iPhone 3G May Cost Apple Only $100

The new iPhone costs Apple considerably less than the original to make, according to an analysis by Portelligent.

David Carey, Portelligent’s president, told EETimes that based on what his firm knows about the components in the 3G iPhone, the bill of materials for the new phone could be as low as $100. The first iPhone, in contrast, came with a BOM of $170.

“Apple’s really taking the gloves off on this one,” Carey told EETimes.


Carey believes the display that Apple paid an estimated $60 for last year may cost half as much this year. He also suggested that the $100 dollar price increase for the 16GB model is only a $20 cost to Apple. The estimates on the 3G iPhone are only best guesses at this time since Portelligent doesn't have an actual 3G iPhone in hand.

To make things even more profitable for Apple, Piper Jaffray’s Gene Munster suggests that carriers could be subsidizing the $199 sale price by $200 which means Apple may be charging its partners as much as $399 per phone.

“If these numbers are true,” writes the Yankee Group’s Carl Howe, “the iPhone 3G could end up being the most profitable product Apple makes.”

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