Apple iPad Components Cost About $260, iSuppli Says

Sure the Apple iPad looks unique, but viewed from the inside out, it represents a more “radical departure” from traditional electronics design than might be expected, said iSuppli in an April 7 report.
 
During a recent teardown of the iPad, iSuppli not only discovered that the device likely costs more to make than iSuppli originally estimated, but that nearly 44 percent of the costs involved are related to the display, the touch screen and other user-interface components.
 
“While the iPad has the potential to change the game in the computing, wireless and consumer worlds, it already has changed the game of how many electronic products are — and will be — designed,” Andrew Rassweiler, a principal analyst and teardown services manager for iSuppli, said in a statement.
 
“The iPad’s design represents a new paradigm in terms of electronics cost structure and electronic content. Conventional notebook PCs are ‘motherboard-centric,’ with all the other functions in the system — such as the display, the keyboard and audio — peripheral to the central microprocessor and the main Printed Circuit Board (PCB) at the core,” Rassweiler explained. “With the iPad, this is reversed. Everything is human-machine-interface-centric, with the PCB and [integrated circuits] all there to facilitate the display of content as well as user inputs.”
  

To view images of the Apple iPad teardown performed by RapidRepair, click here. 
  

During a “virtual teardown” in February, iSuppli gave the iPad an estimated BOM (bill of materials) total of $219.35, and $229.35 with manufacturing costs. After a physical teardown of a 16GB, WiFi-only iPad, however, the firm upped the BOM to $250.60, or $259.60 with manufacturing expenses. None of these totals includes fees for software, royalties or licensing fees, which Apple surely also foots.
 
At $65, the iPad’s most expensive component is its 9.7-inch TFT-LCD display, representing more than one-fourth of the overall BOM. The touch-screen assembly, from Wintek, is estimated at $30.
 
“The display represents a customized implementation of an IPS panel, driving up its cost relative to a more commoditized netbook panel,” said Rassweiler.
 
iSuppli lists LG Display as the display’s supplier, but adds that Apple is likely working with two, if not more, additional suppliers.
 
Other components notably driving up the iPad’s BOM include a fee of $32.50 for “all enclosure metals, plastics, PCB substrates, connectors, etc.,” $29.50 for NAND Flash, $19.50 for the A4 microprocessor core integrated with a graphics processing unit and $21 for the lithium polymer battery pack.
 
In the iPad that iSuppli tore down, the battery cells were supplied by Amperex Technology and the pack was from Dynapack. iSuppli writes that it didn’t expect to find the battery cells “kitted as a pack” — something that can be seen in the RapidRepair slideshow link above — which suggests that the “batteries are meant to be replaced at some point.”
 
RapidRepair CEO Aaron Vronko also found the batteries of note, telling eWEEK after an April 3 teardown that “there was a bit of an evolution from the iPhone to the iPhone 3G S to the iPad. We think it’s going to make a big impact.”