IHS iSuppli performed a teardown of the 32GB, 4G iPad and found the new tablet costs Apple, in total, $375. That's more than 50 percent of its $729 retail price. However, the biggest beneficiary may be Samsung, which supplies a number of different components.
The new Apple iPad reveals
something about what Apple is willing to do to stay on top of the tablet food
chain: spend more. That desire roughly translates into $85 more per unit.
While Apple starts the
pricing of its third-generation iPads at $499, exactly where it did with iPad
2, the new tablets are far more expensive for it to make. One could argue that Apple,
sitting atop a gargantuan mountain of cash
, is willing to take a small hit
to profits. Or, and perhaps more likely, it's taking the calculated risk that a
better iPad at the old iPad pricein a market already filled with tens of
millions of iPadswill mean more iPad sales. And more cash.
The third-generation 16GB
iPad with WiFi carries a bill of materials (BOM) of $306, according to IHS iSuppli
, which performed
a teardown of the new tablet. Add in 4G and the BOM rises to $348. Add in
manufacturing costs, and it's up to $358. That doesn't include software,
licensing or royalty costs.
The 32GB 4G model, with
manufacturing, costs Apple $375 a tablet; the 64GB model, a total of $409.
The 16GB WiFi-only iPad 2,
by contrast, carried a BOM of $237; add 3G and it was up to $263. Throw in
manufacturing, and Apple's total bill climbed to $271.
Who is on the receiving end
of these payments? More than any other manufacturer, it's Samsung. The South
Korean company is the recipient of about 30.2 percent of the BOM from the 32GB,
LTE iPad. Samsung also supplies Apple with display technology and the
Of course, Samsung produces
its own tablet linethe Galaxy Tabwhich competes with the iPad.
Samsung may have also supplied
the NAND flashat a cost of $33.60 to the 32GB Long-Term Evolution (LTE) iPad
or $67.20 to the highest-end modelthough in the particular iPad that IHS took
apart, the NAND was from Toshiba.
In addition to Samsung,
"Toshiba, Hynix Semiconductor and others are all NAND suppliers to Apple,
and each will claim a portion of those revenues," IHS reports. In
instances where Samsung is indeed the supplier, however, its share rises to
39.4 percent, or $33.60 of the total $143.60 for the 32GB LTE iPad.
Also possible, says IHS, is
that Samsung provides the new iPad's $32 battery cells, which would drive its
portion of the BOM to nearly 50 percent.
That Samsung display is
not-so-arguably the Apple iPad's best feature. (Walt Mossberg, writing for The Wall Street Journal
, called it "the
most spectacular display
I have ever seen in a mobile device.")
But it's also the most
expensive display. At $87, Apple pays $30 more for it than it did for the
displays on its second-generation tablets.