000. If you want one and it fills a need for you and you find enough value to purchase one at 499, then that's all that matters.

    If you don't find value in spending 499 for it - don't buy it.
     
  23. zemzabob macrumors regular

    zemzabob

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    #23
    Well said!
     
  24. Dammit Cubs macrumors 68000

    Dammit Cubs

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