How much your electronics are really worth

[wooohooo]

http://finance.yahoo.com/family-home...teardowns.html

How much do you think your electronics really cost? I always thought it only cost maybe a hundred bucks to make an iPhone and make gigantic profits. Also another thing about the xbox/ps3 is for a while they sold them at a loss.

Apple iPhone 3GS

Date: June 19, 2009
Retail price: Starting at $199
Cost of components: $179.16

Apple iPod Touch (First Generation)

Date: September, 2007
Retail price: $299 (8GB), $399 (16GB)
Cost of components: $147 (8GB), $179 (16GB)


Microsoft Xbox 360
Date: Nov. 22, 2005
Retail price: $399
Cost of components: $470

[Phanuthier]

Hmm, few comments...

- big reason the cost of portable electronics is cheap: cheap memory. Cost of memory used to be a huge cost in these sort of products, but the crazy demand flooded the market with companies, and now memory companies are dying left, right and center. For instance, Micron has been losing money every quarter for the past 12 quarters, but they're sitting on a ton of cash and trying to buy up all the competition to get rid of the excess supply.

- "cost of components" they talk about the cost of each individual chip and crap in all of these high tech widgets. Assembling all these widgets together isn't exactly the most scientific crux in the world, so that markup basically covers cost of marketing and crap. The components are still the "scientific" cost to these things, still have a huge cost in their R&D, IP, et al.

- cost of production to turn chips into a product is usually done in some 3rd world country fab to keep costs down. For instance, I believe xbox is made in Guadajlajara (or however you spell it). That makes a HUGE difference.

[3 Justin 3]

Consoles always cost more to make then they sell them for. The PS3 when it first came out was outrageously expensive, Sony was losing like $240+ for everyone they sold. It was reported last year that the PS2 JUST started to make profit on the console itself, 8 years after the first one was produced.

The only electronical device of any sort that I know takes a huge profit are cables. They cost $2-3 to make, then Futureshop sells them for $25+.

[TurnedTheCorner]

Nintendo never sells consoles at a loss.

[3 Justin 3]

Originally Posted by TurnedTheCorner

Nintendo never sells consoles at a loss.

Because their consoles are made with components 15 years old.

[TurnedTheCorner]

Pretty much. But they make money using this strategy.

[GGG]

Are these stats based on just the cost of components plus assembly or do they include some R&D and tooling to configure the factory. The big reason is the former are fixed costs rather than the diminishing costs of R&D.