What iPhones cost to make

[HarryT]

Originally Posted by Kumabjorn

What then would be the operator's margin on selling those phones? £50 for the 16 GB and £75 for the 32 GB?

I suspect that the operator makes most of their margin from the monthly contract tie-in rather than from selling the hardware. The reason that I bought my iPhone SIM-free is that over a 3-year contract term (the time I thought I'd have my iPhone for), buying the phone and then getting a "SIM-only" contract was considerably cheaper than the overall cost of getting an operator-subsidized phone and then paying the monthly contract fees.

[Kumabjorn]

But you are restricted to using that operator, or can you use and switch operators as they offer different plans?

[HarryT]

If you buy a phone from an operator such as Vodafone, it will be "SIM-locked" to Vodafone. If you want a "SIM-free" iPhone, you have to buy it direct from Apple.

[Kumabjorn]

Ok, so that implies that operators make their profits post sale. On data plans, peripherals, streaming services etc?

[David Munch]

Originally Posted by Kumabjorn

Ok, so that implies that operators make their profits post sale. On data plans, peripherals, streaming services etc?

Indeed, which is why you can't buy an iPhone with a small plan.

[Kumabjorn]

What you lose on the carousel you take back on the swings.
Nothing new under the sun I guess.

[kennyc]

Originally Posted by Kumabjorn

... while still going like hotcakes.

Mmmmm.....wireless hotcakes!

[Kumabjorn]

Delivered through your router straight into your open mouth, directly from the grill at iHop.
Jezz, we are getting lazier and lazier.

[teh603]

Originally Posted by HarryT

The "profit" has to pay for the development costs; these devices don't materialise out of thin air.

Originally Posted by xg4bx

Unfortunately the article doesn't spell out how much apple spends on research, which is a fair point, but considering just how much money they make it can't be more than a pittance per unit.

This. It doesn't take very much to buy a bunch of off-the-shelf ICs and mash them together.

[JD Gumby]

Originally Posted by petermillard

Back when Apple was widely being panned by critics for the Foxconn situation, lots of commentators were saying that they'd happily pay extra for a product that was made in the USA. Well, they had their chance with Google's Nexus Q; how did that work out?

Er, no they didn't. It has yet to actually be released (launch postponed indefinitely thanks to word getting out about its general uselessness and excessively high price point for its function).

[5thWiggle]

Originally Posted by teh603

This. It doesn't take very much to buy a bunch of off-the-shelf ICs and mash them together.

Actually, Apple designs its own processors. They are based on ARM chips (a company which started as a joint venture between Acorn Computers, Apple, and VLSI), but Apple does a fair amount of refining. Samsung makes them for Apple.

[HarryT]

Originally Posted by 5thWiggle

Actually, Apple designs its own processors. They are based on ARM chips (a company which started as a joint venture between Acorn Computers, Apple, and VLSI), but Apple does a fair amount of refining. Samsung makes them for Apple.

There's also the software development costs to consider. That doesn't come cheap.

[300com]

exactly... the operating system and all the software on the phone costs more to produce than the manufacture of said parts of the physical handset. Also you need to buy in the billions for said parts front up. What about all the testing and R&D. There is a lot that goes on behind the scenes to get that gadget in your grubby little hands. All they do at the Foxconn is assembly.

[David Munch]

Originally Posted by 5thWiggle

Actually, Apple designs its own processors. They are based on ARM chips (a company which started as a joint venture between Acorn Computers, Apple, and VLSI), but Apple does a fair amount of refining. Samsung makes them for Apple.

...Which they've only in recent years started doing, and *only* for the main CPU in iOS-devices. The avalanche of other chips in their products, are still off the shelf components.

Edit: Apple spend 2.500$ billion in 2011 on R&D, which is considered quite low in the industry, compared to their income.

[petermillard]

Originally Posted by JD Gumby

Er, no they didn't...

Err yes they did! Whilst it was subsequently withdrawn from sale, the Nexus Q was available for pre-order at the same time as the Nexus 7. And apparently the people who pre-ordered (yes, *both* of them) will receive one for free from Google; at that price, you could probably find a use for it.

Or maybe not