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iSuppli: The iPhone 3GS Costs $178.96 To Build; $4 More Than Previous Model
iSuppli Official Estimate: The iPhone 3G Build Price is $174.33

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Koztah
06/24/09

In reply to iSuppli: The iPhone 3GS Costs $178.96 To Build; $4 More Than Previous Model
Okay.

So if the iPhone costs 180$ to make, and sells (contractless) for 600-700$ directly from a service provider.

Wouldn't Apple make an incredible fucking killing if they started selling unlocked iPhones at 350-450$?
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Martin Przybylski
06/24/09

In reply to iSuppli: The iPhone 3GS Costs $178.96 To Build; $4 More Than Previous Model
if i could only buy all those parts for 179$ and put one together myself, i opened plenty of iphones to replace the screens on and its pretty much became a hobby to me now. 179$ to put it together ur self... ill take it
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OMG! Bacon!
06/24/09

@Martin Przybylski: Very doubtful you will be able to get all the pieces one at a time. It's most likely very high minimum orders.

But if you could, that would be hawt! Also, probably some type of copyright infringement or something?
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GitEmSteveDave_DefinesTurgid
06/24/09

@OMG! Bacon!:

ALFRED: We order the main part of this iPhone from Singapore.

BRUCE: Via a dummy corporation.

-Indeed. And then, quite separately, we place an order

to a Chinese company for these.

- Put it together ourselves.

- Precisely. They'll have to be large orders, to avoid suspicion.

- How large?

- Say 10,000?

- Well, at least we'll have spares.

- Yes.
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Sportyboard
06/24/09

In reply to iSuppli: The iPhone 3GS Costs $178.96 To Build; $4 More Than Previous Model
I've often wondered why there's so much outcry over carrier price gouging, when it seems that cellphone makers also really hike up the price. Isn't an off-contract 3GS $600? That's an over 200% markup.
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Justin Paulson
06/24/09

@Sportyboard: Um i think you forgot a few costs....manufacturing, shipping, warehousing, research and development, infrastructure to enable app store...etc...etc...etc. Just because the PARTS cost 178.96 does not mean that the device cost 178.96 to put in the consumer's hands.
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Sportyboard
06/24/09

@Justinpaulson: True, but you have to keep in mind that most components of the iPhone are not "new" inventions, the App Store makes money in its own right, and so on. I find it impossible to believe that the cost per device beyond the raw materials would be anywhere close to $400.
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Kaiser-Machead
06/24/09

@Sportyboard: People often blame the distributor for the prices of the wares they sell, rather than the maker of said wares. A lot of people aren't even aware of the price of an unlocked phone, simply because the subsidized price is usually the one on the big label in the stores.
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Justin Paulson
06/24/09

@Sportyboard: You don't think the salaries of all the engineers that went into creating the iPhone was more than a few million dollars? Or the costs to assemble the phones (which is actually pretty cheap) R&D is not cheap at all, engineers are not cheap. It's not as easy as throwing a few chips together and baam they work, there is a LOT more going on in the engineering of a device. Just because the component is not "new" does not make it any easier to place into a device. Lastly, apple not only has to recoup all of those expenses but they also have to make a profit for their shareholders. If they sell the phone at $400 that only leaves $100 per device to put back into all of the R&D and manufacturing and shipping etc. $100 per device?? I'm guessing they have over a dozen engineers that make $100 an hour to work exclusively on iPhone, not to mention dozens more engineers that make less than that. Until you have actually created a device from scratch and seen the amount of time (which is money) and cost that goes into it, you should't speculate on how much they are "gouging" you.
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Sportyboard
06/24/09

@Justinpaulson: If you take a look at the numbers, it does seem to be a bit ridiculous. Let's be conservative here and suggest that Apple makes $300 on top of the cost of the raw components for each iPhone sold. 21.17 million iPhones later, Apple has made $6,351,000,000 that would go towards R&D for the iPhone. Even if you believe in an "Apple Tax", I don't think there's any way it has cost anywhere near 6 billion dollars to design the iPhone.
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Falsoman
06/24/09

@Sportyboard: But even if the R&D cost were $0 (Wich they are not, looks the same =/= is the same), you still need to pay for manufacturing, testing, transportation (about three of those), graphic design (box, manuals and stuff like that), packaging, ftc aprooval, publicity and promotions, sales force, and who knows how many other things. Including brand free software updates for at least two years.

When you buy ANY product or service you are paying for all of those. Including the Pre (wich is even less expensive to make than this iphone)

If you buy a coffee it costs them about 50 cents in materials or less to do it, yet you pay 5 bucks. You don't buy JUST the materials.

Also there's the thing that contrary to popular belief, not everything sells better if it's cheaper. Depending on your market, sometimes selling things more expensive that they really are is the only way for them to be deemed worthy. Just go for the cosmetics industry and see what happens if they'd sell face creams and make up for half the price...

AND also if you want to know how much money apple is really making of their stuff you just have to go and check their anual reports. You'd see that they actually make about 12-16% profits, wich is A LOT for a company that size, but is much less than people seem to think.
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LuckyLakey
06/24/09

In reply to iSuppli: The iPhone 3GS Costs $178.96 To Build; $4 More Than Previous Model
Which would explain the same cost for the consumer to buy this now vs. the 3g when that came out
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Hello Mister Walrus
06/24/09

@LuckyLakey: This also implies that AT&T is sucking all the money from the monthly fees that supposedly "subsidize" the iPhone price.
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GitEmSteveDave_DefinesTurgid
06/24/09

In reply to iSuppli: The iPhone 3GS Costs $178.96 To Build; $4 More Than Previous Model
I guess you leave off the last S for savings?
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iSuppli: The iPhone 3GS Costs $178.96 To Build; $4 More Than Previous Model

iSuppli Official Estimate: The iPhone 3G Build Price is $174.33

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