Samsung Galaxy Tab Cheaper to Manufacture than Apple iPad: iSuppli

Samsung's Galaxy Tab costs less to manufacture than rival Apple iPad, according to research firm iSuppli. But will that affect consumers' buying decisions?

Samsung's Galaxy Tab is an iPad competitor in more ways than one, apparently: According to research firm iSuppli, the Android-powered tablet PC's parts cost $205.22, less than the estimated $264.27 for the 16GB iPad with 3G. Combined with an estimated manufacturing cost of $9.35 per unit, iSuppli's grand total for the Galaxy Tab rises to $214.57.

The Galaxy Tab's 7-inch TFT-LCD display is responsible for the bulk of that lower cost-at an estimated $57, it lags far behind the iPad's 9.7-inch screen at $98. The screen accounts for 27.8 percent of the Galaxy Tab's bill of materials (BOM).

"Instead of matching up with the iPad on a feature-by-feature basis, the Galaxy Tab really is [a] larger version of Samsung's Galaxy S smart phone," Andrew Rassweiler, director, principal analyst and teardown services manager for iSuppli, wrote in a Nov. 1 statement. "While the design approach makes the Galaxy less expensive to produce than the iPad 3G, it also makes for a product that lacks the same usability."

The crucial element in the comparison, Rassweiler continued, is the screen. "The Galaxy Tab's screen resolution, size and technology are not at the same level as the iPad. This is a critical difference, given the fact that the display is a key differentiating factor for the iPad." The Galaxy Tab offers 1,024 x 600 resolution, compared to the iPad's 1,024 x 768.

Behind the $57 screen, the Galaxy Tab's next-largest cost is its memory subsystem, at $51. The subsystem combines a Samsung multichip package with 16GB of NAND flash memory from SanDisk. After that comes "numerous mechanical and electromechanical components," with a combined cost of $15.22.

In fourth place on iSuppli's list comes the user interface subsystem, including the gyroscope and capacitive touch-screen controller, at $13.87. The battery costs $10.60, the baseband system $10.07, and the radio frequency/power amplifier subsystem $9.09. Those are followed by the applications-processing subsystem at $8.84.

In its bid to compete against the iPad, the Samsung Galaxy Tab will debut with multiple carrier partners. T-Mobile will market the device in the United States Nov. 10 for $399 with a two-year data plan, narrowly beating Verizon and Sprint to store-shelves. U.S. Cellular and AT&T will also offer the Galaxy Tab. Data plans vary between the carriers, ranging from Verizon's monthly "pay as you go" data plan to other carriers' two-year data contracts.

Samsung first unveiled the Galaxy Tab for American audiences Sept. 17, with an event at New York City's Time Warner Center. The manufacturer hopes that the tablet's 3G connectivity, video conferencing, Android 2.2 operating system and support for Adobe Flash will all help differentiate it from the Apple iPad, which shipped 4.18 million units in the fiscal 2010 fourth quarter.